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INSUR {CBCS-CPC}
Payments (RAs), Appeals, and Secondary Claims
| Term | Definition |
|---|---|
| aging | Classification of AR by the length of time an account is due. |
| appeal | A request sent to a payer for reconsideration of a claim adjudication. |
| appellant | One who appeals a claim decision. |
| autoposting | Software feature that enables automatic entry of payments on a remittance advice to credit an individual’s account. |
| claim adjustment group code (CAGC) | Code used by a payer on an RA to indicate the general type of reason code for an adjustment. |
| claim adjustment reason code (CARC) | Code used by a payer on an RA to explain why a payment does not match the amount billed. |
| claimant | Person or entity exercising the right to receive benefits. |
| claim status category codes | Codes used by payers on a HIPAA 277 to report the status group for a claim, such as received or pending. |
| claim status codes | Codes used by payers on a HIPAA 277 to provide a detailed answer to a claim status inquiry. |
| claim turnaround time | The time period in which a health plan is obligated to process a claim. |
| concurrent care | Medical situation in which a patient receives extensive, independent care from two or more providers on the same date of service. |
| determination | A payer’s decision about the benefits due for a claim. |
| development | Payer process of gathering information in order to adjudicate a claim. (more info is needed for processing) |
| electronic funds transfer (EFT) | Electronic routing of funds between banks. |
| explanation of benefits (EOB) | Document sent by a payer to a patient that shows how the amount of a benefit was determined. |
| grievance | Complaint by a medical practice against a payer filed with the state insurance commission by a practice. |
| HIPAA X12 835 Health Care Payment and Remittance Advice (HIPAA 835) | The HIPAA-MANDATED electronic transaction for payment explanation. |
| HIPAA X12 276/277 Health Care Claim Status Inquiry/Response (HIPAA 276/277) | The standard electronic transaction to obtain information on the status of a claim. |
| insurance aging report | A report grouping unpaid claims transmitted to payers by the length of time that they remain due, such as 30, 60, 90, or 120 days. |
| medical necessity denial | Refusal by a health plan to pay for a reported procedure that does not meet its medical necessity criteria. |
| Medicare Outpatient Adjudication (MOA) remark codes | Remittance advice codes that explain Medicare payment decisions. |
| Medicare Redetermination Notice (MRN) | Communication of the resolution of a first appeal for Medicare fee-for-service claims; a written decision notification letter is due within sixty days of the appeal. |
| Medicare Secondary Payer (MSP) | Federal law requiring private payers who provide general health insurance to Medicare beneficiaries to be the primary payers for beneficiaries’ claims. |
| overpayment | An improper or excessive payment resulting from billing errors to a provider as a result of billing or claims processing errors for which a refund is owed by the provider. |
| pending | Claim status during adjudication when the payer is waiting for information from the submitter. |
| prompt-pay laws | Regulations that obligate payers to pay clean claims within a certain time period. |
| reassociation trace number (TRN) | Identifier that is passed from the payer to the payer’s bank, then to the practice’s bank, and finally to the practice. |
| reconcilliation | Comparison of two numbers to determine whether they differ. |
| redetermination | First level of Medicare appeal processing. |
| remittance advice (RA) | Health plan document describing a payment resulting from a claim adjudication; the copy sent to the insured is called an explanation of benefits (EOB). |
| remittance advice remark code (RARC) | Code that explains payers’ payment decisions. |
| suspended | Claim status during adjudication when the payer is developing the claim. |
| adjudication | The process followed by health plans to examine claims and determine benefits. |
| claim adjudication steps | 1. initial processing 2. automated review 3. manual review 4. determination 5. payment |
| practice management programs (PMPs) | create a tamper-proof record of the filing date of every claim that can be used to prove timely filing |
| clean electronic claims are paid within | 14 days |
| Medicare must process "other-than-clean" claims within | 45 calendar days of receipt |
