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CONTENTS

S.NO. TOPIC PAGE NO.

1 Medical Billing – Outsourcing 3

2 Medical Billing – WHAT IS IT? 3

3 Medical Billing – WHY IS IT DONE? 5

4 Medical Billing – FOR WHO IS IT DONE? 6

5 Medical Billing – WHO DOES IT? 7

6 Medical Billing – WHO IS BILLED? 8

7 Medical Billing – HOW IS IT DONE? 9

8 Medical Billing Workflow 9

9 Insurance 10

10 Health Insurance 18

11 Health Insurance Processes 34

12 Federal Forms 40

13 1.HCFA 1500 41

14 2.UB 92 FORMS or HCFA 1450 49

15 HCFA 1500 Form Filing Instructions 43

16 UB92 Form Filing Instructions 49

17 Medical Terms, Procedures & Documentation Overview 50

18 Medical Coding 61

19 The Billing Process 70

20 AR – Account Receivable Issues 78

21 Identifying & Solving AR Issues: 80

22 HIPAA 115

23 Billing Terminologies 116

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 Medical Billing – OUTSOURCING

Insurance Patient Doctor

USA Billing Offices

India

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 Medical Billing – WHAT IS IT?

In a NUTSHELL - Medical billing (United States):

Definition:

Medical Billing is the practice of submitting claims to Insurance companies

(Carrier) either Private or Federal (United States Government), specifically

Medicare, in order to receive payment for services provided to a patient by the

Doctor (Physician / Provider).

This process is typically performed in a series of steps

The Doctor examines a patient who is Sick, Injured or requires Health

Management.

Depending on the examination & service provided, the doctor creates or

updates the patient's medical record.

This record will contain information given by the patient to the Doctor /

Doctor‘s office regarding illnesses, injuries or lifestyle prior to the

treatment. This forms the basis for the diagnosis and the corresponding

treatment derived from it.

The treatment, along with the diagnosis, and even the time spent with a

patient are combined to determine the level of service or procedure

provided to the patient.

This information is then sent by the Doctor‘s Office to the Medical

Transcriptionist in the form of voice files.

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The next step is to transcribe these files into data files. This is done by

a Medical Transcriptionist, and this process is termed as Medical

Transcription

These data files are then coded by a Medical Coder (A certified

professional coder is known as a CPC). Medical Coding is the process of

converting the diagnostic and procedural discriptions (data files) into a

set of standard Alpha / Numeric codes, which are determined &

periodically updated by the American Medical Association. The diagnostic

records are converted to ICD codes – International Classification of

diseases & the treatment or procedure records are coverted to CPT codes

– Current Procedural Terminology. Medical coding ensures accurate billing

and reimbursement

Once the medical records are coded they are sent to the Billing Office.

The billing office is the place where charges are created for the doctor‘s

services & sent to respective insurance companies for payment. The billing

office works on behalf of the doctor

Next in the Medical Billing Office, in the Charge Entry Department a

billing record, either paper (usually a standardized form called an HCFA /

UB92) or electronic, is generated based on the information provided by

the coder. This billing record or claim is then submitted either to a

clearinghouse that acts as an intermediary for the information (this is

typical for electronic records) or directly to the insurance company for

payment. This process is termed as Claims Transmission

The claim is processed by the respective insurance company. It is then

either payed or denied. This explanation is sent in the form of an EOB

(Explanation of Benefits) to the billing office

In the billing office, Cash Application / Posting is done to those accounts

for which payment is received

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Claims denied for payment, are sent to the AR (Accounts Receivable)

department. Here the reasons for denial are analyzed by analysts & calls

to the insurance are made by callers, to sort issues & receive payment

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 Medical Billing – WHY IS IT DONE?

Concept

In the present day physicians are not paid immediately by the patient for the

services rendered. Instead in most cases, the Insurance Company makes the

payment to the physician on behalf of that patient, if he/she has health insurance

coverage with them.

In the United States majority of the patients have insurance coverage and details

of such coverage are provided to the physician before treatment. It is the

responsibility of the physician to submit claims to the insurance company and get

paid for his services.

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Submitting Claims and getting paid is a lengthy process and involves a lot of rules

and regulations and is very complicated. The physician needs to adhere to all these

rules before submitting claims. This process is very diverse from the physician‘s

core activity & calls for a particular set of skills. It is usually outsourced to a set

of professionals called Medical Billers. This activity paves the way for the concept

of Medical Billing.

Healthcare has become one of the fastest growing industries in the United

States. This growth can be attributed to the recent legislation and changes in

medical insurance. Hospitals, private practices and clinics could not survive

without someone to efficiently handle their day-to-day medical billing

procedures.

Medical Billing – FOR WHO IS IT DONE?

Doctor drowning

Medical Billing is done for the Doctor. The process of creating a charge for the

services the doctor renders and claiming the same from the insurance is outsourced

to a Billing office. This helps save time & energy for the doctor & allows him/her to

concentrate more on his/her core area of business - Health Care Management.

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 Medical Billing – WHO DOES IT?

There are three parties involved in the process of Medical Billing.

The PHYSICIAN,

The 3rd PARTY INSURANCE COMPANY

The PATIENT.

The billing office on behalf of the Provider does the actual process of Billing or

Insurance Claiming. Physicians appoint Medical Billing Companies to take care of

their billing. The Service Level Agreement between the Billing Company & the

Physician clearly determines the duties, responsibilities & the process to be

adopted by the Billing Office in carrying out the objectives of the Physician. The

main objective of the Billing Company is to maximize collections for the Physician.

Medical Billing – WHO IS BILLED?

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Patients take policies with a health insurance company, to cover their health care

costs or liabilities. The insurance company takes responsibility of all the financial

risks (within the scope of the policy) undergone by the patient, in relation to

medical treatment for himself or his dependents during the tenure of the policy.

Therefore usually the charges are paid by the Insurance Company & very rarely

are borne by the Patients.

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 Medical Billing – HOW IS IT DONE?

For many decades, Medical Billing was done almost entirely on paper. However,

with the advent of computers it became possible to manage more claims at a

time. This eventually brought about the business of medical billing.

Responsibilities involve accurately completing claim forms, promptly billing

insurance companies, and adhering to each insurance carrier's policies and

procedures.

The Process

Medical Billing Workflow

PATIENT

Medical Billing Software‘s are:

FRONT OFFICE PROVIDER

Medic

Medisoft

Medical Manager
MEDICAL
TRANSCRIPTION Medic +
Collections
SMS
Patient Follow up
MEDICAL
AR Scrubber Reports
CODING
ANALYSIS
Bomb Transmission

CASH AR Credentialing

CHARGE POSTING DEPARTMENT Appeal Follow up

ENTRY
Claim Status
AR
PAYMENT DENIAL
CALLING Denial Follow up

AR Follow up
CLAIMS
CARRIER
TRANSMISSION

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 Insurance

What is Insurance?

Insurance is a contract that exists between an organization & a person, to protect the

person from the losses or damage, that he might incur on account of the particular

risk or hazard, that has been stated therein in the contract. The person giving the

assurance is called the Insurer and the person who is receiving the protection is called

the Insured.

Definition: A contract that provides compensation for specific losses in exchange for

a periodic payment. An individual contract is known as an insurance policy, and the

periodic payment is known as an insurance premium.

Examples of the different types of insurance available are automobile, home, health

and worker's compensation. Whereas in most cases the insured is paid for their

loss, with life insurance a beneficiary is paid when the insured person passes away.

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 INSURANCE OVERVIEW

Insurance

Federal Insurance Private Insurance

Group Insurance

Individual Insurance

Liability Insurance Life Insurance

EGHP

General Liability LGHP

Health Insurance

Worker‘s Compensation SGHP

Auto Accident Plans Traditional Care

Managed Care

Medicare HMO

Medicaid PPO

CHAMPVA EPO

CHAMPUS POS

Railroad IPA
Medicare

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 Types of Insurance Providers

There are 2 types of insurance companies:

Public Insurance

Private Insurance

Public Insurance Companies

Public Insurance Companies are otherwise known as Federal Insurance Companies. They

are owned by the Federal Government. The insurer is the Government.

Private Insurance Organizations

These are privately owned & run organizations.

They are divided into:

Individual Insurance

Group Insurance

Individual Insurances Policies

They are insurances that give the subscriber control over the policy, premium &

coverage.

Group Insurances Policies

They are insurances that are applicable to a group of people. No individual subscriber

has control over the policy, premium & coverage.

Group coverage‘s are divided into:

EGHP (Employee Group Health Programs that covers a group of 20 – 100

people

LGHP (Large Group Health Programs) that covers a group of more than

100 people

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SGHP ( Small Group Health Programs) that covers a group of less than

20 people.

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 Types of Insurance Coverage

Any risk that can be quantified probably has a type of insurance to protect it.

They can be broadly classified into 3 types:

Life Insurance

Liability Insurance

Health Insurance

The different types of insurance are:

Life insurance provides a benefit to a decedent's family or other

designated beneficiary, to replace loss of the insured's income and

provide for burial and other final expenses.

Annuities provide a stream of payments and are generally classified as

insurance because they are issued by insurance companies and regulated

as insurance. In a sense, they are the opposite of life insurance.

Health insurance covers medical bills incurred because of sickness /

injury or accidents.

Liability insurance covers legal claims against the insured. For example,

a doctor may purchase insurance to cover any legal claims against him if

he were to be convicted of a mistake in treating a patient.

Automobile insurance, also known as auto insurance, car insurance and in

the UK as motor insurance, is probably the most common form of

insurance and may cover both legal liability claims against the driver and

loss of or damage to the vehicle itself.

Property insurance provides protection against risks to property, such as

fire, theft or weather damage. This includes specialized forms of

insurance such as fire insurance, flood insurance, earthquake insurance,

home insurance or boiler insurance.

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Casualty insurance insures against accidents, not necessarily tied to any

specific piece of property.

Financial loss insurance protects individuals and companies against

various financial risks. For example, a business might purchase cover to

protect it from loss of sales if a fire in a factory prevented it from

carrying out its business for a time. Insurance might also cover failure

of a creditor to pay money it owes to the insured. Fidelity bonds and

surety bonds are included in this category.

Title insurance provides a guarantee on research done on public records

affecting title to real property, usually in conjunction with a search

done at the time of a real estate transaction, such as a sale, or a

mortgage.

