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Bill audit rule execution

clsBillAuditor.AuditBill runs thirteen rule handlers, in registration order, over the bill's auditable services. Together they validate bill-level codes (DRG, diagnosis/procedure, admit type), compute each service's basic allowance (fee schedule, pharmacy, mileage, cost-charge), apply provider contract pricing, check cross-service rules (global surgery periods, the three-point rule, procedure bundling), and run final checks (denied claim, ineligible providers/services, duplicates, late filing, non-MCO providers, MCO withhold, voided claim) before totaling the bill.

Field Value
Operation ID OP-AA-05
Trigger BillAuditEngine.AuditBill calls clsBillAuditor.AuditBill(Bill) once bill edits, service edits, and (for non-Worker-Reimbursement bills) MCO determination have completed
Inputs clsBillAudit with edited, MCO-resolved auditable services (ReauditCode = "R"); resolved Claim, BillingProvider, and service history
Outputs Computed AllowedAmount/TotalAdjustmentAmount/adjustment codes per service; recomputed bill audit totals (TotalChargedAmount, TotalAllowedAmount, TotalMcoAdminFeeAmount); Bill.BillTotalAmount; audit messages; boolean pass/fail
Primary components clsBillAuditor.AuditBill and its thirteen registered rule handlers
Entry point Business\SAIF.Business.Claim.Bill.AutomatedAudit\AuditUtilities\clsBillAuditor.vb

Steps

AuditBill starts the "Audit Bill" trail group, clears broken rules, and runs the following rule handlers in order, then returns ErrorCount = 0:

  1. UpdateMergeClaimID. If Bill.ClaimID <> Bill.Claim.ClaimID (the claim was merged), update the bill's claim ID/number/check digit to the merged claim's values and record informational message "Claim has been merged".
  2. ValidateDRGCode. IsDRGCodeRequired requires a DRG code only for InpatientHospital bills with a UB bill type code of 0111–0118, no billed service code starting with "002", and a billing provider that is not a critical-access hospital. When required, IsDRGCodeValid checks the code with an inline query (SQL-001, CBP_DRG_CODE). If missing/invalid: message "Invalid or missing DRG Code", disallow all services with adjustment code GS (DisallowAllServices), and return False for this rule (BR-005).
  3. ValidateDiagnosisandProcedureCode. If the billing provider type requires a diagnosis and none exists: disallow all services with GW and stop. Otherwise, validate each diagnosis (must resolve and be effective on the statement-thru date; outpatient hospital bills additionally need at least one diagnosis of type R) and each procedure (must resolve and be effective on the statement-thru date). Any invalid diagnosis produces warning "One or more diagnosis code is not valid."; any invalid procedure produces warning "One or more procedure code is not valid." Either failure disallows all services with GW (BR-006).
  4. ComputeBasicAllowance. For each auditable service (with a compound-drug dispensing-fee override applied on/after 4/1/2016), dispatch by service type:
  5. Revenue → no basic allowance is computed here.
  6. Equipment → ComputeFeeScheduleAllowance (pre-/post-1/1/2012 logic, see step 5).
  7. Pharmacy (not Worker Reimbursement) → ComputeServiceLinePharmacyAllowance, which resolves the effective pharmacy allowance record and NDC price and computes the fee schedule via clsAuditCalculator.CalcPharmacyAllowance; if the charge exceeds the computed fee schedule, a full-charge FT adjustment is created.
  8. Worker Reimbursement WMILE/FMILE → ComputeMileageAllowance (fee-maximum-times-quantity; overwrites billed/audited amounts to the regulated amount if the charge is not larger, else creates FT).
  9. All other types → ComputeFeeScheduleAllowance.

  10. For inpatient/outpatient bills where the fee schedule amount remains 0, additionally compute a cost-charge allowance (ComputeCostChargeAllowance) using the effective clsDCBSCostCharge factor on the billing provider (default factor 1 if none is found).

    Origin: The DCBS cost/charge factor is implemented by Retrieve DCBS cost charges in SAIF.BOF.Business.View.Provider. - ComputeFeeScheduleAllowance itself applies percent-off eligibility (80%, or 90% for dental on/after 4/1/2012), max-amount eligibility, facility/non-facility quantity rules, post-2012 equipment-modifier formulas (UE 75%, RR 10%, else full), and the DCBS conversion factor (defaulting to 1 if missing); it forces adjustment code FT for SG/WMEAL/WDINR/WLODG services and for R0001 (which also adds a 9.5 base rate); if the charge exceeds the fee schedule, it creates the adjustment and marks FeeScheduleCode = "F"; for non-physician-assistant (NP/PA) CPT services it applies a further percentage reduction (FC, 80% before 4/1/2005 else 85%); and for modifiers 80/81/82/50/51 it calls AlterFeeSchedule to compute surgical-assistant (FP/FQ/FO/SI), multiple-surgery (FL, 50%), or bilateral-surgery (SF, 50%) adjustments. 5. MultipleRadiography. For each auditable service with a positive allowed amount whose CPT record (resolved via cached service reference data) flags multiple-radiography disallow codes (MULCT/MULMR pre-7/1/2007; MULCT/MULCA/MULMA/MULMR post-6/30/2007 without modifier 26), find matching historical (via SQL-002 history data, CBP_BILL) and current same-provider, same-day services and apply a percentage-based FH adjustment (AllowedAmount - FeeScheduleAmount * percent, using the era-specific percentage table).