| where suspended claims are sent for development | medical review department |
| personnel that works within the medical review department | claims examiner |
| three determination factors | 1. pay it 2. deny it 3. pay it at a reduced level |
| service falls within normal guidelines | service will be paid |
| service is not reimbursable | the item on the claim is denied |
| service was at too high a level for the diagnosis | a lower-level code is assigned |
| level of service is reduced | examiner has downcoded the service |
| medical necessity denial | may result from a lack of clear, correct linkage between the diagnosis and procedure |
| medical necessity denial | when a higher level of service was provided without trying a lower, less invasive procedure |
| ERA | electronic remittance advice |
| electronic remittance advice (ERA) | a transaction that explains the payment decisions to the provider |
| explanation of benefits (EOB) | an older term that now refers to the document a beneficiary receives |
| explanation of benefits (EOB) | typically paper documents that are mailed, but electronic transmission via e-mail is increasing |
| monitoring claims during adjudication requires | two types of information |
| two types of info required during monitoring claims adjudication | 1. The amount of time the payer is allowed to take to respond to the claim 2. How long the claim has been in process |
| ERISA plans | must follow federal prompt-pay rules |
| aging | how long a payer has had the claim |
| is used to generate an insurance aging report | practice management programs (PMPs) |
| HIPAA X12 276/277 Health Care Claim Status Inquiry/Response (HIPAA 276/277) | the standard electronic transaction to obtain information on the current status of a claim during the adjudication process |
| examines the insurance aging report and selects claims for follow-up | medical insurance specialist |
| HIPAA 276 | the inquiry of the claim |
| HIPAA 277 | the response returned by the payer |
| uses claim status category codes | HIPAA 277 |
| pending | the payer is waiting for information before making a payment decision |
| E/M service | evaluation and management service |
| websites of states' insurance commissions or departments | where one can find: prompt-pay laws, where claims are being sent to determine the payment time frames, and the penalty for late payers |
| remittance advice (RA) | AKA: explanation of benefits, explanation of payments |
| remittance advice (RA) | summarizes the results of the payer's adjudication process |
| remittance advice (RA) | covers a group of claims, not just a single claim |
| claims paid on a SINGLE remittance advice (RA) | are not consecutive or logically grouped; they are usually for different patients' claims and various dates of service |
| remittance advice (RA) | list claims that have been adjudicated within the payment cycle alphanumerically by the patient account number, alphabetically by client name, or numerically by internal control number |
| corresponding EOB | lists just the information for the recipient |
| remittance advice (RA) | have FOUR types of information, often located in separate sections |
| FOUR remittance advice (RA) information sections | header information, claim information, totals, and a glossary |
| remittance advice (RA) HEADER INFO SECTION 1: | contains: payer name and address; provider name, address, and NPI (national provider identifier); date of issue; EFT transaction number; and "bulletin board" of notes to the provider |
| remittance advice (RA) CLAIM INFO SECTION 2: | contains: the patient's name, plan ID number, account number, and claim control number (CIN) and whether the provider accepts assignment (using Y or N) |
| PERF PROV | performing provider |
| SERV DATE | dates of service |
| POS | place of service code |
| NOS | number of services rendered |
| PROC | current procedural terminology (CPT)/Healthcare Common Procedure Coding System (HCPCS) procedure code |
| MODS | Modifiers for the procedure code |
| BILLED | Amount provider billed for the service |
| ALLOWED | Amount payer allows |
| DEDUCT | Any deductible the beneficiary must pay to the provider |
| COINS | Any coinsurance the beneficiary must pay to the provider |
| GRP/RC | Group and reason adjustment codes |
| AMT | Amount of adjustments due to group and reason codes |
| PROV PD | Total amount provider is paid for the service |
| PT RESP | Total amount that the beneficiary owes the provider for the claim |
