You know that really tough teacher you had growing up? The one who, no matter how hard you tried, refused to give you the A+ you so desperately wanted? It seemed like they weren’t clear about what they were looking for, like the goalposts were always moving.
That’s what compliance risk feels like for many healthcare organizations.
The requirements are complex. The rules and regulations are always changing. Denials come back with little explanation or guidance.
Keeping up with it all is downright exhausting—not to mention, expensive.
And many organizations are still relying on reactive, manual compliance processes. Quality teams are spot-checking a small fraction of notes, discovering and addressing issues after denials or audits happen. But it doesn’t have to be that way.
AI is changing how healthcare organizations manage compliance. By automating manual tasks and freeing up time for teams to be more proactive, AI helps ensure clinicians are better supported, risks are uncovered sooner, and revenue is better protected.
Where Risks Quietly Accumulate
The behavioral health, substance use disorder (SUD), and care at home markets face some of the most complex documentation requirements in health care. From hour-long sessions and group therapy documentation to OASIS-E and HOPE forms that can take hours to complete, there’s no shortage of tricky paperwork.
And demand for mental health, care at home, and SUD services doesn’t seem to be slowing down anytime soon. Instead, clinicians are overworked, documentation backlogs are massive, and notes are often submitted late.
It’s the perfect recipe for provider burnout and note quality issues like:
- Copying and pasting,
- Empty or missing fields, and
- Missed or inaccurate clinical details.
As Laura Siclari, Esq., Managing Partner at Siclari Law Group, explains:
“The reason clinicians sometimes cut corners in their notes is not from any kind of nefarious reasons. They are just really overbooked during the day with back-to-back clinical appointments…and they’re up late at night sometimes trying to catch up from the day and to get clinical notes in.”
It just goes to show that compliance risk isn’t always a back-office issue. The pressure really shows up first on the front lines. Pair that with QA/QAPI teams who can only review a small portion of notes, and it’s easy to see why mistakes slip through unnoticed—only to show up later as penalties or denials.
And the financial consequences are only the beginning. When compliance issues spin out of control, it also threatens operations, care quality, and overall organizational reputation and culture.
What Compliance Gaps Actually Cost Your Organization
Documentation may seem like “just the administrative side of the job”—the paperwork that every clinician dreads. But for healthcare organizations, it’s a lot bigger than that.
The effects of non-compliant documentation go beyond rework and audits:
- Clinicians burn out, and turnover rises—putting a strain on staff and their caseloads;
- Care quality suffers when clinicians are stretched thin and critical clinical information isn’t captured;
- Revenue is exposed to risk through denials and clawbacks; and
- Funding and contracts are jeopardized when documentation fails to substantiate services or outcomes.
In fact, according to Becker’s Healthcare, claim denial rates increased 23% between 2016 and 2022—and that trend has only intensified in recent years. In 2025, the average denied amount increased by 14% in hospital outpatient settings and 12% in inpatient settings, with Medicare and Medicaid accounting for some of the largest increases.
Over time, compliance gaps put a drain on financial health—eroding margins, slowing growth, and forcing teams into reactive, high-stress workflows.
And the risk doesn’t stop with a single claim. As Siclari notes in the clip below, once auditors identify a problem, they often expand their review—turning isolated documentation issues into organization-wide exposure.
Why Manual Monitoring No Longer Works
This is where many organizations get stuck. Faced with rising denials and audit pressure, the instinct is often to double down on the same old approach. More spot checks, more policies, more after-the-fact reviews.
But reactive workflows simply can’t keep up with potential threats.
Even the strongest quality teams are limited by a manual review process. It’s physically impossible for them to comb through every single note in detail. Most can only audit 5-10% of all documentation—meaning risky notes are inevitably hiding in the other 90-95%.
And by the time an issue is flagged, the claim has already gone out the door, the revenue is already at risk, and the opportunity to fix the root cause has passed.
How AI is Coming to the Rescue
AI is rapidly moving from being a work acceleration tool to a frontline prevention tool—one that helps organizations protect revenue before it’s ever exposed to risk.
Instead of catching errors after a claim is denied or an audit begins, AI enables clinicians and QA/QAPI teams to identify and correct issues earlier in the process.
Here’s how.
1. Preventing Errors at the Source
When it comes to compliance, the old “act now, fix later” approach doesn’t really work. Once documentation issues slip through, the fallout escalates quickly—by way of clawbacks, audit penalties, corrective action plans, and even lost funding.
As Rony Gadiwalla, CIO of GRAND Mental Health, says, “The further downstream you catch a problem, the harder and more expensive it is to correct it.”
That’s exactly why prevention is the most effective compliance strategy.
AI-supported documentation tools help clinicians capture complete, accurate notes at the point of care, when details are still fresh. With Eleos, for example, AI analyzes each unique session and drafts up to 80% of the progress note content in minutes. Providers simply review, adjust, and submit—an especially meaningful win for SUD providers delivering group care, where the documentation burden is even heavier.
With that kind of AI support, providers submit notes that are more individualized, less reliant on copied-and-pasted language, and more clearly connected to the treatment plan and interventions delivered.
Plus, with ambient listening, providers can more easily avoid the natural human bias that creeps into notes. It’s like an objective third party that doesn’t miss or skew things based on their own experience.