Origin: CPT/fee-schedule reference data and bundling flags used throughout this rule set (steps 4, 5, and 8) are resolved by Service reference lookups in SAIF.Business.Claim.Bill. 6. ProviderContracts. If the billing provider has service contracts, first checks outpatient-hospital package pricing (CheckForProviderContractPackagePrice — a single-procedure MCO bill matched against package-priced contracts for the claim's MCO plan; spreads a computed MA adjustment across services when the package price is below the eligible amount), then for each auditable service finds a matching contract (FindProviderServiceContract/ContractQualifies, checked by service type/CBP code, purchase-vs-rental modifiers, ASC status, and MCO-plan match) and applies a discount-rate, additional-fee-discount-rate, or max-charge adjustment coded MC (MCO-plan contract) or NA (non-plan contract).

Origin: Provider service contracts are implemented by Retrieve provider service contracts in SAIF.BOF.Business.View.Provider. 7. EquipmentAllowance. For DME equipment services before 1/1/2012 that are auditable, not rentals (RR), and have no provider contract already applied: if the charge is under 50, no action; otherwise dispatch by MsrpInvoiceCode — "M" → FG at 85%, "I" → SB at 125% before 4/1/2006 else FG at 140%, anything else → error "<ServiceCode> Invalid MSRP/Invoice Flag". If no MSRP/invoice amount exists, compute the standard fee schedule and disallow with FZ if still unreduced. 8. CrossServiceAudit2. For each auditable service with a positive allowed amount and a resolved CPT record: CheckGlobal (global-surgery-period checks against history and same-bill services, applying CD/CC/CA adjustments, unless modifiers 80/82 are present) and CheckThreePTRule (for CPT disallow code 3PT, allows the first three already-paid-or-highest-amount services and fully disallows the rest with FJ). For Standard/OutpatientHospital bills, CheckBundling additionally runs on remaining positive-allowed services (excluding physical-medicine codes 97001–97799 and ASC SG services), applying CB bundling adjustments unless override modifiers 59/XE/XP/XS/XU are present (which instead generate a bundle-override warning). 9. FinalAuditChecks. Runs, in order: - CheckDeniedClaim — for a denied claim (excluding R0001/N0001/N0002 and IME services), disallows remaining auditable services fully with DF, or DB if there are no medical conditions or any decision is missing a final denial reason. - CheckForInelligbleProviders — for each positive-allowed auditable service, checks servicing-provider ineligibility periods covering the service date; disallows fully with TD by default, TY for reason NPN, or TS (also forcing ReauditCode = "X") for reason COL. - CheckForInelligbleServices — looks up a disallow code from the national drug record (pharmacy) or the resolved service (non-pharmacy); if present, creates a full adjustment and sets ReauditCode = "X". - CheckForDuplicates — compares each service against historical (SQL-002) and current bill services using type-specific matching rules (inpatient exact/partial match on provider+admission date+service+charge; non-hospital exact/provider/date/service/charge, a WMILE-specific audited-charge comparison, pharmacy same-date-NDC match, and same-date service/NDC+charge matches), sets OriginalBillCode to "D" (definite) or "U" (possible) and links OriginalBillID/OriginalServiceID, and reduces payment by the prior-paid amount using adjustment code PA (fully paid previously), PB (no prior allowed amount found), or PC (prior payment exists but original incomplete) (BR-021). - CheckForLateFiling — for original (non-rebill), non-Worker-Reimbursement, positive-allowed services of eligible types (Ambulance/Dental/Equipment/Medical/Pharmacy/Revenue/VocRehab), applies era-based reductions or disallowance using the later of service date/service end date: before 4/1/2006 (or any Vocational Rehabilitation date), 10% reduction per month after 60 days (FD), with Vocational Rehabilitation fully disallowed (SO) after 180 days; 4/1/2006–6/30/2007, a compounding 10% monthly reduction after 90 days (FD); after 6/30/2007, full disallowance (FD) after 365 days (BR-020). - CheckForNonMCOProvider — for a claim with mandatory-MCO status "Y", a positive-allowed, mandatory-MCO service with no active withhold, a service date more than 14 days after the MCO effective date, and a non-anesthesiology (AN) servicing provider: full-charge MG adjustment (BR-019). 10. MCOWithhold. For services flagged IsMCOWithhold by MCO determination: if the provider-admin-fee flag applies and the service is not NDC-only, checks service-level MCO fee exemptions for the plan/date and clears the withhold flag if exempt. If still eligible, determines the withhold rate (service-specific admin-fee rate when under 1, else the default clsMCOProviderTypeAdminFee for the plan/provider-type/date) and sets McoAdminFeeAmount = Rate * AllowedAmount and McoAdminFeeRate = Rate. 11. CheckVoidedClaim. If Bill.Claim.ClaimStatus.IsVoid: disallow all services fully with WG, warn "Bill belongs to voided claim", and return False for this rule (BR-018). 12. CompleteAudit. For each service, verify AllowedAmount = ChargeAmount + TotalAdjustmentAmount; on mismatch, log detail and error "<serviceCodeOrNDC> Error Computing Allowance - call Help Desk". Reset any remaining non-blank ReauditCode to a single blank, default null MCO admin-fee amounts to 0, default blank service type codes to "U", and default null fee schedule amounts to 0. Recompute the bill's audit totals (charged, allowed, MCO admin fee) and set Bill.BillTotalAmount to the total charged amount. Return False if any mismatch error was generated. 13. ValidateAdmitTypeCode. For InpatientHospital bills, requires AdmitTypeCode in 1,2,3,4,5,9; if invalid, message "Invalid Admit Type Code({0})." and disallow all services with GY (BR-007).