| CLAIM TOTALS | Total amount for each of these columns: BILLED, ALLOWED, DEDUCT, COINS, AMT, and PROV PD |
| NET | Amount provider is paid for all the services for the claim |
| remittance advice (RA) TOTALS SECTION 3: | shows the totals for all the claims on the RA |
| CHECK AMT field | contains the amount of the check or EFT payment that the provider receives |
| remittance advice (RA) GLOSSARY SECTION 4: | lists the adjustment codes shown on the transaction with their meanings |
| adjustment on the remittance advice (RA) | the payer is paying a claim or a service line differently than billed |
| remittance advice (RA) | whether sent electronically or in a paper format, the basic information in the transaction is the same, although the appearance of the document is often different |
| RA adjustments determination codes | 1. claim adjustment group code 2. claim adjustment reason code 3. RA remark code |
| PR - Patient Responsibility | appears next to an amount that can be billed to the patient or insured |
| CO - Contractual Obligations | appears when a contract between the payer and the provider resulted in an adjustment |
| CO - Contractual Obligations | this group code usually applies to allowed amounts |
| CO - Contractual Obligations | are not billable to patients under the contract |
| CR - Corrections and Reversals | appears to correct a previous claim |
| OA - Other Adjustments | used only when neither PR nor CO applies as when another insurance is primary |
| PI - Payer Initiated Reduction | appears when the payer thinks the patient is not responsible for the charge but there is no contract between the payer and the provider that states this |
| PR - Patient Responsibility | this group code typically applies to deductible and coinsurance/copayment adjustments |
| PI - Payer Initiated Reduction | may be used for medical review denials |
| CARC | claim adjustment reason codes |
| RARC | remittance advice remark codes |
| MOA | Medicare outpatient adjudication (remark codes) |
| RA adjustment claim line items | denied | zero pay | reduced amount paid | less because a penalty is subtracted from the payment |
| RA unique claim control number | the resource needed to match the payment to a claim |
| The PMP | where each claim is located to process the RA - either manually or automatically by the computer system |
| EFT | electronic funds transfer |
| TRN | reassociation trace number |
| ACA (Affordable Care Act) | mandates that federal payments to providers be sent only by electronic means |
| The PMP | where payment and adjustment transactions are entered |
| Payment and Adjustment transaction Data Entry | date of deposit | payer name and type | check or EFT number | total payment amount | amount to be applied/type of payment |
| autoposting | software that allows user to establish posting rules so the med insurance specialist can examine claims that are not paid as expected |
| reconciliation | makes sure the totals on the RA check out mathematically. |
| reconciliation | the total amount billed minus the adjustments should equal the total amount paid |
| Typical Denial Management problems and solutions | rejected claims | procedures not paid | partially paid, denied, or downcoded claims |
| rejected claims | a claim that is not paid due to incorrect information must be corrected and sent to the payer according to its procedures |
| procedures not paid | if a procedure that should have been paid on a claim was overlooked, another claim is sent for that procedure |
| PARTIALLY PAID, denied, or downcoded claims | if the payer has denied payment: study the adjustment codes to determine why |
| partially paid, DENIED, or downcoded claims | if a procedure is not a covered benefit or if the patient was not eligible: bill the patient for the noncovered amount |
| partially paid, denied, or DOWNCODED claims | if the claim is denied or downcoded: options are to bill the patient, write off the amount as a contractual adjustment, or challenge the determination with an appeal |
| denial code categories | coding errors | registration mistakes | billing errors | payer requests for more information or general delays in claims processing |
| State Insurance Commissioner | where a practice may elect to file a complaint |
| appeal | a process that can be used to challenge a payer's decision to deny, reduce, or otherwise downcode a claim |
| The ACA | under this act, payers are required to process appeals |