Credit insurance pays some or all of a loan back when certain things

happen to the borrower like unemployment, disability, or death.

Terrorism insurance covers liabilities that arise out of acts of

terrorism.

Political risk insurance can be taken out by businesses with operations in

countries in which there is a risk that revolution or other political

conditions will result in a loss.

Worker's Compensation insurance replaces all or part of a worker's

wages and accompanying medical expense lost due to a job-related

accident / injury.

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Liability Insurance

They are of 3 types:

General Liability

Worker‘s Compensation

Auto accident Plans

General Liability insurances

They generally cover liabilities arising out of fire, theft, marine & natural calamities.

They also provide house owner‘s insurance & shopkeepers insurance.

Worker‘s Compensation

They cover liabilities that occur due to accidents in the work place.

Features:

Employer insures all employee of the

organization thus reducing the risk of huge loss

Employer pays premium

Employee is the subscriber

Claims are filed along with, injury report,

ombudsmen report - report of the government, witness report,

provider‘s note, employer‘s note

Claims are sent in C4 forms

Claims are usually on paper

Payments are made in lump sum amounts

Insurance company, employer & the employee play an equal role.

WC Insurances are provided by Private Insurances, Public - Federal,

State Insurances & by the Employer

OWCP - Office of worker‘s compensation program ensure that employees

get a fair compensation. They identify risk prone areas & formulate

suitable regulations

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Auto Accident Plans

They cover liabilities that occur due to accidents involving vehicles.

Features:

Personal Injury Protection (PIP) SELF

Collision Coverage (Self‘s Property/vehicle)

Bodily Injury Liability (Damage to the other party)

Property Damage Liability (Damage to the other party‘s property/vehicle)

Comprehensive Coverage (Damages that occur to the vehicle due to events like -

storm, rioting etc)

Uninsured Motorists Coverage (Protection against damages if the other party

involved in the accident is uninsured)

No Fault Liability (Protection against accidents, irrespective of which party is

at fault)

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 Health Insurance

What is Health Insurance?

Introduction

In insurance, the insured makes payments called "premiums" to an insurer, and in

return is able to claim a payment from the insurer if the insured suffers a defined

type of loss. This relationship is usually drawn up in a formal legal contract, also known

as a policy. The contract will set out in detail the exact circumstances under which a

benefit payment will be made and the amount of the premiums.

For example, many individual people purchase health insurance policies and they each

pay a small monthly or yearly premium to an insurance company. When a policyholder

gets ill, the insurance company provides money to cover medical treatment. For some

individuals the insurance benefits may total far more money than they have ever paid

into the insurance policy. Others may never make a claim. When averaged out over all

of the people buying policies, value of the claims even out. Insurance companies set

their premiums based on their calculated payouts.

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Key Features

Health insurance is a protection against health / medical related costs

or damages.

Health insurance policy is a contract between an insurer and an individual

or group, in which the insurer agrees to provide specified health

insurance coverage to the insured, for an agreed fee (known as the

premium).

A person insured for health, means he is under Medical Insurance

coverage

We need health insurance -

Gone are the days when the physician accepted cash from all the patients directly,

immediately after the services were rendered, for the entire amount due for his

services. In the past medical service was affordable. But in the present scenario costs

of medical services are so high & mostly unaffordable to the middle & lower income

group. Here is where the insurance comes into picture.

Unique Features of American Health Industry

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Percentage of insured as compared to other countries is very high. More

than 95% of the population has health insurance coverage

High scope of coverage.

Availability of a wide range of Insurance plans. Approximately 30,000

plans are available

Apart from Physicians, unconventional groups such as the carriers,

transcriptionist, coders & the billing office are part of the health care

system

Standardization of health care practices – processes, documentations,

diagnoses, treatments etc.

Access to more than one insurance coverage per person

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Role of Medical Insurance

Manages high health care costs

Helps standardise health care thus improving the quality

Protects against risk of medical emergencies & uneventful expenditure.

Gives coverage against terminally ill diseases

Makes routine conditions requiring frequent hospital visits less expensive

Preventive health care management, a dream for most becomes a reality

Enables an organized approach to render health services

Prevents exploitation by providers

Improves of overall health

Differences between American and Indian Health care Industry

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 India USA

Negligible % of people insured Large % of people insured (more than 95%of

the population is insured)

Scope of coverage of plan is limited (pay Scope of coverage is high

first and claim later)

Filing of claims with the insurer is the Filing of claims with the insurer is the

responsibility of the insured responsibility of the providers

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 Types of Health Insurance
There are two types of health insurance:

Traditional Care

Managed Care

Traditional Care Insurance

Traditional Insurance coverage is a contract that exists between the insured and the

insurer with an understanding that the insurer will protect the insured from any

healthcare cost.

Salient Features of Traditional Care

The reimbursement by the insurer is a fixed % / fixed

amount

1. Patient liability is not fixed.

Insured have higher liabilities.

1. Preventive medicine is optional

No restrictions imposed on the enroller

No control over providers.

Higher freedom of choice for patients.

Patient liability is not fixed.

Limited Coverage.

Components of Traditional Care

Basic Coverage - This covers all kinds of emergency services, inpatient

services & some outpatient services.

Major Medical Coverage - This covers other supplementary uncovered

and outpatient services

Comprehensive Coverage - This includes both Basic and Major Medical

Coverage

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Managed Care Insurance

In this type of coverage the insurance company plays an active role in facilitating the

insured‘s health care activities. This in other words refers to a 3P program where the

provider, patient and the 3rd party administrator play an important role.

Salient Features of Managed Care Plans

Insure d's liability is a pre - fixed amt

Insurer‘s liability depends on the allowed amount for respective billed

amount which varies from carrier to carrier

Insured is given a network of providers

Participating provider most often renders the service

Referral /authorization number from the PCP is required, when seeing a

specialist (except for an obgyn)

Focus on preventive medicine is high

Types of Managed Care Plans

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 Health Maintenance Organization (HMO)

Preferred Provider Organization (PPO)

Exclusive Provider Organization (EPO)

Point of service (POS)

Independent or Individual Practitioner's Association (IPA)

Health Maintenance Organization (HMO)

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In a HMO plan a patient has to go through a group of network providers only.

Patient stands ineligible for coverage if treated by an out of network provide.

Patient needs to visit a PCP (Gate Keeper) first. If specialized care is necessary

needs to get a referral / authorization from the PCP. A Co pay or a pre-fixed

amount is charged to the patients for every service provided. This amount varies

from $5 to $25 only.

Salient Features

Only in network benefits

Treatment by out of network providers is ineligible. Considered only in the case

of emergencies

Co pay is applicable for all services

Monthly premium to be paid by the insured

In HMO 100% of the allowed amount is paid, if the provider is participatory

PCP is chosen by the patient & all health care activities are managed by him

Referral / Authorization is mandatory for all services, other than those

provided by the PCP

No Deductible is charged

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Preferred Provider Organization (PPO)

In a PPO plan the patient has both in-network benefits and out of network

benefits. Patient can visit any provider of his choice. Its not necessary for the

rendering provider to be in network. The payment structure varies for in-network

and out of network providers. A Deductible which is a pre-fixed amount is charged

apart from the premium. The deductible can be paid as a monthly, bimonthly,

quarterly, half-yearly or an annual amount. Reimbursements are done only if the

deductible is paid for that particular service period.

Salient Features

Both in network and out of network benefits

Patient liability is higher in case of out of network services

The payment structure is not 100%, it is 80% for an in network provider and

60%-70% for an out of network provider.

Deductible is applicable. Reimbursements done only if deductible is paid

Premium to be paid apart from the deductible

No co pay

Referral / Authorization is not mandatory

The geographical location of an out of network provider is restricted within a

city or certain area.

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Exclusive Provider Organization (EPO)

An EPO plan is one in which, a group of providers buy exclusively, HMO policies from

insurance companies and they themselves act as the insurance company. The EPO plan

is governed by all rules applicable to that HMO plan.

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Point of service (POS)

POS plan is a combination of HMO and PPO plans. The difference between PPO and

POS is that, in the POS there are no geographical restrictions (i.e Patient can see any

provider in any state or city). POS offers the combined advantage of both HMO & PPO

plans.

Salient Features

Self Referral by patient is allowed

Insured have the flexibility to decide on the type of service

In case of non-participating provider, the insured has to pay deductible or 30%

of the allowed amount (only 70% of the allowed amount is paid by the carrier)

Premium is higher than HMO & PPO

In case of out of network provider, service considered as per PPO plan &

Deductible is applicable

In case of in network provider, service considered as per HMO plan & Co-Pay is

Applicable.

Independent or Individual Practioner's Association (IPA)

An IPA plan is one in which, a group of providers buy all types of policies from

insurance companies and they themselves act as the insurance company. The IPO plan

is governed by all rules applicable to HMO, PPO & POS plans.

This plan is advantageous to health organizations for administrative & business reasons.

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Public Health Insurance Companies

Public Insurance Companies are otherwise known as Federal Insurance Companies. They

are owned by the Federal Government. The insurer is the Government.

List of US Federal Insurance Organizations:

Medicare

Medicaid

Champva

Champus

Railroad Medicare

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 Medicare

Basic Eligibility for coverage under Medicare:

Citizen of the United States.

Legal Alien.

65 or under 65 years of age.

Over 65 years and disabled.

65 or under 65 years and ESRD patients (End stage Renal Disorders). This act

was implemented from 1972.

You are receiving retirement benefits from Social Security or the Railroad

Retirement Board.

You are eligible to receive Social Security or Railroad benefits but have not yet

filed for them.

You or Your spouse have Medicare-covered Government employment.

You are entitled to Social Security or Railroad Retirement Board disability

benefits for 24 months.

You are a kidney dialysis or kidney transplant patient.

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Medicare has 3 parts

Part-A : Medicare Part A or Hospital Insurance helps cover your inpatient

care in hospitals, critical access hospitals and skilled nursing facilities. It also covers

hospice care and some home health care.

Part-B : Medicare Part B or Medical Insurance helps cover your doctor‘s

services, outpatient hospital care, and some other medical services that Part A does

not cover, such as some of the services of physical and occupational therapists, and

some home health care. Part B helps pay for those covered services and supplies when

they are medically necessary.

Part-C : Medicare + Choice Plans. Medicare Part C offers all

medicare benefits along with benefits of another plan of your choice. The

choice is to be made from a list of plans provided by Medicare.

