Medicare MAC Audit Defense & TPE Compliance Playbook
Defend Your Practice Against Targeted Probe and Educate (TPE) Reviews, Recovery Audit Contractors (RAC), and Extrapolated UPIC Clawbacks.
Medicare Administrative Contractors (MACs such as Novitas Solutions, Noridian Healthcare Solutions, Palmetto GBA, and First Coast) utilize sophisticated data mining algorithms to identify physician outliers. Practices flagged for aberrant billing patterns face Targeted Probe and Educate (TPE) reviews (a 20-to-40 chart audit). If error rates exceed 15%, providers face Round 2, Round 3, and potential referral to Unified Program Integrity Contractors (UPIC) for statistically extrapolated overpayment demands that can exceed millions of dollars. Our audit team conducts pre-audit defensibility scrubs and manages all 5 levels of Medicare appeals.
Audit red flags
- Receiving a formal TPE notification letter from Novitas, Noridian, Palmetto, or NGS requesting 20-40 patient charts.
- Physician signature missing or not electronically authenticated with date/time stamps on progress notes.
- Cloned medical documentation (identical copy-pasted physical exams across multiple dates of service).
- Medicare issuing an Overpayment Demand Notice stating you have 30 days to pay before recoupment begins.
Audit action plan
- 1. Emergency 20-Chart Pre-Audit Scrub — Conduct an immediate independent audit on the exact 20 to 40 charts requested before submitting to the MAC to identify vulnerabilities.
- 2. TPE Post-Probe Educational Defense — Participate in the mandatory MAC one-on-one educational session with our coding directors to dispute improper auditor deductions.
- 3. 5-Level Medicare Appeal Escalation — Execute structured Redetermination (Level 1), Reconsideration by QIC (Level 2), and ALJ Administrative Law Judge hearings (Level 3) with clinical expert witnesses.
Codes reviewed
- 99215 / 99205 — Highest-Level Outpatient E/M Codes
- Critical Care (99291 / 99292) — Evaluation and Management of Critically Ill Patients
- G0438 / G0439 — Annual Wellness Visits
- CPT 20610 / 20611 — Major Joint Injections
Frequently asked questions
What happens if we fail Round 1 of a Medicare TPE audit?
Failing Round 1 (error rate above 15%) means the MAC will provide an educational session followed by a 45-day improvement window, after which Round 2 of 20-40 charts will be initiated. Failing all three rounds triggers referral to CMS for 100% prepayment review or UPIC referral.
Can we stop Medicare from taking money back while we appeal?
Yes. If you file a timely Level 1 Redetermination within 30 days of the demand notice, Medicare is legally barred from recouping funds from your ongoing remittance payments until Level 2 Reconsideration is completed.