| Independent Review Organization | if payment is denied, patients can utilize this organization to decide the case |
| Escalating structure of appeals | 1. complaint 2. an appeal 3. a grievance |
| Three Levels | number of levels a claimant must move through in pursuit of an appeal |
| Documentation required after appeal rejection | copies of the complete case file : all documents that relate to the initial claim determination and the appeal process, along with a letter of explanation |
| MRN | Medicare Redetermination Notice |
| Medicare Appeals this process involves five steps: | Redetermination, Reconsideration, Administrative law judge, Medicare Appeals Council, Federal Court (judicial) review |
| redetermination (Medicare appeal 1st step) | reviewed by a Medicare employee carrier not involved with initial claim determination |
| redetermination (Medicare appeal 1st step) | must be made within 120 days of receiving the initial claim |
| redetermination (Medicare appeal 1st step) | made by completing a form or letter with attached supportive medical documentation |
| redetermination (Medicare appeal 1st step) | if decision is favorable, payment is sent. if redetermination is either partially favorable or unfavorable, MRN is mailed |
| redetermination (Medicare appeal 1st step) | the decision must be made within 60 days, and the MRN is sent to both the provider and the patient |
| reconsideration (Medicare appeal 2nd step) | request must be made within 180 days of receiving the redetermination notice. at this level, the claim is reviewed by qualified independent contractors (QICs) |
| QICs | qualified independent contractors |
| administrative law judge (Medicare appeal 3rd step) | there is a hearing by an administrative law judge. hearing must be requested within 60 days of receiving the reconsideration notice |
| Medicare Appeals Council (Medicare appeal 4th step) | must be requested within 60 days of receiving the response from the hearing by the administrative law judge |
| Calendar days | timelines for each appeal level (including weekends) not work days |
| Beneficiary itemized statement request | provider must comply within 30 days or be fined 100.00 per outstanding request |
| overpayments | AKA: credit balances |
| postpayment audits (reviews) | used to build clinical information, and to study treatments and outcomes for patients with similar diagnoses |
| postpayment audits (reviews) | patterns that are determined are used to confirm or alter best practice guidelines |
| postpayment audits (reviews) | verify the medical necessity of reported services or to uncover fraud and abuse |
| postpayment audits (reviews) | conducted to check the documentation of the provider's cases, or to check for fraudulent practices |
| overpayment example | payer may mistakenly overpay a claim, or pay it twice |
| overpayment example | PP audit shows a claim that has been paid should be denied or downcoded because the documentation does not support it |
| overpayment example | provider may collect a primary payment from Medicare when another payer is primary |
| FERA of 2009 | The Fraud Enforcement and Recovery Act of 2009 |
| FERA of 2009 | made major changes to the False Claims Act (FCA) by defining the act of keeping an overpayment from fed govt as fraud |
| FCA | False Claims Act |
| FERA of 2009 | encourages qui tam lawsuits |
| FERA of 2009 | extends the whistle-blower protection to cover both contractors and agents of an entity in addition to employees |
| FERA of 2009 | expanded the ACA by defining reverse false claims |
| The ACA | classifies overpayments as an obligation under the FCA |
| grievance | medical practices file these with the State Insurance Commission |
| COB | coordination of benefits |
| CMS-1500 | if a paper RA claim is received, use this to bill the secondary health plan that covers the beneficiary (attach w/ primary RA) |
| COBC | coordination of benefits contractor (MEDICARE) |
| Electronic claims to the SECONDARY payer | sent electronically or on paper, according to the payer's procedures |
| PRIMARY claim | generally crosses over automatically to the secondary payer and no other additional claim is filed |
| Noncrossover Claims | the medical insurance specialist prepares an additional claim for the secondary payer and sends it with a copy of the RA |
| MSP | Medicare Secondary Payer |
| Medicare Secondary Payer (MSP) program | benefits for a patient who has both Medicare and other coverage are coordinated under this program |