Medicaid

Features of Medicaid:

Medicaid is a state-funded health care assistance program for the lower income

group and disabled persons. Medical bills are paid from federal, state and local

tax funds.

For Citizens of the United States or legal aliens.

All rules are state governed & differ from stat to state.

No patient liability.(Sometimes a small co-payment is required.)

Covers lower income group people, below the state‘s poverty line ofall ages.

A person is below the poverty line if his total property taken together is below

$4000 for an individual and $6000 for a family.

Medicaid cards are issued by HCFA and are renewed every month.

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 Champus

Champus stands for Civilian health and medical programme for uniformed services.

This coverage is for uniformed services personnel.

Champva

Champva stands for Civilian health and medical programme for veteran

administration. It covers people retired from uniformed services.

Railroad Medicare

Covers those who work for the railways department.

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 Health Insurance Processes

Health Insurance Processes Related to the Provider

Claim Adjudication:

Adjudication is the process of processing claims for either payment or denial by the

Utilization Review Department of the insurance company.

The Carrier‘s Utilization Review Department, reviews the claim and after verification,

the claim is adjudicated or processed for payment / denial. The check and an / or

Explanation of Benefits are sent to the provider / billing office.

Features of the Utilization Review Department:

1. Insurance companies use automated claims processing which provide them with

better record retention and immediate access to a participant‘s entire claims

history.

2. Insurance companies prefers claims submission by fax and they provide toll free

fax lines for that purpose, all claims and documentation received by any means

are date-stamped, numbered, scanned and electronically logged on to the

participant‘s file.

3. Insurance companies also prefer claims submission electronically and few prefer

paper claims.

4. Properly completed claims are automatically adjudicated within 48 hours of

receipt and payment is released according to the client‘s reimbursement

schedule.

Utilization Management Department:

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Managed care plans define Utilization Management (UM) as getting the patient

the right services, at the right time, for the right price. Since the decision to

approve or deny a service can have a significant effect on a patient's medical

outcomes.

UM departments are typically staffed with nurses of backgrounds in various

clinical specialties and training in case management techniques. A medical

director usually oversees the UM operation. He or she is responsible for

reviewing problem cases, making determinations of medical necessity (deciding

whether a service was needed to avoid death, disability or worsening of a

medical condition) and monitoring plan quality programs.

In the course of the referral process the PCP sends clinical information to the

specialist or testing facility and also notifies the managed care plan that a

referral has been authorized. Many plans require the PCP to specify the number

of allowed visits or an authorized time period for the referral. For example,

the PCP might authorize 10 physical therapy visits or a referral that is valid

for one month.

The patient is responsible for obtaining a referral from the PCP. Specialists can

legitimately refuse to see or bill patients who come to a visit without a

referral. The managed care plan enters referral authorizations into its UM

computer system. This information is stored until a claim is received. The claim

is only paid if the service delivered matches the service authorized by the PCP.

Pre Certification – It is the plan authorization for a hospital stay or an

expensive procedure. Typically, a physician or an office staff member calls the

plan‘s Utilization Management Department to report a planned hospitalization.

The phone number for this department is usually printed on the member's card.

Using plan guidelines (which are often computerized), plan UM staffs approve or

deny the admission. As part of the approval process an authorized length of

stay (LOS) is assigned. The LOS is number of days the patient is expected to

remain in the hospital. If the hospital stay exceeds the number of days

authorized, further approval must be sought from the plan.

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 Prior authorization - The process of seeking advance approval for expensive or

complex testing or treatment. A physician or staff member calls the Utilization

Management department of the managed care organization to request

authorization of a test or treatment. After reviewing the patient's history and

the physician's findings, plan clinical staffs either approve and authorize the

requested treatment or deny coverage. An authorization number (a unique

number provided by the plan UM Department to verify that the service was

authorized) may be provided to the medical practitioner if the service is

approved. The authorization number must be placed on the claim submitted by

the provider so the claims processing department knows that the services was

properly authorized. Prior authorization may also be used in other circumstances

such as approval of visits to a non-participating provider.

Emergency Room Visit authorization- Plans are required to waive the ER

authorization rule in cases of "life threatening medical emergencies." In these

cases, patients or family members are required to notify the plan of ER visits

within 24-48 hours

Medical Review:

It consists of a group of medical professionals like nurses, doctors etc.

The medical professionals investigate the claim sent to them, for criteria

like medically necessary, medical records & injury report (if it is an accident

related treatment)

The assessment of the claim is done as per the state‘s medical rules and

regulations

The assessment is then sent to the claims department for adjudication or

review

Credentialing:

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 It is the process of enrolling or enlisting providers with an

insurance company

Providers need to fill the enrollment form and sign an agreement

for enrollment

Providers need to update themselves on any change in the

contract on a regular basis with the insurance company

Capitation:

It is a contract between the insurance company and the provider

Capitation Payment means a payment the STATE makes

periodically to the provider for each Enrollee covered under the Contract

for the provision of services regardless of whether the Enrollee receives

these services during the period covered by the payment.

Claims will be denied and denied as capitation and adjusted as

payment is already been paid in advance.

Billed Amount:

This is the amount charged by the provider for the services rendered by him. Each

and every treatment / procedure/ service has a standard billed amount which is

determined by AMA

Approved Amount:

Approved amount also called, as the allowed amount is the actual amount paid

against each billed amount by the insurance company. This amount is predetermined

by each insurance company and varies from company to company

Paid Amount:

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The amounts paid to providers to satisfy the contractual liability of the carrier or

plan sponsor. These amounts do not include any member liability for ineligible

charges or for deductibles or co-payments.

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 Health Insurance Processes Related to the Patient

Deductible:

Deductible is the amount to be paid periodically (monthly, bimonthly,

quarterly, half yearly or annually) apart from the premium by the

insured to the carrier

Services are reimbursed only if this amount is paid for the given period

in which the service is rendered

Co Pay:

Co pay is a pre-fixed amount charged to the patients for every

service provided

This amount ranges approximately between $5 to $25 or more.

All HMO policy holders are responsible to pay Copay

Maximum benefits:

It is the maximum benefits or coverage given by an insurance company

to the subscriber for his service.

Insurance companies will deny the claim if the benefits have exceeded

the maximum allowed.

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 Federal Forms

Federal forms are basically known as HCFA forms and HCFA stands for The Health

Care Financing Administration.

There are two major forms used in MEDICAL BILLING.

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1. HCFA 1500

The HCFA 1500 forms are designed for providers to file a medical claim with the

patient's insurance carrier to claim professional charges. This form consists of 33

slots.

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2. UB 92 FORMS or HCFA 1450

The UB-92 forms are designed for hospitals, nursing homes, and clinics to file a

medical claim with the patient's insurance carrier to claim all technical charges (non

professional). This form consists of 86 slots.

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HCFA 1500 FILING INSTRUCTIONS

Block 1-13 - Patient and Insured Information.

Block 1. Enter the type of health insurance coverage applicable to the claim by

checking the appropriate box, e.g., to file a Medicare claim check the Medicare box.

Block 1a. Enter patient‘s Medicare Health Insurance Claim Number (HICN) irrespective

of whether Medicare is the primary or secondary payer.

Block 2. Enter patient‘s last name, first name, and middle initial, if any, as shown on

the patient‘s insurance card.

Block 3. Enter the patient‘s date of birth and gender.

Block 4. In case of any other insurance being primary other than Medicare, either

through the patient or spouse‘s employment or any other source, list the name of the

insured. If the insured and the patient are the same, enter the word SAME. If

Medicare is primary, leave blank.

Block 5. Enter patient‘s mailing address and telephone number. On the first line enter

the street address; the second line, the city and state; the third line, the ZIP code

and phone number.

Block 6. Check the appropriate box for patient‘s relationship to insured after

completing Block 4.

Block 7. Enter the insured‘s address and telephone number. When the address is the

same as the patient‘s, enter the word "SAME."

Complete this Block only after Blocks 4 & 11 are completed.

45
Block 8. Check the appropriate box for the patient‘s marital status and whether

employed or a student.

Block 9. Enter the last name, first name, and middle initial of the enrollee in a

Medigap policy, if it is different from that shown in Block 2. Otherwise, enter the

word SAME. If no Medigap benefits are assigned, leave blank. This field may be used

in the future for supplemental insurance plans.

Block 9a. Enter the policy and/or group number of the Medigap insurer preceded by

Medigap

Block 9b. Enter the Medigap insurer‘s date of birth and gender.

Block 9c. Leave blank if a Medigap *PAYERID is entered in Block 9d. Otherwise, enter

the claims processing address of the Medigap insurer. Use an abbreviated street

address, two-letter postal code, and zip code copied from the Medigap insurer‘s

Medigap identification card.

For example:

1257 Anywhere Street

Baltimore, Maryland 21204

Is shown as ―1257 Anywhere St MD 21204."

Block 9d. Enter the nine-digit PAYERID number of the Medigap insurer. If no

PAYERID number exists, then enter the Medigap insurance program or plan name.

Block 10a Check ―YES‖ or ―NO‖ to indicate whether employment, auto liability, or thru

other accidents applies to one or more of the services described.

Block 10c. In Block 24. Enter the state postal code. Any Block checked ―YES,‖

indicates the existence of another insurance primary to Medicare. Identify primary

insurance information in Block 11.

Block 10d. Use this Block exclusively for Medicaid (MCD) information. If the patient is

entitled to Medicaid, enter the patient‘s Medicaid number preceded by "MCD."

46
Block 11. THIS BLOCK MUST BE COMPLETED. BY COMPLETING THIS BLOCK, THE

PHYSICIAN/SUPPLIER ACKNOWLEDGES HAVING MADE A GOOD FAITH EFFORT TO

DETERMINE WHETHER MEDICARE IS THE PRIMARY OR SECONDARY PAYER.

If there is an insurance primary to Medicare, enter the insured‘s policy or group

number and proceed to Blocks 11a - 11c.

Block 11a. Enter the insured‘s date of birth and gender if different from Block 3.

Block 11b. Enter employer‘s name, if applicable. If there is a change in the insured‘s

insurance status, e.g., retired, enter the retirement date preceded by the word

―RETIRED.‖

Block 11c. Enter the nine-digit PAYERID number of the primary insurer. If no

PAYERID number exists, then enter the complete primary payer‘s program or plan

name. If the primary payer‘s EOB does not contain the claims processing address,

record the primary payer‘s claims processing address directly on the EOB.

