BILLING, REIMBURSEMENT, AND COLLECTIONS Chapter 9

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  • BILLING, REIMBURSEMENT, AND COLLECTIONSChapter 9

    Chapter 9

  • Billing, Reimbursement,and CollectionsLearning ObjectivesCompute charges for medical services and create patient statements based on the patient encounter form and the physician's fee schedule.Explain the process of completing and transmitting insurance claims.Discuss the advantages of using electronic claims.Describe the different types of billing options used by medical practices for billing patients.Discuss the procedures and options available for collecting delinquent accounts.

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  • Key TermsClearinghouseCMS-1500 claim form Collection agencyCollection at the time of serviceCycle billingDependentElectronic claimsEOBERA

    Fee adjustment Fee scheduleGuarantorMonthly billingPatient information formPatient statementTerminated accountThird-party liabilityWrite-off

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  • Patient Encounter FormFacilitates billing process Used to record details of each patient encounter for billing and insuranceIncludes Patient informationDateDiagnosis for current visitProcedure informationFinancial information

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  • Patient Encounter Form (contd)Usually preprinted with common diagnoses/proceduresNew form attached to medical record for each visitPhysician fills in form as visit/procedures progressForm is returned to administrative medical assistant for use in billing

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  • Fee ScheduleLists the usual procedures performed in the office and corresponding chargesThere may be more than one fee schedule, depending on insurance plan participationAdministrative medical assistant must be familiar with office policy regarding financial arrangements for payment

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  • Patient StatementsAll transaction data stored in patient ledgerStatement showsServices renderedChargesPayments madeBalance owedStatement is sent to patient or guarantor

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  • Computerized BillingUsed to print patient statements and blank patient encounter forms Also used to produce reports such asDay sheetsMonthly reportsAging reportsDepartmental incomePhysician incomeProcedure code usage

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  • Insurance ClaimsMost practices complete the insurance form for the patientForm captures both clinical and financial informationTransmitted to patients insurance carrierPartial or full reimbursement

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  • The CMS-1500 Claim FormMost common paper claim formPrepared by medical insurance specialistData is collected fromPatient information formPatient encounter formTransmitted via mail

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  • The HIPAA Claim FormStandard format for electronic claimsAccepted by government and private carriersPrepared on computer by medical insurance specialistTransmitted via a modem to insurance companyFaster and easier to track

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  • Third-Party PayersInsurance carriersReview claim for accuracy and completenessEvaluate treatment receivedDecide what benefits are due to the insuredCarrier mayPay the claimDeny the claimPay less than the full amount

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  • ERA/EOBERA is electronicEOB is paperExplains reimbursement decisionAmount of benefitBenefits paid toPaid on behalf ofHow determinedMay include check or record of EFT

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  • ERA/EOB (contd)Administrative medical assistant checks report against original claimFiles with patients financial recordsUpdates patients ledgerDeposits check or records EFT

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  • Patient BillingAfter insurance claim process has been completedPatient may be billed for amounts not fully reimbursed by the carrierAdministrative medical assistant acts as go-between for carrier and patient

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  • Completing the Claim FormVerify insurance informationUse phone, fax, or Web to verify coverageAccuracy of dataContract numbersPatients identification informationInsureds informationSecondary carriers, if anyIllness or injury related to work or accidentDiagnosis codesProcedure codes and chargesProvider information

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  • Using Computers to Create ClaimsComputerized billing and claimsMost practices use software programs, such as NDCMediSoft, to store information about patients and insurance plansClaims created by billing programs may be printed or submitted electronicallyThe stored information is called a database

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  • Electronic vs. Paper ClaimsElectronic claimsTransmitted via modemReceive immediate feedback Faster reimbursementGreater accuracyLess expensivePaper claimsSent through mailMust be keyed or scanned by insurance company into its computer systemPossibility of errors

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  • ClearinghousesService bureauActs as an intermediary between provider and payerReformats data from provider to a form accepted by the payer

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  • Follow-upERA/EOB checkedProcedures listed on ERA/EOB match claimUnpaid charges explainedCodes on ERA/EOB match claimPayment listed for each procedure is correct

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  • Follow-up (contd)TracerContains basic billing information and asks carrier about statusPaper or electronicSome providers automatically rebill after 30 days

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  • Follow-up (contd)Denied or late claimsUnclear denial or incorrect payment should be followed up to determine causeCarrier asks for more information to process claimClaims investigated for preexisting conditions

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  • Follow-up (contd)Provider resubmits claims on ownMistake in billingClaim overlookedInsurance carrier asks for resubmissionIncorrect codes have been submittedInformation is incomplete or missingCharges do not total properlyAppeal process

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  • Patient PaymentsCash flowPayment methodsCollection at the time of serviceMonthly billingFixed weekly or monthly paymentsBill health insurance carriersCash-only basis

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  • Cash PaymentsEach payment is entered inPatients ledgerDaily recordPayments given to assistant, not physicianReceipt must be givenSafeguard moneyEndorse checks for deposit onlyDaily bank deposits

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  • Patient StatementsMonthly billingBills sent once a monthTimed near end of month to coincide with patients other billsCycle billingAvoids once-a-month billing workloadStabilizes cash flowAccounts divided into equal groups Each group billed on a different date

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  • Payment Plansand AdjustmentsPayment plansPatients unable to pay bill in one lump sumAgreement in writingFee adjustmentWrite-offsPAR provider not permitted to bill for difference between amount charged and amount reimbursedPhysician may choose to reduce or cancel a billWritten evidence; dont delete transactions

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  • Health InsuranceProvides payment for a portion of medical expensesParticipating (PAR) providers usually file claims for patientsPatients responsible for copaymentsNon-participating (nonPAR) providers expect payment at time of serviceReceipt given to patient for paymentPatient may file claim

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  • Third-Party LiabilityPerson other than patient is responsible for charges Assistant must obtain verification from third partyMust be in writing; can not be oralGuarantorPerson who is the policyholder for the patientDependent children

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  • CollectionsEffective communication with patients is first step in collections processNotify patient in advance of probable costs not covered by insurance plansHave patient agree in writing to pay for noncovered servicesAdvance Notice for Noncovered ServicesMake payment arrangements before services are performed

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  • Collections (contd)Collection ratioAt least 1/3 of the outstanding accounts should be collected each dayAging accountsStatus: 30, 60, or 90 days past dueLaws regulating collectionsFair Debt Collection Practices Act of 1977Telephone Consumer Protection Act of 1991

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  • Collections (contd)Collection methodsOffice policies Federal laws and state lawsTelephoneLetterTerminated accountsPhysician may terminate the relationship due to lack of paymentCollection agencies

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  • Collections (contd)Statute of LimitationsSet by each stateTruth in Lending Act of 1960For payment plans over 4 payments in length, with finance chargesRegulation Z requires a disclosure form to be completed and signed by practice manager and patient

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  • Collections (contd)Uncollectable accountsAll collection attempts have been exhaustedWould cost more to continue collection attempts than the amount dueWritten off as bad debt

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  • QuizFalse, collections are begun after the bill is more than 30 days overdue. False, the insurance carrier uses ERA/EOB to inform the patient/provider of the status of claims.The ERA/EOB is submitted to the insurance carrier as part of the claim. (T/F)An appeal is a formal method of asking for reconsideration of a denied claim. (T/F)Collections are made on current bills. (T/F)True, the appeal is done in writing.

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  • Critical ThinkingList some advantages of electronic claims.Advantages of electronic claims: lower costs, reduced rejection, greater accuracy, faster payment, access to status reports.

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