| HIPAA 837P | if Medicare is the SECONDARY payer to the primary payer, the claim must be submitted with this |
| HIPAA 837P | must report the amount the primary payer paid for the claim or for a particular service line in the ALLOW AMT field. |
| CMS-1500 | claims for which more than one plan is responsible for payment prior to Medicare, should be submitted using this |
| The "OTHER payers' RA" | must be attached when the claim is sent to Medicare for processing |
| Medicare is the SECONDARY payer | when an individual is employed and is covered by the employer's group health plan |
| Medicare is the SECONDARY payer | employees who are on leaves of absence, receiving short-term or long-term disability benefits |
| Medicare is the SECONDARY payer | when an individual is over age SIXTY-FIVE is covered by a spouse's employer's group health plan (even if spouse is >65yo) |
| Medicare is the PRIMARY payer | an individual who is working for an employer with 20 employees or fewer |
| Medicare is the PRIMARY payer | an individual who is covered by another policy that is not a group policy |
| Medicare is the PRIMARY payer | an individual who is enrolled in Part B but not Part A of the Medicare program |
| Medicare is the PRIMARY payer | an individual who must pay premiums to receive Part A coverage |
| Medicare is the PRIMARY payer | an individual who is retired and receiving coverage under a previous employer's group policy |
| Medicare is the SECONDARY payer | if an individual under age 65 is disabled and is covered by an employer group health plan |
| Medicare is the PRIMARY payer | if the individual or family member is not actively employed |
| Medicare is the PRIMARY payer | An individual and family members who are retired and receiving coverage under a group policy from a previous employer |
| Medicare is the PRIMARY payer | An individual and family members who are working for an employer with a hundred or fewer employees |
| Medicare is the PRIMARY payer | An individual and family members receiving coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 |
| Medicare is the PRIMARY payer | An individual who is covered by another policy that is not a group policy |
| Medicare is the SECONDARY payer | individuals who are covered by employer-sponsored group health plans and who fail to apply for ESRD-based Medicare coverage. |
| Medicare is the SECONDARY payer | an individual receives treatment for a job-related injury or illness (workers' compensation) |
| Medicare is the SECONDARY payer | an individual suffers from a lung disorder caused by working in a mine |
| Medicare is the SECONDARY payer | when treatment for an accident-related claim whether automobile, no-fault, or liability |
| Veteran's choice | if a veteran is entitled to Medicare benefits, he or she may choose coverage through Medicare or the Dept of Veterans Affairs |
| THREE formulas | these are used to calculate how much of the patient's coinsurance will be paid by Medicare under MSP |
| Medicare as the SECONDARY payer | pays 100 percent of most coinsurance payments if the patient's Part B deductible has been paid |
| Medicare | of the "three formulas" this PROVIDER will pay the LOWEST |
| THE THREE FORMULAS (1 of 3) | primary payer's allowed charge - payment made on claim |
| THE THREE FORMULAS (2 of 3) | what Medicare would pay (80 percent of Medicare allowed charge) |
| THE THREE FORMULAS (3 of 3) | higher allowed charge (either primary payer or Medicare) - payment made on the claim |
| THE THREE FORMULAS (equation example) | (1) $100-$80 = $20 (2) $80 x 80% = 64 (3) $100-$80 = $20 [Medicare will pay $20 because this is the lowest of the 3] |
| when another plan is PRIMARY | Medicare pays up to the higher of two allowable amounts |
| no ADDITIONAL payment is made | if the PRIMARY payer has already paid more than the Medicare allowed amount |
| for ELECTRONIC claims | the specialist reports a TWO-DIGIT insurance type code under the MSP program. (NOT required on the CMS-1500 claims) |
| TRICARE is the SECONDARY payer | six item numbers on a paper claim are filled in differently than when TRICARE is the PRIMARY payer |
| Medicare is the PRIMARY payer | if a patient/beneficiary has Medi-Medi coverage (the claim is automatically crossed over to Medicaid for secondary payment) |
| Only appears on SECONDARY claims | PRIMARY payer payments |
| Federal Court (judicial) review | the hearing must be requesting within 60 days of receiving the department appeals board decision |
Created by:
VA_MedCod3r