Block 11d. Leave blank. Not required by Medicare.

Block 12. The patient or authorized representative must sign and date this Block unless

the signature is on file. In lieu of signing the claim, the patient may sign a statement

to be retained in the provider, physician, or supplier file in accordance with §§3047.7-

3047.3. If the patient is physically or mentally unable to sign, a representative

specified in §3008 may sign on the patient‘s behalf. In this event, the statement‘s

signature line must indicate the patient‘s name followed by ―by‖ the representative‘s

name, address, relationship to the patient, and the reason the patient cannot sign.

The authorization is effective indefinitely unless patient or the patient‘s representative

revokes this arrangement. The patient‘s signature authorizes release of medical

information necessary to process the claim. It also authorizes payment of benefits to

the provider of service or supplier, when the provider of service or supplier accepts

assignment on the claim.

Signature by Mark (X) - When an illiterate or physically handicapped enrollee signs by

a mark, a witness must enter his/her name and address next to the mark.

47
Block 13. The signature in this Block authorizes payment of mandated Medigap

benefits to the participating physician or supplier. If required Medigap information is

included in Block 9 and its subdivisions. The patient or his/her authorized

representative signs this Block, or the signature must be on file as a separate Medigap

authorization. The Medigap assignment on file in the participating provider of service /

supplier‘s office must be insurer specific. It may state that the authorization applies

to all occasions of service until it is revoked.

Blocks 14-33 - Provider of Service or Supplier Information

Block 14. Enter the date of current illness, injury, or pregnancy. For chiropractic

services, enter the date of the initiation of the course of treatment and enter the

X-ray date in Block 19.

Block 15. Leave blank. Not required by Medicare.

Block 16. Enter date from which patient is employed and unable to work in current

occupation. An entry in this field may indicate employment related insurance coverage.

Block 17. Enter the name of the referring or ordering physician if the service or item

was ordered or referred by a physician. Referring Physician: A physician who requests

an item or service for the beneficiary for which payment may be made under the

Medicare Program. Ordering Physician: A physician who orders non-physician services

for the patient such as diagnostic laboratory tests, clinical laboratory tests,

pharmaceutical services, or durable medical equipment.

Block 17a. Enter Nation provider identifier number of the referring/ordering physician

listed in Block 17.

Block 18. Complete this Block when a medical service is furnished as a result of, or

subsequent to, a related hospitalization.

48
Block 19. Enter the date the patient was last seen and the NPI of his/her attending

physician when he/she is an independent physical or occupational therapist or physician

providing routine foot care.

Block 20. Complete this Block when billing for diagnostic tests subject to purchase

price limitations

Block 21. Enter the patient‘s diagnosis/condition.

Block 22. Leave blank. Not required by Medicare.

Block 23. Enter prior authorization number

Block 24a. Enter the month, day and year for each procedure, service, or supply.

When ―from‖ and ―to‖ dates are shown for a series of identical services, enter the

number of days or units in column G.

Block 24b. Enter the appropriate place of service

Block 24c. Medicare providers are not required to complete this Block.

Block 24d. Enter the procedures, services or supplies.

Block 24e. Enter the diagnosis code reference number as shown in Block 21, to relate

the date of service and the procedures performed to the primary diagnosis. Enter only

one reference number per line Block. When multiple services are performed, enter the

primary reference number for each service a 1, 2, 3, or 4.

If a situation arises where two or more diagnoses are required for a procedure code

(e.g. Pap Smears), you must reference only one of the diagnoses in Block 21.

Block 24f. Enter the charge for each listed service.

Block 24g. Enter the number of days or units. This field is most commonly used for

multiple visits, units of supplies, or anesthesia minutes. If only one service is

performed, the numeral "1" must be entered.

49
Block 24h. Leave blank. Not required by Medicare.

Block 24i. Leave blank. Not required by Medicare.

Block 24j. Enter the NPI {national provider identifier} of the performing provider of

service/supply if they are a member of a group practice.

Block 24k. NOTE: Enter the first two digits of the NPI in Block 24j. Enter the

remaining six digits of the NPI in Block 24k,

Block 25. Enter your provider of service or supplier, Federal Tax I.D. (Employer

Identification Number) or Social Security Number. The participating provider of

service or supplier Federal Tax I.D., Number is required for a mandated Medigap

transfer.

Block 26. Enter the patient‘s account number assigned by the provider of service or

supply.

Block 27. Check the appropriate block to indicate whether the provider of service or

supplier accepts assignment of Medicare benefits.

Block 33. Enter the provider of service/supplier‘s billing name, address, zip code, and

telephone number.

UB92 FORM

50
UB92 FORM FILLING INSTRUCTIONS NEW.XLS

Medical Terms Procedures & Documentation Overview

Human Anatomy:

51
Departments of Medicine

1. Emergency Medicine:

The branch of medicine that deals with evaluation

and initial treatment of medical conditions caused

by trauma or sudden illness.

52
2. Pathology:
The branch of medical science that studies the causes, nature

and effects of diseases.

3. Radiology:

The science of diagnosis and/or treatment using radiant energy.

Includes X rays, CT scan, and destruction of tumors by

radiation.

53
 A radiologist uses x-rays, radiant dyes, nuclear medicine,

ultrasound, and magnetic resonance imaging to "photograph" the

skeletal, arterial and soft tissue areas of the body to diagnose

and treat disease or injury

4. Surgery:

The art of healing by manual operation.

That branch of medical science, which treats of manual
operations for the healing of diseases or injuries of the
body.

5. Cardiology:

The medical study of the structure, function, and disorders of the

heart

54
6. Internal Medicine:

The branch of medicine that deals with the diagnosis and nonsurgical

treatment of diseases affecting the internal organs of the body,

especially in adults.

Endoscopy

7. Family Medicine:

The branch of medicine that deals with provision of comprehensive

health care to people regardless of age or sex while placing

particular emphasis on the family unit. Also called family practice.

55
8. Gastroenterology:

The branch of medicine dealing with the study of disorders affecting

the stomach, intestines, and associated organs

9. Oncology:

The branch of medicine that deals with tumors, including study of

their development, diagnosis, treatment, and prevention

56
57
MEDICAL DOCUMENTATION:

Medical Record

Clinical Data Record

58
Narrative Notes

59
60
61
62
 Medical Coding

There are 2 types of Medical codes:

CPT CODES

ICD CODES

CPT CODES

CPT Coding Fundamentals

CPT is an acronym for Current Procedural Terminology. Physician's Current Procedural

Terminology, Fourth Edition, known as CPT-4 or more commonly CP1, is a systematic

listing of codes and descriptions which classify medical services and procedures. CPT

codes are used by physicians, hospitals, and other health care professionals, to report

specific medical, surgical and diagnostic services and procedures for statistical and

third party payment purposes.

The CPT coding system is maintained by the American Medical Association (AMA)
and a revised edition of the CPT book is published each fall. The new CPT codes

become effective on January 1 st of the following year. The revisions in each new

edition are prepared by the CPT Editorial Panel with the assistance of physicians

representing all specialties of medicine.

A thorough understanding of the CPT coding system is essential in order to accurately

report medical services and procedures, maximize payments from third parties,

minimize denials, rejections and reductions from third parties, and to protect the

medical practice from audit liability.

63
Key Points of the CPT Coding System

A provider or coder using the CPT coding system for coding, first chooses the name

and associated code of the procedure or service which most accurately identifies and

describes the service( s) performed. The provider or coder then chooses names and

codes for additional services or procedures. If necessary, modifiers are chosen and

added to the selected service and procedure codes. All services or procedures coded

must also be documented in the patient's medical record.

According to CPT 2002, The listing of a service or procedure and its CPT code number

in a specific section of the CPT coding system does not restrict its use to a specific

specialty or group. Any procedure or service in any section of the CPT coding system

may be used to report the services rendered by any qualified physician or other health

care professional."

The codes and descriptions listed in the CPT coding system are those that are

generally consistent with contemporary medical practice and being perfonned by health

care professionals in clinical practice. Inclusion in the CPT coding system does not

represent endorsement by the American Medical Association of any particular

diagnostic or therapeutic procedure. In addition, inclusion or exclusion ofa procedure

does not imply any health insurance coverage or reimbursement policy.

64
CPT codes describe medical procedures, services and supplies

All CPT codes are five digit codes

CPT codes are mandated by federal law for Medicare, Medicaid, CHAMPUS and

Federal Employee Health Plan (FE HP) reporting and are accepted or required

by all other third party payers

CPT codes are self-definitive, with the exception of CPT codes for unlisted

procedures and or the few CPT codes which include the term specify, in the

description

Each CPT code number represents the universal definition of a service or

procedure

CPT codes are revised and updated annually by the AMA and the revisions

become effective on the 1 st of January every year. Hundreds of CPT codes

are added, changed or deleted each year. All health care professionals, third

party payers, and health care facilities must maintain copies of the current

code books.

Accurate CPT coding provides an efficient method of communicating medical,

surgical and diagnostic services and procedures among health care professionals,

health care facilities, and third party payers.

Accurate CPT coding enhances the health care provider's control of the

reimbursement process.

65
Structure of the CPT Coding System
The CPT coding system includes over 7,900 codes and definitions for medical services,

procedures and diagnostic tests. Each procedure or service is identified by a five digit

code, followed by the definition.

The CPT coding system is divided into seven Sections. The seven sections of are:

Evaluation and Management - 99200-99499

Anesthesiology - 00100-01999

Surgery - 10000-69999

Radiology - 70000-79999

Pathology and Laboratory - 80000-89999

Medicine - 90000-99199

Category III Emerging Technology- 0001T-0026T

Each section of the CPT book includes subsections with anatomic, procedural, condition,

or descriptor subheadings. The Evaluation and Management (E/M) section is presented

first because

1) These codes are used by virtually all health care providers

2) They are the most frequently used CPT codes.

66
 ICD CODES

ICD Codes are the International Classification Of Diseases codes or Diagnosis Codes.

ICD-9-CM is an acronym for International Classification of Diseases, 9th Revision,

Clinical Modification, published under different names since 1900. ICD-9-CM is a

statistical classification system that arranges diseases and injuries into groups

according to established criteria. Most ICD-9-CM codes are numeric and consist of

three, four or five numbers and a description. The codes are revised approximately

every 10 years by the World Health Organization and annual updates are published by

the Centers for Medicare and Medicaid Services (CMS).

