CMS Audit Activity Is Increasing – Here’s How HTS Is Protecting Our Shared Success
CMS-approved Recovery Audit Contractor (RAC) activity continues to expand, with recent focus areas now including therapy claims billed with the KX modifier. These complex reviews apply to outpatient therapy and professional therapy services, including physical therapy, occupational therapy, and speech-language pathology claims.
At HTS, we closely monitor regulatory and audit trends because we understand that compliance, reimbursement integrity, and documentation quality directly impact both our organization and the facilities we serve. In today’s environment, providers are facing increasing scrutiny related to medical necessity, coding accuracy, and documentation support for skilled therapy services.
The KX modifier specifically indicates that therapy services exceeding the Medicare therapy threshold remain reasonable, medically necessary, and appropriately supported within the medical record. RAC auditors are reviewing documentation to ensure claims meet Medicare coverage criteria, coding requirements, and clinical support expectations.
These reviews go far beyond confirming that therapy was provided. Auditors are evaluating whether the medical record clearly demonstrates:
- Skilled need for therapy services
- Continued medical necessity
- Functional relevance of interventions
- Objective progress toward goals
- Alignment between the plan of care, daily documentation, progress reports, and billed services
- Appropriate coding and billing practices
As audit activity continues to evolve, HTS remains committed to maintaining strong compliance oversight and proactive risk mitigation strategies across our therapy operations. Our approach is designed not only to support documentation quality but also to help protect our facility partners from avoidable compliance exposure.
To support this effort, HTS utilizes multiple layers of oversight and compliance support, including:
- Ongoing education and training for therapy teams
- Internal documentation review processes
- Monitoring of coding and billing trends
- Clinical oversight related to medical necessity and skilled documentation
- EMR workflows designed to support compliant billing practices
- Proactive identification of documentation risk areas
In addition, HTS has continued our two-decade-long partnership with Proactive LTC Consulting to complete therapy chart audits focused on identifying potential gaps, compliance concerns, and audit vulnerabilities before they become larger issues.
These audits provide valuable insight into documentation trends and opportunities for improvement across facilities. Once audits are completed, HTS works collaboratively with therapy teams to review recommendations, implement corrective actions when needed, and strengthen ongoing compliance practices.
At HTS, we recognize that the risks and the rewards are shared. Strong clinical documentation and compliant billing practices protect reimbursement, support quality outcomes, and reinforce the integrity of the services provided to residents. By staying ahead of audit trends and investing in proactive compliance strategies, we aim to be a trusted partner that facilities can rely on in an increasingly complex regulatory environment.
Written by:
Sheena Mattingly, M.S. CCC-SLP, RAC-CT
EVP of Quality & Compliance
