Chapter 15 - Processing health care claims. This chapter also gives you the information you need about patients'' financial responsibilities for services so that you can figure out how much patients should pay and how much will be billed to their health-care plans.
PowerPoint® to accompany Medical Assisting Chapter 15 Second Edition Ramutkowski • Booth • Pugh • Thompson • Whicker Copyright © The McGraw-Hill Companies, Inc Permission required for reproduction or display Processing Health Care Claims Objectives 151 List the basic steps of the health insurance claim process. 152 Describe your role in insurance claims processing 153 Explain how payers set fees 154 Define Medicare and Medicaid 155 Discuss TRICARE and CHAMPVA healthcare benefits programs 156 Distinguish between HMOs and PPOs Processing Healthcare Claims Objectives (cont.) 157 Explain how to manage a workers’ compensation case 158 Apply rules related to coordination of benefits 159 Describe the healthcare claim preparation process. 1510 Complete a Centers for Medicare and Medicaid service (CMS1500) claim form. 1511 Identify three ways to transmit electronic claims. Basic Insurance Terminology Medical insurance (health insurance) is a written contract policy between a policy holder and a health plan. Terms To Know First Party The patient policy holder premium Amount of money paid by the policy holder to the insurance carrier. Second Party The physician who provides medical services benefits Medical services provided Third Party The health plan Basic Insurance Terminology (cont.) Deductible a fixed dollar amount that must be paid or met once a year before thirdparty payers begin to cover expenses Coinsurance a fixed percentage of coverage charges after the deductible is met Copayment a small fee that is collected at the time of the visit Exclusions uncovered expenses Formulary an approved list of drugs Basic Insurance Terminology (cont.) Liability Insurance Covers injuries caused by the insured or on their property Disability Insurance Insurance that is activated when the insured is injured or disabled Types of Health Plans Managed Care Plans • Controls both the financing and delivery of healthcare to policy holders • Both policy holders and physicians (participating physicians) are enrolled by the Managed Care Organizations (MCOs) • In a capitated managed care plan, providers are paid a fixed amount regardless of the number of times the patient is seen by the physician • Oldest and most expensive type of plan • Covers costs of select medical services • Amount services determined by the physician Fee For Service Plans Types of Health Plans (cont.) Preferred Provider Organization (PPO) A network of providers to perform services to plan members Physicians in the plan agree to charge discounted fees Health Maintenance Organization (HMO) Physicians who contract with HMOs are often paid a capitated rate Patients pay premiums and a small copayment, often $10 Types of Health Plans (cont.) Medicare is the largest federal program that provides healthcare to citizens aged 65 and older Managed by the Centers for Medicare and Medicaid Services (CMS) Part A Hospital insurance available to anyone receiving social security benefits Part B Covers physician services, outpatient services, and many other services Available to persons 65 and older that are US citizens A premium must be paid by all unlike Part A Types of Health Plans (cont.) Types of Medicare Plans FeeforService: The Original Medicare Plan Allows the beneficiary to choose any licensed physician certified by Medicare A deductible was charged then Medicare paid 80 percent and the patient paid 20 percent. Medicare + Choice Plans Allows patients to sign up for one of three plans: Medicare Managed Care Plans Medicare Preferred Provider Organization Plans (PPOs) Medicare Private FeeforService Plans 10 Payment and Remittance Advice Information found on the Remittance Advice (RA) Form: Insured name and identification number Name of beneficiary Claim number Date, place, and type of service Amount billed and amount allowed Amount of copayment and payments made Notation of any services not covered 24 Reviewing the Insurer’s Remittance Advice and Payment Verify all information on the remittance advice (RA) line by line If a claim is rejected check the diagnosis codes for accuracy Track all unpaid claims using either a followup log or computer automation 25 Apply Your Knowledge Answer A patient has visited the medical office on two separate occasions within the same week for different ailments. On Monday, the patient complains of back pain and receives a prescription for a muscle relaxant. On Wednesday, the patient complains of hair loss. When the medical assistant files the claims, she accidentally codes the first visit diagnosis (muscle spasm) with the prescribed treatment for the second visit (hair loss) which was an antifungal shampoo. The insurance claim is rejected more than likely for which of the