The concept of extending the International Classification of Diseases for use in

hospital indexing was originally developed in response to a need for a more efficient

basis for storage and retrieval of diagnostic data. In 1950, the U.S. Public Health

Service and the Veterans Administration began independent tests of the Inlernational

Classification of Diseases for hospital indexing purposes.

In view of the growing interest in the use of the International Classification of

Diseases for hospital indexing, a study was undertaken in 1956 by the American

Medical Association and the American Medical Record Association of the relative

efficiencies of coding systems for diagnostic indexing. Following this study, the major

uses of the International Classification of Diseases for hospital indexing purposes

consolidated their experiences and an adaptation was published in December 1959. A

revision containing the first "Classification of Operations and Treatments" was

published in 1962.

Note: ICD Codes are available online software.

67
 MODIFIERS
Modifiers can be classified into two types:

CPT Modifiers

Healthcare common procedural coding system (HCPCS)

CPT Modifiers
The CPT coding system includes two-digit modifier codes which are used to report that

a service or procedure has been "altered or modified by some specific circumstance"

without altering or modifying the basic definition or CPT code.

The proper use of CPT modifiers can speed up claim processing and increase

reimbursement, while the improper use of CPT modifiers may result in claim delays or

claim denials. In addition, using certain CPT modifiers, for example -22, too often may

trigger a claims audit.

Examples of a few most commonly used CPT Modifiers :

-21 - Prolonged evaluation and management services.

-22- Unusual Procedural Services

-25- Significant, individually identifiable evaluation and management service by

the same physician on the same day of a procedure or service.

-26- Professional component.

-50- Bilateral Procedures

-51- Multiple Procedures

-52— Reduced services.

-57— Decision for surgery

-62- Two Surgeons

-76— Repeat procedure by same physician.

-80— Assistant surgeons

-99— Multiple modifiers

68
HCPCS Modifiers
HCPCS modifiers are defined and managed by the centers for Medicare and Medicaid

(CMS). Formerly known as HCFA, they are two digit modifiers / codes which alpha or

alphanumeric. HCPCS modifiers are used to modify procedures and services on health

insurance claim forms filed for Medicare patients.

HCPCS modifiers may be added,deleted or changed in each new edition of HCPCS,

therefore, providers should acquire and review the most current edition of HCPCS each

year.HCPCS modifiers may be LEVEL II,which are used nationally or LEVEL III, which

are used only by local Medicare intermediary.

HCPCS LEVEL II MODIFIERS:

-AA

Anesthesia services by anesthesiologist.

-AR

Ambulance return trip.

-E1

Upper left, eyelid.

-E4

Lower right, eyelid.

-Q6

Service furnished by a Locum Tenens physician.

69
 PLACE OF SERVICE CODES

Listed below are the POS codes and descriptions. These codes should be used on

preofessional claims to specify the entity where services were rendered.

11 - Office

Location, other than a hospital, skilled nursing facility (SNF), military treatment

facility, community health center, State or local public health clinic or intermediate

care facility (ICF), where the health professional routinely provides health

examinations, diagnosis, and treatment of illness or injury or an ambulatory service.

12 - Home

Location, other than a hospital or other facility, where the patient receives care in a

private residence.

21 Inpatient

A Hospital / a facility, other than psychiatric, which primarily

provides diagnostic, therapeutic (both surgical and nonsurgical), and rehabilitation

services by, or under, the supervision of physicians to patients admitted for a variety

of medical conditions.

22 Outpatient

Hospital

A portion of a hospital which provides diagnostic, therapeutic (both surgical and

nonsurgical), and rehabilitation services to sick or injured persons who do not require

hospitalization or institutionalization.

23 Emergency Room

Hospital

A portion of a hospital where emergency diagnosis and treatment of illness or injury is

provided.

24 Ambulatory

Surgical Center

70
A freestanding facility, other than a physician's office, where surgical and diagnostic

services are provided on an ambulatory basis.

31 Skilled Nursing Facilities

A facility, which primarily provides skilled nursing care and related services to patients

who require medical, nursing, or rehabilitative services but not the level of care or

treatment available in a hospital.

34 Hospice

A facility, other than a patient's home, in which palliative and supportive care for

terminally ill patients and their families are provided.

Codes: E & V

E codes denotes Injury

V codes denotes general illness

71
 The Billing Process

Departments in a Billing Office

Scanning

Pre Coding

Coding

Charge Entry

Audit

Claims Transmission

Payment Denial

Cash Application Quality Compliance AR Department

A.R. Analysis

A.R. Calling

AR Follow up

72
 Step – 1 - Doctor‘s Office

Patient visits doctor and explains his/her problem

Doctor evaluates patients condition

Determines the diagnoses of the illness / injury

Draws a treatment plan based on the diagnosis

Step – 2 - Documentation at the Front Desk

Patient hands over health insurance card copy

Front office manager verifies patient‘s insurance status

Documents patient‘s demographic details

Referral or pre-authorization is obtained from patient‘s Primary Care

Physician (Gatekeeper) if mandatory by the insurance company

Step – 3 - Transcription

The medical records are sent by the Physician‘s Office to the Medical

Transcriptionist

Medical Transcriptionists convert the voice files (medical records) into

data files

Step- 4 - Scanning

Demographics, charge sheets, super bills, insurance verification data and

a copy of the insurance card i.e. all information pertaining to the patient,

are sent to the billing office

All documents are scanned at the Billing office & stored in a central

database

73
Step – 5 - Precoding

The medical records are sent as data files by the Transcriptionists to

the Coders

Pre-coders enter the key-in codes for

Insurance companies

Doctors

Modifiers

Step – 6 - Medical Coding

Medical Coders assign the Alpha / Numeric codes.

The diagnostic records are assigned ICD codes – International

Classification of diseases Codes

The treatment or procedure records are assigned CPT codes – Current

Procedural Terminology Codes

Step – 7 - Charge Entry

Patient‘s personal information is entered from the Demographic sheets

All the details of the procedure are entered in two formats. The Charge

Sheet & the Super Bill

The relevance of the CPT codes to the ICD codes is verified.

A charge / claim is created, in line with the billing rules pertaining to

specific carriers and locations.

All charge entries are accomplished within the agreed turnaround time

with the client, which is generally 24 hours.

74
Step – 8 - Audit

Billing Errors

The daily charge entry is audited to double check the accuracy of the

entry / claim, thus ensuring that the billing rule is being followed

accurately.

The verification also ensures the accuracy of the claims, based on the

carrier‘s requirements to ascertain a clean claim.

75
Step – 9 - Claims Transmission

Direct Transmission Indirect Transmission

Billing Billing
Office Office

Clearing
House

Carrier Carrier

Claims are filed and information sent to the Claims Transmission

department

Paper claims & Electronic claims are segregated

Confirmation reports are obtained for claims transmitted electronically,

and filed after verification

Paper claims are printed and attachments done if necessary and mailed

Transmission rejections are analyzed and appropriate corrective actions

are taken

Step – 10 - Carrier Adjudication

In the Insurance Company the claim is received and kept on file

The Claims Department, of the insurance company reviews the claim

On completion of verification by the claims department, the claim is

adjudicated or processed for payment.

An EOB (Explanation of Benefits), which gives details of the reasons for

payment or denial, is sent to the provider / billing office.

76
Step – 11 – Payment - Cash Application

If the claim is paid, it is then sent to the Cash Applications department

of the billing office

Cash Applications team receives the cash files (Check Copy & EOB) from

the insurance company

The cash or credits received are applied (credited) to the respective

patients account (in the billing software)

During cash application, overpayment's are identified and necessary

refund requests generated

Underpayments & denials are informed to the Analysts

77
Step – 12 – Denial – AR Analysis
If a claim is denied or underpaid, it is sent to the AR department of the

billing office

AR Analysts research & analyze the EOB for understanding denial issues

Work orders are set up for the AR Callers to make calls

AR analysts are responsible for the cash collections and resolving of all

issues so as to enable the account to have a clean AR (accounts

receivable zero)

They also research claims for completeness and accuracy, rejections

received from the clearing house, low payment by the carriers and take

appropriate actions

Analysts also review for global patterns and bulk problems

Step – 13 – AR Calling

Once a work order is set by the analyst for the caller, the caller

initiates a call to the Insurance Company and verifies the claim and its

current status

The caller gives inputs to the analysts on the claim status as to whether

it is being processed for payment or denial

Based on these inputs the analyst gets the required pre-requisites

In case of payment a list of payment details is compiled

If it‘s a denial then corrective action is initiated

All reasons are passed on to the analysts for resolution

Step – 14 - Compilation

All information pertaining to the patients account is compiled in an Excel

Sheet and stored in the data bank for future use

Global AR patterns are derived from this information

78
 Step – 15 - Month End Reports

Reports are analyzed every month

The momentum achieved for the month is determined

Patterns for non-payment are ascertained & bulk pending issues tackled

Step – 16 - Confidentiality of Information

Electronic processing and transfer of data via multiplex /router/ modem is

encrypted and password protected to ensure privacy and confidentiality

Dedicated leased lines and Firewalls ensure security of data

Compliance with The Health Insurance Portability and Accountability Act of

1996 (HIPAA) is ensured

Confidentiality is maintained for all patient information provided by the client

79
 AR – Account Receivables Issues

Introduction:

Definition: Accounts Receivable may be defined as the total amount of money owed to

a practice for services rendered but not yet paid for by the patient or the carrier.

The AR Department is responsible for following up with the patients and carriers on

unpaid accounts.

AR issues can be explained as claim denials by a carrier due to inaccurate or

incomplete claim processing. Its is sent to the billing office in the form of an EOB. It

is usually identified by the caller / analyst. The most important criteria is identifying

the issue. In order to identify an issue the caller should be well equipped with

knowledge of all the issues that may arise in AR Calling.

The provider has open accounts receivable (A/R) cases where the insurance company or

patient has been billed and some amount is still outstanding from the insurance or

patient. Managing account receivables is nothing but collecting the outstanding amount.