Ultimately, if your documentation isn’t defensible, then neither is your revenue. So, the more accurate your notes, the more financially stable your organization.
2. Making Notes More Timely
With full caseloads, back-to-back sessions, and at-home visits (especially in the care at home space), many clinicians simply can’t document at the point of care. Notes get pushed to nights and weekends—becoming largely dependent on the clinician’s memory or the chicken scratch they quickly jotted down after the session.
Accuracy declines, and late notes become the norm.
But with AI helping clinicians complete their notes 70% faster, documentation is done minutes—rather than days—after the session. That speed eases administrative burden, improves note quality, protects revenue, and may even prevent audits.
That’s because when documentation is delayed more than 48-72 hours, insurers (including Medicare and Medicaid) are more likely to flag or deny claims.
Find out how Eleos helped Bert Nash complete 90% of notes within 24 hours.
3. Monitoring Risks Continuously
Even with stronger documentation at the point of care, compliance risk doesn’t completely disappear. AI isn’t perfect, and neither are the humans using the technology. So, making sure you still continue to monitor notes for compliance risk is critical.
But again, quality teams can only review a small, random sampling of notes across the org. An AI solution can make a huge difference here. By automatically scanning 100% of notes, tools like Eleos give compliance teams the visibility they need to focus their expertise where it matters most.
Instead of spinning their wheels on random notes, teams can prioritize those at the highest risk, target staff training more effectively, and intervene before issues escalate into denials or audits.
In fact, organizations using Eleos Compliance can:
- Review 10–20x more notes automatically;
- Redirect 80%+ of review time toward high-risk areas; and
- Reduce their average feedback cycle time from 6+ months to 1 day.
The 6-Point Check
When auditors “peek under the hood,” they look for specific signals to determine whether to keep digging.
Eleos Compliance continuously checks for these most common—and costly—documentation risks:
- Note cloning: Duplicate or copy-paste content across notes.
- Empty or insufficient notes: Content that is too brief to meet payer or regulatory requirements.
- Missing interventions: Inadequate documentation of what was actually done.
- Missing progress mentions: Lack of clarity around client progress in care.
- Missing action plans: No documented next steps for treatment.
- Broken golden thread: Services not clearly connected to the care plan.
By catching these issues early, organizations can address risk before claims are submitted—or before auditors come knocking.
“The visibility we suddenly got from turning this on—we were starting to see data we had never seen before,” Gadiwalla says. “The idea that we are going to audit 100% of our notes without increasing staff is a game-changer. No one even thought this was possible.”
And if an audit does occur, AI-driven visibility becomes a powerful advantage. Leaders can see trends across programs, supervisors can coach proactively, and teams can walk into audits with confidence.
Download our Compliant Progress Note Examples to see a color-coded breakdown of what makes a note compliant and what puts it at risk—and how Eleos supports note quality.
4. Alleviating Administrative Burdens
When it comes to keeping up with complex documentation, the strain doesn’t just hit your finances. It also affects your people—deeply.
Across behavioral health, substance use disorder, and care-at-home settings, teams are facing growing caseloads, staffing shortages, and expanding compliance expectations—often without additional support.
For clinicians, that pressure frequently spills into nights and weekends, contributing to the “pajama time” problem that now affects nearly half of U.S. physicians.
AI can help lift some of that burden by automating repetitive tasks, enabling clinicians to spend less time charting and more time with clients or patients.
The ROI of Getting Compliance Right
By now, hopefully, it’s clear that accurate, timely, and defensible documentation is the key to minimizing denials and rework. And when you layer in proactive compliance support for quality teams, the result is more than efficiency—it’s measurable return on investment.
As Tom Morgan, CIO of Merakey, shares, “The immediate ROI is just our ability to audit every note, and that’s protecting us from paybacks. Eleos Compliance allows us to get out in front of that, and that alone saves us a lot of dollars.”
Incredibly, Gulf Coast Center added $1.1 million in audit capacity at a fraction of the cost of hiring additional staff. Instead of manually reviewing just 15% of notes over the course of a year, their quality team uses AI to review every eligible note.
As Gulf Coast CEO Felicia Jeffery explains, “Now we can audit 100% of notes and only spend time reviewing the ones that need attention. We didn’t cut any positions—we’re just doing more with less. And I’m taking the savings and putting it toward increasing salaries.”
Organizations using AI-supported documentation and compliance workflows also report:
- 70% less administrative time,
- 2x higher client engagement,
- 3-4x better symptom reduction, and
- 20% lower staff turnover.
All of which can create significant financial returns.
Read how Gulf Coast Center achieved 8x ROI with Eleos Documentation and Compliance.
From Guesswork to Confidence
For years, compliance has felt like trying to pass a class without knowing what’s on the test. Teams do their best, only to find out after the fact where they missed the mark.
AI is changing that—shifting compliance from a reactive, back-office function to a proactive, preventive system from top to bottom.
The result isn’t just fewer denials or smoother audits. It’s confidence that your documentation reflects the care you deliver, your teams can focus on what matters most, and your organization is prepared for whatever comes next.
Explore a more sustainable approach to compliance in your organization. Request a demo today to chat with our team.