following reasons: Allowable benefits Medical necessity Payments 26 Fee Schedules and Charges Medicare Payment System: RBRVS The payment system used by Medicare is called the resource based relative value scale (RBRVS). The nationally uniform relative value A geographic adjustment factor A nationally uniform conversion factor The current annual Medicare Fee Schedule (MFS) is published by CMS in the Federal Register.27 Fee Schedules and Charges (cont.) Payment Methods Allowed Charges Capitation Contracted Fee Schedule 28 Fee Schedules and Charges (cont.) Allowed Charges This represents the most the payer will pay any provider for that work Other equivalent terms are: Maximum allowable fee Maximum charge Allowable charge Allowed amount Allowed fee Maximum charge Billing the patient for the difference between the higher usual fee and a lower allowed charge is called balance billing 29 Fee Schedules and Charges (cont.) Contracted Fee Schedule Capitation Fixed fee schedules are established particularly with PPOs and participating physicians Participating providers can bill patients for procedures and services not covered by the plan The fixed prepayment for each plan member Calculating Patient Charges All payers require patients to pay for noncovered services. 30 Communication with Patients About Charges Some practices may require that the patient sign an assignment of benefits statement or that they pay in full for services at the time they are rendered The policies should explain what is required of the patient and when payment is due Unassigned Claims Assigned Claims Unless other prior arrangements are made, payment is expected at the time service is delivered The patient is responsible for any amounts not covered by the insurance carrier. Managed Care Members Copayments must be paid before patients leave the office 31 Preparing and Transmitting Healthcare Claims HIPAA Claims Electronic and predominately used Information entered is called data elements X12 837 Health Care Claim is the official name Data must be entered in CAPS in only valid fields No prefixes allowed Paper Claims A CMS1500 paper form is used May be mailed or faxed to the thirdparty payer Not widely used as a result of HIPAA requirements CMS1500 require 33 form indicators 32 Preparing and Transmitting Healthcare Claims (cont.) Transmission of Electronic Claims There are three major methods of transmitting claims electronically: Direct transmission to the payer Using a clearing house Direct data entry 33 Preparing and Transmitting Healthcare Claims (cont.) Generating Clean Claims requires preventing common errors such as: Payer name and/or identifier Or invalid subscriber’s birth date Part of the name or identifier of the referring provider Service facility name, address information Information about secondary insurance plans Medicare or benefits assignment indicator34 Preparing and Transmitting Healthcare Claims (cont.) Claims Security The HIPAA rules set standards for protecting individually identifiable health information when maintained or transmitted electronically Common security measures used consists of: Access control, passwords, and log files to keep intruders out Backups (saved copies of files) Security policies to handle violations that do occur 35 Tips for the Office/Data Elements for HIPAA Electronic Claims Reporting ProviderInformation The billing provider is the entity that Payto provider (the office) transmits the claim to the payer Rendering provider (the physician) Taxonomy Information A taxonomy code is a 10digit number representing the physician specialty HIPAA National Identifiers Identifiers are numbers of predetermined length and structure like social security numbers. This code matches the physician’s license certification education National identifiers must be established for: Employers Health plans Healthcare providers 36 Patients Apply Your Knowledge Answer A medical assistant has two parttime positions. One for a pediatrician and the other position is for a surgeon. When completing the X12 837, which of the following would be a major difference: a Taxonomy information b HIPAA identifiers The taxonomy information would be very different since the physician preparations and licensing is very different 37 END OF CHAPTER 38 ... Objectives 15 1 List the basic steps of the health insurance claim process. 15 2 Describe your role in insurance claims processing 15 3 Explain how payers set fees 15 4 Define Medicare and Medicaid 15 5 Discuss TRICARE and CHAMPVA healthcare ... 15 5 Discuss TRICARE and CHAMPVA healthcare benefits programs 15 6 Distinguish between HMOs and PPOs Processing Healthcare Claims Objectives (cont.) 15 7 Explain how to manage a workers’ compensation case 15 8 ... Apply rules related to coordination of benefits 15 9 Describe the healthcare claim preparation process. 15 10 Complete a Centers for Medicare and Medicaid service (CMS 150 0) claim form. 15 11 Identify three ways to transmit electronic