80
AR ANALYSIS:

Analyzing an account would result in the next stage of adjudicating a call to the

carrier. Proper analysis is the first hurdle for an AR Executive. An account needs to

be analyzed before the carrier is called. For every claim on file & adjudicated by the

carrier, either payment or denial happens. This explanation is given in the form of an

EOB. Depending on this, a call is made to the carrier to resolve denials.

AR CALLING:

After analysis of a denial, the caller calls the carrier. Once a call is initiated the

outcome of the call is nothing but identifying the issue. Necessary actions that need to

be taken are decided depending on the issue. Hence identifying the issue carries the

maximum importance in AR Calling.

81
Identifying & Solving AR Issues:

AR Issues are identified, addressed and actions taken appropriately.

When a claim is filed with the carrier and the claim is on file at the insurance company

(i.e., the claim is in the insurance company‘s system), the outcome should be either a

denial or a payment. If we receive a denial or a low payment or if we do not receive

any information from the insurance company within the usual claims processing time, a

call is initiated to the carrier to check the status of the filed claim.

Outcome of the call:

The outcome of a call is to identify the issue and take appropriate actions. The issue

involves all type of denials, payments and all other outcomes of the call. Each of these

issues are handled separately and actions taken appropriately.

82
 1 - CLAIM NOT ON FILE

Issue:

No response from the carrier on the status of a claim within the usual

processing time. (Usually 45 days from the date of submission of claim).

The claim is not on file or claim not in system

Course of Action:

Step –1

Caller needs to verify the following:

Claims mailing address: The address to which the claim was sent. The reason

for verifying is to identify the correct claims mailing address of the carrier

Claims filing limit: Filing limit is a time limit within which the carrier should

receive the claim. It varies from carrier to carrier.

If claim filed within filing limit, then to attach proof of timely filing. A

softcopy (screen shot) of the page showing the original filing details (that the

claim was submitted within the filing time limit) to be sent to the carrier.

If carrier does not accept computer screen shot as proof for timely filing, then

to send the Scrubber Report from the clearinghouse

Claims acceptance thru Fax. If yes, to get the fax number & name of the

contact person

Electronic or Paper: For Claims accepted electronically to get electronic claims

payer ID #. (Five-digit number for electronic claims submission)

Step – 2

To refile the claim after verification of all the above details

Note: Insurance companies that require NEIC report for electronic submissions

are: Blue, PHS

Insurance companies that ask for a certified mail receipt for original

submission: Fidelis

All other insurance companies accept computer screen print as proof of timely

filing

83
 2- UNTIMELY FILING

Issue:

Claim filed after filing limit or untimely filing

Course of Action:

Step –1

If claim filed within filing limit, then

To attach proof of timely filing. A softcopy (screen shot) of the page showing

the original filing details (that the claim was submitted within the filing time

limit) to be sent to the carrier

If carrier does not accept computer screen shot as proof for timely filing, then

to send the Scrubber Report from the clearinghouse

To verify claims acceptance thru fax. If yes, to get the fax number & name of

the contact person

For electronic or paper claims, to get electronic claims payer ID #. (Five-digit

number for electronic claims submission)

To refile the claim after verification of all the above details

Step – 2

If claim filed beyond filing limit, then

To get the claim denial date and the claim #. Carriers deny claims filed after

the filing time limit

To verify whether refiling claim with original filing details is sufficient or an

appeal is mandatory

If an appeal is mandatory, to get appeal address & appeal filing limit. Verify

the same with the data available in the provider par information sheet

84
 3 - CLAIM IN PROCESS

Issue:

The carrier is processing claim. The filed claim is within the claims processing

time of the carrier. The status of such a claim is termed as claim in process

Course of Action:

Step –1

Any additional information to be obtained from the provider, which is necessary

for processing the claim, is to be obtained from the provider

Caller to initiate a call to the provider and obtain the required information

To send the information electronically or through fax to the carrier

Step – 2

To send the claim for reprocessing

To get the date of claim receipt, carrier claim processing time and claim #.

To request a copy of the EOB

85
 4 – CLAIM PAID

Issue:

Claim as already paid

When the carrier processes a claim for payment, the payment is sent by check

along with the EOB to the provider‘s / billing office. If such a payment is not

received by either office, then the claim is sent for AR follow-up

Course of Action:

Step –1

To confirm if the claim has been paid

To check the following for paid claims: Allowed amount, Paid amount, Co-pay,

Co-insurance, Write-off, Check#, Address to which the check has been sent

(pay-to address)

To verify whether the check has been cashed or not

Step – 2

If check mailed to a different address then to request a copy of the Cancelled

check (Front and back) along with the EOB

To send a W9 form to the provider‘s office

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 5- ELIGIBILITY

Eligibility issue is classified into four different kinds.

(A) Patient cannot be identified as insured:

Issue:

Patient cannot be identified as insured

The claim is not on file or claim not in system

Course of Action:

Step –1

Caller needs to verify the following in the given order:

Patient‘s SSN, DOB, Last Name, First Name, Policy #, Group # and Address

Step – 2

If patient is still unidentifiable after verifying the above data then verify that

there are no claims paid to this patient by the carrier for a different DOS,

from that given

If there is no other claim paid then all payment or denial details of that claim,

to be provided to the carrier to identify the patient

In there is a claim paid for a different DOS then to mention the same to the

carrier

(B) Subscriber‘s policy terminated:

Issue:

Subscriber‘s policy terminated before the date of service.

The claim is not on file

Course of Action:

The patient is billed directly

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 (C) Subscriber‘s policy not effective on the DOS:

Issue:

Subscriber‘s policy not in effect the given DOS

The claim is not on file

Course of Action:

The patient is billed directly

(D) Patient not covered under the Carrier‘s plan:

Issue:

Subscriber‘s policy not covered under the carriers plan

The claim is not on file

Course of Action:

The patient is billed directly

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 6 - NON-COVERED SERVICE

Issue:

The service rendered to the patient is not covered by the patient‘s insurance

plan

Course of Action:

Step –1

To identify whether the charge is billable to the patient or is a provider write-

off, as all claims denied as non-covered services cannot be billed to the patient

To ascertain the cause of the denial as the reason being:

a) That the service is not covered under the patients plan. Then to bill the

patient

Or

b) That the provider cannot bill for that service. Certain procedures are not

billable by some providers. Only specialists can bill for them. Then it is a

provider‘s write-off

Step – 2

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

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 7 - CAPITATION

Issue:

Claim processed towards Capitation

Course of Action:

Step –1

To confirm if the claim has been processed towards Capitation

To check the following:

Claim #

Claim process date

Copy of the EOB

The allowed amount for the claim

Step – 2

To suggest the adjustment of the claim

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 8 – AUTHORIZATION

Issue:

Claim denied stating No Authorization

Case 2: -

Course of Action:

Step –1

To confirm if the claim has been denied, stating no authorization

To check whether authorization is to be obtained by patient or provider

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

Type of plan

Step – 2

To Check if the services rendered require authorization

Step – 3

If provider is responsible for getting the authorization

Check for any claim on file for hospital charges for the same DOS

If yes, to send claim for reprocessing

Step – 4

To call the UM dept for authorization details

If yes, to send claim for reprocessing

If no send a request to the client for getting the authorization details.

If patient is responsible for getting the auth

bill the patient

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 9 – REFERRAL/ REFERRAL NUMBER of PERMISSIBLE VISITS/ REFERRAL
EXPIRED

Issue:

Claim denied stating No Referral

Course of Action:

Step –1

To confirm if the claim has been denied, stating no referral

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Provider participating or non-participating information

PCP contact details

Step – 2

Check for any claim on file for hospital charges for the same DOS

To check with the U&M Department for any referral on file

If no, to check whether any referral for different date

If yes, to send claim for reprocessing

If no, to check whether Back Dating of referral is possible

If yes, to check the back dating referral period

If yes, send a request to the client for referral details with PCP information or

call the PCP‘s office for getting referral details.

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Back Dating of Referrals

To call the PCP‘s office

To speak with the referral coordinator

To check for any referral on file for the corresponding patient and DOS

If yes, then to verify the following details: - Date of Referral, Diagnosis

Code, No of permissible visits, Referring and Rendering Physicians names &

Validity Dates

To send the claim for reprocessing

If no, then request to backdate a referral for the services rendered

If the referral coordinator is to call back to try thrice before billing the

patient on non-receipt of any information from the PCP's office

If the referral coordinator enquiries about the diagnosis codes and / or any

other service details, then to inform that we will call back with the requested

information

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 10 – LACK of PRE-EXISTING INFORMATION

Issue:

Claim pending / denied stating No Pre-Existing information from the patient /

provider

Course of Action:

If Pending:

Step –1

To confirm if the claim has been processed & kept pending, stating no Pre-

Existing information from the patient / provider

To check the following:

Claim #

Claim process date

Copy of the EOB

The type of plan

Whether lack of information from patient / provider

If from Patient:

To check the date of mailing the letter to the patient

To verify whether patient has responded to the mail

If yes, then send the claim for reprocessing

If no, any additional information to be obtained from the

patient, which is necessary for processing the claim, is

to be obtained from the patient

Caller to initiate a call to the patient and request

him/her to provide the required information to the

carrier

To call the carrier after 1 month

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 If from Provider:

To check the name of the provider

If provider different from our client this information will

not be disclosed

To check the date of mailing the letter to the provider

To verify whether the provider has responded to the mail

If yes, then send the claim for reprocessing

If no, any additional information to be obtained from the

provider, which is necessary for processing the claim, is

to be obtained from the provider

Caller to initiate a call to the provider and obtain the

required information

To send the information electronically or thru fax to the

carrier

To call the carrier after 1 month

If Denied: To bill the patient.

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 11– LACK of COB INFORMATION

Issue:

Claim pending / denied stating lack of COB information from the patient /

provider

Course of Action:

If Pending from Patient:

Step –1

To confirm if the claim has been processed & kept pending, stating no COB

information from the patient

To check the following:

Claim #

Claim process date

Copy of the EOB

The type of plan

Step –2

To check the date of mailing the letter to the patient

To verify whether patient has responded to the mail

If yes, then send the claim for reprocessing

If no, any additional information to be obtained from the

patient, which is necessary for processing the claim, is

to be obtained from the patient

Caller to initiate a call to the patient and request

him/her to provide the required information to the

carrier

To call the carrier after 1 month

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If Denied: To bill the patient.