AuditBill stops the "Audit Bill" trail group and returns ErrorCount = 0 — a False return from any handler above (steps 2, 3, 11, 12, 13) contributes to that error count and is surfaced to BillAuditEngine as FailAuditCheck.

Process flow

flowchart TD
    Start([clsBillAuditor.AuditBill invoked]) --> Merge[UpdateMergeClaimID]
    Merge --> DRG{DRG required<br>and valid?}
    DRG -->|No| DisallowGS([Disallow all: GS]) --> Diag
    DRG -->|Yes| Diag[ValidateDiagnosisandProcedureCode]
    Diag -->|Invalid| DisallowGW([Disallow all: GW]) --> Admit
    Diag -->|Valid| Basic[ComputeBasicAllowance per service]
    Basic --> Radio[MultipleRadiography]
    Radio --> Contracts[ProviderContracts]
    Contracts --> Equip[EquipmentAllowance]
    Equip --> Cross[CrossServiceAudit2:<br>global, 3PT, bundling]
    Cross --> Final[FinalAuditChecks:<br>denied claim, ineligible provider/service,<br>duplicates, late filing, non-MCO provider]
    Final --> Withhold[MCOWithhold]
    Withhold --> Void{Claim voided?}
    Void -->|Yes| DisallowWG([Disallow all: WG]) --> Complete
    Void -->|No| Complete[CompleteAudit:<br>verify totals, recompute bill totals]
    Complete --> Admit[ValidateAdmitTypeCode]
    Admit -->|Invalid| DisallowGY([Disallow all: GY])
    Admit -->|Valid| Done([Return ErrorCount = 0])
    DisallowGY --> Done

Failure and edge-case behavior

  • DisallowAllServices removes prior adjustments and applies a full-charge disallowance to every service, so an early bill-level failure (DRG, diagnosis/procedure, voided claim, admit type) overwrites any per-service work already done by ComputeBasicAllowance, ProviderContracts, and later steps for that run.
  • ComputeFeeScheduleAllowance/AlterFeeSchedule layer many date-conditional percentages (NP/PA reduction era, surgical-assistant modifier era, package-price ratio); a service can match more than one adjustment path in sequence, and only the last-applied non-zero adjustment is persisted, since each helper checks for a positive computed amount before generating its own adjustment.*
  • CheckForProviderContractPackagePrice only applies to outpatient-hospital bills with exactly one procedure and an MCO-enrolled billing provider; all other bill shapes skip package pricing even if the billing provider has service contracts.
  • The three-point rule (CheckThreePTRule) and bundling (CheckBundling) both depend on accurate historical data from SQL-002; missing or stale historical bill data silently allows services that should have been reduced.*
  • CheckForLateFiling explicitly exempts Worker Reimbursement bills and rebills (non-"O" OriginalBillCode), so late-filed rebills are never reduced by this rule.
  • A AllowedAmount <> ChargeAmount + TotalAdjustmentAmount mismatch in CompleteAudit is treated as a hard environment-level data error ("...call Help Desk"), not a business-rule warning, and fails the entire rule execution.

Note: Statements marked with * were inferred from code structure, naming conventions, or contextual evidence where direct confirmation was not available in source artifacts.

Sources

  • Business\SAIF.Business.Claim.Bill.AutomatedAudit\AuditUtilities\clsBillAuditor.vb
  • Business\SAIF.Business.Claim.Bill.AutomatedAudit\AuditUtilities\clsAuditCalculator.vb
  • Business\SAIF.Business.Claim.Bill.AutomatedAudit\AuditUtilities\clsClaimBillHistory.vb
  • Business\SAIF.Business.Claim.Bill.AutomatedAudit\AuditUtilities\clsBillAuditUtility.vb