12 – NOT A MEDICAL NECESSITY

Issue:

Claim denied stating not medical necessity

Course of Action:

Step –1

To confirm if the claim has been denied, stating not a medical necessity

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

To check whether the claim will be reviewed on submission of

the LOMN or the medical records

If yes, then check the appeal‗s address or the fax # for claims

submission

If no, it is a provider‘s write-off

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 13 - MAXIMUM BENEFITS EXHAUSTED

Issue:

Claim denied as maximum benefits assigned for the patient exhausted. Maximum

benefits are a predefined amount, which is set as the maximum amount that will

be covered by the carrier

The insured & the carrier in the contract agree upon this amount. Amounts

exceeding the maximum benefit amount will be denied by the carrier

Course of Action:

Step –1

To confirm if the claim exceeds the maximum benefit amount

Step – 2

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

To bill the patient if the maximum benefit amount has been exceeded

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 14 – DIAGNOSIS & PROCEDURE CODES MISMATCH

Issue:

The procedure or treatment does not correspond to the diagnosis. In other

words the procedure codes & the diagnosis codes do not match

Course of Action:

Step –1

To confirm if the diagnosis & procedure codes do not match

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

To check whether the claim will be reviewed on submission after

correction of the codes

If yes, then check the appeal‗s address or the fax # for claims

submission

To send additional medical documentation such as medical records or any

supporting document for the procedure / service rendered

Step – 2

To send the claim for reprocessing after correcting the procedure & diagnosis

codes

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 15 - DEDUCTIBLE

Issue:

The claim processed as paid to deductible. This means that the claim is not

denied, but adjusted against the deductible amount as the patient has not paid

his deductible due for that period of service

Course of Action:

Step –1

To confirm if the claim is processed towards deductible

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step – 2

Deductible is a predefined amount to be paid periodically (monthly, bimonthly,

quarterly, half yearly or annually) apart from the premium by the insured to

the carrier

Services are reimbursed only if this amount is paid for the given period in

which the service is rendered

To ascertain whether the patient has paid the deductible amount due

If deductible is not paid, the carrier will bill the patient for that amount & pay

the same to the provider

If it is out-of network, then to bill the patient for the difference between the

billed amount and the allowed amount

If in network it is a provider‘s write-off

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 16 - DUPLICATION

Issue:

The claim is a duplicate. Two claims claimed for the same date of service, with

the same procedure code, same diagnosis code, same modifier/s and billed for

the same dollar amount for same services rendered by the same physician are

termed as duplicate claims

Course of Action:

Step –1

To confirm if the claim is denied for duplication

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step – 2

For Professional Claims:

To verify the following:

The date of service, the procedure code, the diagnosis code, the provider name

and the modifier (if any)

If any of the above verified details is different from the details of the denied

claim, then the claim is not a duplicate

If claim not duplicate then to send the claim for reprocessing (with modifier 76

for the same provider & 77 for a different provider)

For Hospital Claims:

To check the status of the originally processed claim

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 17 – OUT of POCKET EXPENSES

Issue:

The claim processed as out of pocket expenses

Course of Action:

Step –1

To confirm if the claim is processed towards out of pocket expenses

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Patients annual out of pocket expenses

Total amount including the respective claim for the year in the

DOS

Step – 2

If it is out-of network, then to bill the patient for the difference between the

billed amount and the allowed amount

If in network it is a provider‘s write-off

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 18 – PROVIDER NON-PAR

Issue:

Claim denied stating provider non-par

Course of Action:

Step –1

To confirm that the claim is denied, stating provider non-par

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

If referral or authorization is required. If any of these are

required, proceed with AR issue mentioned in each of these

categories

Step – 2

To check the allowed amount

To bill the patient if the provider is non-par

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 19 – PRIMARY PAID MAXIMUM

Issue:

Claim denied by the secondary insurance stating primary carrier paid maximum

amount

Course of Action:

Step –1

To confirm that the claim is denied, stating primary carrier paid maximum

amount

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step – 2

To check the secondary insurance‗s allowed amount for the services billed

To check the primary insurance‗s allowed amount as mentioned in the primary

EOB

If it is greater, then to bill the patient

If not, to send the claim for reprocessing

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 20 – PRIMARY EOB

Issue:

Claim denied stating that it is a primary EOB

Course of Action:

Step –1

To confirm that the claim is denied, stating it is a primary EOB

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step – 2

Confirm whether the carrier is the secondary insurance to the patient

To check the fax # where we can fax the primary EOB [ if available ] and to

whose attention

Or the claims mailing address

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 21 – WORK RELATED INJURY

Issue:

Claim denied stating that it is a work related injury

Course of Action:

Step –1

To confirm that the claim is denied, stating it is a work related injury by

confirming the diagnosis code

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step –2

If it is an E code then to refile the claim to WC insurance

If not, to bill the patient

Or to send the claim for reprocessing stating it is not a Work related injury

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 22 – RECOUPMENT

Issue:

Claim denied stating that it is a recoupment

Course of Action:

Step –1

To confirm that the claim is denied, stating it is a recoupment

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step –2

To verify the reason for recoupment & the recoupment amount

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 23 - INCLUSIVE

Issue:

Claim denied as inclusive. Inclusive means payment for a procedure is included in

the primary procedure that is being paid

When there are two or more procedures that are performed on the same day in

the same location, and charges submitted for both procedures, the primary

procedure may be paid and the other procedure may be denied stating that the

charges for the second procedure is inclusive in the primary procedure

Course of Action:

Step –1
To confirm if the claim is inclusive

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Determine the most appropriate codes for the 2 nd procedure

Analyze the chances for payment or higher amount by the use of a modifier or

including charges for the 2nd procedure with the 1st

Step – 2

To check the primary procedure code to which the procedure code mentioned in

the claim form has been included

To check whether the claim will be reviewed on submission of LOMN or the

medical records to substantiate that the services are not inclusive

If yes, then to get the appeal‗s address or the fax # for submitting claims

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If no, it will be a provider‘s write off

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 24 - BUNDLED

Issue:

Claim denied as bundled. Bundled means carrier has paid for one of the two

similar procedures done at the same time and payment for the 2 nd procedure is

bundled together with the 1st

When two or more, similar procedures performed on the same day are billed

together, one procedure may be denied as bundled with the 1st i.e., payment of

the second procedure is bundled or paid along with the 1 st procedure

Course of Action:

Step –1

To confirm if the claim is bundled

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Determine whether the procedures are related and a part of each other

Analyze and research for a single CPT code describing all the 3 procedures

Step – 2

To send the claim for reprocessing with the appropriate bundled CPT code,

rather than individual CPT codes

Step – 3 - Unbundling

To unbundle the claims if the procedures are unrelated

Unbundling is the process of proving that 2 procedures done on the same day

and time are unrelated & both procedures are to be paid for separately

Determine whether one of the procedures have a different diagnosis

Appeal the second procedure

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 25 - OFFSET

Issue:

Claim denied as offset

Course of Action:

Step –1

To confirm if the claim is offset

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Reason for offset

Offset date

Offset amount in $

Offset done to which claim – and it‘s detail

DOS

Billed amount in $

Patient‘s name

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 26 - GLOBAL

Issue:

Claim denied as Global. Global means payment for Professional charges are

included with the payment for Hospital charges

When charges for the Provider‘s service are denied stating that it was paid to

the hospital along with the payment for hospital charges, the issue is termed as

Global.

Course of Action:

Step –1

To confirm if the claim is global

To check the following:

Claim #

Claim process date

Claim denial date

Copy of the EOB

The type of plan

Step – 2

Determine whether the professional charges have been paid along with the

hospital charges

If yes, it is a provider write off

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 HIPAA

HIPAA. The American Health Insurance Portability and Accountability Act of

1996 (HIPAA) is a set of rules to be followed by health plans, doctors, hospitals

and other health care providers. HIPAA took effect on April 14, 2003. In the

health care and medical profession, the great challenge that HIPAA has created is

the assurance that all patient account handling, billing, and medical records are

HIPAA compliant.

Patients must be able access their record and correct errors

Patients must be informed of how their personal information will be used.

Patient information can only be shared if needed to treat the patient. In

particular, it cannot be used for marketing purposes without their explicit

consent.

Patients can ask their health plans and providers to take reasonable steps to

ensure that their communications with the patient are confidential. For

instance, a patient can ask to be called on his work number, instead of home or

cell phone number.

Patients can file formal privacy-related complaints to the HHS' Office for Civil

Rights.

Health plans or providers must document their privacy procedures, but they

have a lot of freedom on what to include in their privacy procedure.

Health plans or providers must designate a privacy officer and train their

employees.

Health plans and providers must use standard formats for electronic data

interchange, such as electronic claims submission EDI.

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 Billing Terminologies

1. Term ADJUDICATION

Definition/Description Adjudication is the process of processing claims

for either payment or denial by the claims

department of the insurance company.

2. Term A M A

Definition/Description AMA stands for American Medical Association. It

is an organization of physicians. The AMA is

responsible for determining and revising the CPT +

ICD codes

3. Term APPEAL

Definition/Description It is a Written or Verbal statement made by the

insured to the insurer requesting for reconsidering

the initial determination of a claim

4. Term APPROVED AMOUNT

Definition/Description Approved amount also called as the allowed amount

is the actual amount paid against each billed

amount by the insurance company. This amount is

predetermined by each insurance company and

varies from company to company

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5. Term ASSIGNMENT OF BENEFITS

Definition/Description It is an authorization given by the patient to the

doctor to release confidential patient information

to third parties. The doctors require authorization

for claims processing and payment.

6. Term AUTHORIZATION

Definition/Description It is an authorization given to the doctors to

render a particular service to the patient. It is

given on the basis of the diagnosis for that

treatment / procedure. The Utilization

Management Dept of the carrier gives it.

7. Term BILLING COMPANY

Definition/Description They are the intermediaries between the service

provider and the carrier. They act on behalf of

the provider & submit bills/claims to the carrier.

They also follow up on the claim status till the

carrier settles the claim.

8. Term BILLED AMOUNT

Definition/Description This is the amount charged by the provider for

the services rendered by him. Each and every

treatment / procedure/ service has a standard

billed amount which is determined by AMA.

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9. Term BUDGET

Definition/Description It is a payment option through installments. This

option is used when paying deductibles or any

patient responsibility.

10. Term BUNDLED

Definition/Description Bundled means carrier has paid for one of the two

similar procedures done at the same time and

payment for the 2nd procedure is bundled together

with the 1st. When two or more, similar

procedures performed on the same day are billed

together, one procedure may be denied as bundled

with the 1st i.e., payment of the second procedure

is bundled or paid along with the 1st procedure

11. Term CAPITATION

Definition/Description It is a contract between the insurance company

and the doctor, to pay the doctor based on the

number of patients treated by him or her for a

certain period of time. This is an alternative to

getting paid for each claim.

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12. Term CARRIER

Definition/Description Insurance is a contract that exists between an

organization & a person, to protect the person

from the losses or damage, that he/she might

incur on account of the particular risk or hazard,

which has been stated therein in the contract.

Since the insurance company carriers the financial

risk of the insured, it is also called a carrier.

13. Term CHARGE SHEET

Definition/Description Charge sheet is a bill for the services provided by

the doctor. It contains the following: date of

service, place of service, type of service,

procedure codes, modifiers, diagnosis codes,

patient name, units of service / visits, admission &

discharge dates, time, referring physician and

rendering physician.

14. Term CLAIM

Definition/Description The charge or bill, sent to the carrier for the

services provided by the doctor & other hospital

charges for payment. They are sent as Paper

claims or Electronic Claims.

15. Term CO INSURANCE

Definition/Description It is an agreement whereby the insured agrees to

pay a part of the billed amount for services

received.

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16. Term COVERED SERVICES

Definition/Description Services rendered to patients, which are within

the scope of the policy and are reimbursable by

the carrier.

17. Term CPT CODES

Definition/Description CPT stands for Current Procedural Terminology.

They are a set of codes developed to

define/describe every conceivable medical

treatment or procedure. This coding system is

developed by the AMA & revised annually.

18. Term CREDENTIALING

Definition/Description When a doctor is enlisted within the network of a

carrier, it means that the carrier has credentialed

the doctor. The process is done by means of a W9

form.

19. Term CROSS OVER

Definition/Description When the primary carrier (usually Medicare)

processes a claim and then sends the claim for

processing by the secondary carrier, it is called

cross over.

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20. Term DEDUCTIBLE

Definition/Description A sum of money to be paid periodically (monthly,

bimonthly, quarterly, half yearly or annually) apart

from the premium by the insured to the carrier.

Services are reimbursed only if this amount is paid

for the given period in which the service is

rendered.

21. Term DEMOGRAPHICS

Definition/Description The patient‘s demographics consist of both the

patient & the physician details. The patient details

include name, SSN, address, date of birth,

gender, ID no., consent/waiver form, guarantor

details, insurance details, insurance card copy,

employer info, patient subscriber relation, policy

effective & expiry dates. Physician details include

Rendering & Referring physician details, referral

form & authorization details.

22. Term DOS (DATE OF SERVICE)

Definition/Description The date on which the service was rendered to

the patient.

23. Term DIAGNOSIS

Definition/Description It is the process of identifying the cause for an

illness/injury/condition by assessing the patient‘s

symptoms, past medical history, other medical

tests and counseling.

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24. Term DURABLE MEDICAL EQUIPMENT

Definition/Description Purchased or rented items such as hospital beds,

iron lungs, oxygen equipment, seat lift equipment,

wheelchairs, and other necessary medical

equipment prescribed by a health care provider to

be used in a patient's home and are covered by

Medicare.

25. Term EGHP

Definition/Description Employer Group Health Program - is a health

insurance sponsored by the employer of either the

patient or his/her spouse.

26. Term EXCLUSIONS

Definition/Description Provisions in the law stating situations or

conditions which are not covered by the insurance

contract/policy.

27. Term ELIGIBILITY

Definition/Description Eligibility refers to whether a patient is covered

for health care by the carrier. The policy gives a

clear picture of the eligibility of the person.

28. Term EOB

Definition/Description EOB, which stands for Explanation of benefits, is

a form, which states the initial determination of a

claim (payment/denial) and the reasons for it, as

processed by the carrier. It is usually sent to the

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 billing office.

29. Term FEE SCHEDULE

Definition/Description It is a lift of services and their respective

payable amounts. The payable amount indicates

the maximum allowed payment for that particular

service. The fee schedule is fixed for each carrier

and may vary from carrier to carrier.

30. Term FEE FOR SERVICE

Definition/Description It is a fee charged to the patient for each &

every service rendered by the doctor.

31. Term GLOBAL FEE

Definition/Description The technical & professional charges of a claim

combined together is called Global Fee.

32. Term HCFA

Definition/Description HCFA stands for Health Care Financial

Administration. It is a part of the dept of Human

services that operate the Medicare Program. It is

now known as CMS - Center for Medicare and

Medicaid Studies. All professional charges are

sent in the form of a HCFA form to Medicare.

33. Term HOSPITAL BASED PHYSICIAN

Definition/Description A physician who has a contract with the hospital

to provide healthcare services in the hospital.

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34. Term IN-PATIENT

Definition/Description A patient who stays and uses the hospitals regular

/ intensive/ institutional facilities & is admitted in

the hospital or health facility is called an

In-patient.

35. Term INCLUSIVE

Definition/Description Inclusive means payment for a procedure is

included in the primary procedure that is being

paid. When there are two or more procedures that

are performed on the same day in the same

location, and charges are submitted for both

procedures, sometimes the primary procedure will

be paid and the other procedure is denied stating

that the second procedure is inclusive with the

primary procedure.

36. Term LINE ITEM

Definition/Description It is an item or service specifically detailed in the

claim.

37. Term MEDICAL REVIEW

Definition/Description It is a check done to ensure the relevance and

authenticity of all procedures/treatment rendered.

Medical review ensures that all services rendered

are within the scope of the policy, thus ensuring a

clean claim & payment.

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38. Term MEDICAL NECESSITY

Definition/Description Services which are necessary & consistent with

a) The diagnosis and treatment of the insured‘s

condition, disease, ailment or injury.

b) The standards of good medical practice, which

are not provided for the convenience of the

insured, the hospital or the physician.

C) The most appropriate level of service that can

be safely provided for that diagnosis or

treatment.

39. Term MEDICARE SECONDARY PAYER (MSP)

Definition/Description A term used to identify Medicare as the

Secondary Payer for a health insurance claim.

Medicare is identified as Secondary Payer when

the insured has medical insurance coverage other

than Medicare, which is considered Primary.

40. Term MEDICARE SUMMARY NOTICE

Definition/Description A form sent by Medicare to the billing office,

(provider), detailing how a particular claim has

been processed.

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41. Term MODIFIER

Definition/Description Modifiers are standard 2 digit alpha or numeric

codes, used in conjunction with a CPT or HCPCS

codes to alter the original definition / description

of that code. Thus modifiers give a new or

different meaning to the code. Using modifiers

either results in the increase / decrease of the

reimbursement amount.

42. Term NATIONAL PROVIDER IDENTIFIER

Definition/Description It is a unique individual identification number

assigned to providers. It is also known as Unique

Provider Identification Number (UPIN).

43. Term NON-PARTICIPATING PROVIDER

Definition/Description Providers or Suppliers (of health care) who do not

participate in insurance programs and are not

listed in the network of an insurance company.

They are also called as out of network providers.

44. Term NON-RENDERED SERVICES

Definition/Description Services or supplies that are claimed by the

provider or supplier without the same being

actually provided to the patient.

45. Term OVER PAYMENT

Definition/Description A payment by the carrier, which is greater than

the allowed amount for that particular billed

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 amount, is referred to as overpayment.

46. Term OUT OF POCKET

Definition/Description They are expenses that are the responsibility of

the insured and are not reimbursable by the

carrier. These are expenses that are not covered

by Medicare or any other insurance.

47. Term PARTICIPATING PROVIDER

Definition/Description Providers or Suppliers (of health care) who agree

to participate in insurance programs and are listed

in the network of an insurance company. They are

also called as in network providers. Participatory

providers have certain benefits such as, higher

allowances, toll free telephone lines for electronic

submission of claims, no legal charge limit, medigap

benefits and free publicity.

48. Term PROVIDER / PHYSICIAN / DOCTOR

Definition/Description A generic term for any person or entity approved

of providing health care to beneficiaries (health

insured patients) and is eligible to receive payment

for such services rend, from the carrier. Providers

are also referred to as Physicians or Doctors.

49. Term REFERRAL

Definition/Description Referral is a reference from the PCP to consult a

specialist for treatment of an ailment / injury

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 which cannot be attended to by the PCP & needs

specialized treatment. Usually the PCP refers a

specialist in network.

50. Term RENDERING PHYSICIAN

Definition/Description A physician who treats the patient is called as the

rendering physician.

51. Term REFERRING PHYSICIAN

Definition/Description A physician who refers a patient to a specialist or

another physician is called as a referring

physician. The PCP gives referrals and usually

refers a specialist in network.

52. Term REVIEW

Definition/Description The first formal level of appeal, following a denial

of a claim is termed as review. Review is a request

to the carrier to reconsider a previously

determined claim.

53. Term SSN – SOCIAL SECURITY NUMBER

Definition/Description This is a 9-digit number issued in USA, which is a

multipurpose identification number. The 9 digits

SSN. is divided into 3 parts: The first 3 digits are

area numbers. The middle 2 digits are the group

numbers. They have no special geographic or data

significance but merely serve to break the no. into

conveniently sized blocks for orderly issuance. The

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last four digits are serial numbers. They represent

a straight numeric sequence of digits from 0001 to

9999 within the group. Example: 123-45-6789.

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54. Term SUPER BILL

Definition/Description A super bill is like a charge sheet but also

contains the insurance information apart from the

patient & provider information. A super bill

contains the following information in addition to

the charge sheet information: charge amount,

coverage information, co-pay and patient

demographic details.

55. Term UNBUNDLING

Definition/Description Unbundling is the process of proving that 2

procedures done on the same day and time are

unrelated & both procedures are to be paid for

separately.

56. Term UP CODING

Definition/Description Up coding is a potentially fraudulent activity of

submitting false claims to the carrier. False claims

are claims submitted for non-covered or non-

chargeable services, supplies or equipment. In up

coding such claims are sent as charges rendered

by a specialist in network.

57. Term W9 FORM

Definition/Description A form which is used by the carrier for provider

enrollment in a network.

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58. Term WRITE OFF

Definition/Description The difference between the billed and allowed

amount is called as provider write off.

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