Chapter 17: Insurance and Billing

Services that would be covered under Medicare Part B: (6)

- Licensed and credentialed provider services - Outpatient hospital services - Diagnostic tests - Clinical laboratory services - Outpatient physical and speech therapy (as long as these services are considered medically necessary) - Home health supplies

When a patient brings you a superbill at the end of a visit, which of the following procedures might you perform, depending on practice policy? - Enter an adjustment to the patient's account for noncovered services. - Accept an insurance copayment or coinsurance from the patient and credit the account. - Prepare and transmit a healthcare claim on behalf of the patient to the insurance company. - Have the patient sign an ABN for any procedures that will not be covered by Medicare.

- Accept an insurance copayment or coinsurance from the patient and credit the account. - Prepare and transmit a healthcare claim on behalf of the patient to the insurance company.

What are 3 security measures that should be used to protect identifiable health information transmitted electronically? - Access control, passwords, and log files to keep intruders out - Security policies to handle violations that occur - Backup files with the physician or office manager at all times - Backups to replace items after damage to a computer

- Access control, passwords, and log files to keep intruders out - Security policies to handle violations that occur - Backups to replace items after damage to a computer

Medical offices use security measures to protect which aspects of individually identifiable health information? - Inconvenience - Instability - Availability - Integrity - Confidentiality

- Availability - Integrity - Confidentiality

Which of the following payments may be covered by a patient's secondary insurance plan? - Copayments - Deductibles - Coinsurance - Allowed charges - Premiums

- Copayments - Deductibles - Coinsurance -- The primary plan is the policy that pays benefits first. The secondary, or supplemental, plan pays the deductible and coinsurance or copayment.

Which of the following pieces of personal information must you verify with a patient when you are completing an insurance claim? - Emergency contact information - Current home telephone number - Current home address - Current employer email

- Emergency contact information - Current home telephone number - Current home address

Which of the following tasks can be performed with a medical billing program? - Filing insurance claims and billing patients - Recording patient vital signs - Recording the procedures and services performed - Reviewing and recording payments - Documenting follow-up and treatment plans

- Filing insurance claims and billing patients - Recording the procedures and services performed - Reviewing and recording payments

Which of the following is insurance information you will need to obtain in order to file an insurance claim? - Insurance carrier - Current home address - Group plan number - Insurance identification number

- Insurance carrier - Group plan number - Insurance identification number

Which of the following pieces of personal information should be obtained and verified with patients when they first arrive at the office? - Current employer - Legal name - Social Security number - Credit record - Date of birth

- Legal name - Social Security number - Date of birth

What common errors can prevent clean claims? - Complete identifier of the referring provider - Missing or invalid subscriber or patient information - Missing or incomplete service provider name - Medicare assignment indicator or benefits assignment indicator - Missing payer name and/or payer identifier

- Missing or invalid subscriber or patient information - Missing or incomplete service provider name - Missing payer name and/or payer identifier

What are the most common ways that prior authorization can be performed? - From the patient - By mail to the insurance carrier - On the insurance carrier's website - Over the phone

- On the insurance carrier's website - Over the phone

Which of the following are NOT forms that need a release signature when the patient arrives at the office in order to bill correctly? - Forms authorizing the release of information to an insurance carrier - Patient medical history forms - Forms for assignment of benefits - Records release forms requested from the office from prior physicians

- Patient medical history forms - Records release forms requested from the office from prior physicians

What patient information can be found on a patient's charge slip? - Patient name - Diagnosis - Emergency contact - Treatment - Last office visit date

- Patient name - Diagnosis - Treatment

Which types of patient information will you need to obtain to file an insurance claim? - Patient's current employer - Patient's home telephone number - Name of the subscriber or insured - Patient's Social Security number - Employer's address and telephone number

- Patient's current employer - Name of the subscriber or insured - Employer's address and telephone number

When calling an insurance company for prior authorization, which information should you have available? - Patient's name and date of birth - Date of expiration for the authorization - Patient's group number and ID number - ICD code for the planned procedure and CPT code for the diagnosis - CPT code of planned procedure and the ICD code for the diagnosis

- Patient's name and date of birth - Patient's group number and ID number - CPT code of planned procedure and the ICD code for the diagnosis

Which of the following are roles of clearinghouses? - Translate nonstandard formats into standard formats - Send claims without using software checks for errors - "Scrub" claims "clean" prior to submission - Create and modify data content

- Translate nonstandard formats into standard formats - "Scrub" claims "clean" prior to submission

When reviewing a claim that has been denied, examine all ______ and compare it with the patient's insurance information. - diagnosis codes - copayments made - employment history - procedural codes

- diagnosis codes - procedural codes

To transmit claims ______, providers and payers need information systems to conduct electronic data interchange. - on paper - manually - directly - electronically

- directly - electronically

After reviewing and accepting a claim, an insurer pays a benefit and sends a(n) - explanation of payment (EOP). - remittance advice (RA). - explanation of denials. - remainder statement.

- explanation of payment (EOP). - remittance advice (RA).

5 Facts about CHAMPVA

1. Covers dependent spouses and children of veterans 2. Eligibility determined by local veteran affairs office 3. Covers surviving spouses and children 4. Participants can have a physician of their choice 5. Physicians can decide to accept patients

3 components of preferred provider organization (PPO)

1. Network of providers, but members may see any physician they choose 2. Physicians agree to charge discounted fees 3. Members may choose to see physicians outside the network but must pay more for these visits

The X12 837 transaction requires a lot of information, and all of it must be correct. Most billing programs or claim transmission programs automatically reformat data such as dates into the correct formats. These data elements are reported in five major sections:

1. Provider 2. Subscriber (the insured or policyholder) 3. Patient (who may be the subscriber or another person) 4. Claim details 5. Services

Place the steps taken for a rejected or denied claim in order, with the first step on top. - Submit a corrected claim to obtain payment. - Review the claim, examining all procedure and diagnosis codes for accuracy. - Contact the insurance company by telephone to find out how to resolve the problem.

1. Review the claim, examining all procedure and diagnosis codes for accuracy. 2. Contact the insurance company by telephone to find out how to resolve the problem. 3. Submit a corrected claim to obtain payment.

Beginning with the first step on top, the steps you should take after obtaining personal and insurance information from the patient. - Have the patient sign a waiver of liability, if applicable in your office. - Scan or copy the patient's insurance card. - Remind the patient that some services may not be covered.

1. Scan or copy the patient's insurance card. 2. Remind the patient that some services may not be covered. 3. Have the patient sign a waiver of liability, if applicable in your office.

What percent of the allowable fee does Medicare pay the healthcare provider after the annual deductible is met?

80%

fee-for-service

A major type of health plan. It repays policyholders for the costs of healthcare that are due to illness and accidents.

When do physicians write a charge slip? A) After completing the visit, before the patient checks out B) Before an encounter with the patient C) During the patient examination D) After completing the visit and the patient has left the office

A) After completing the visit, before the patient checks out

capitation

A payment structure in which a health maintenance organization prepays an annual set fee per patient to a physician.

* Which of the following is not performed by the medical practice when preparing a healthcare claim for payment and reviewing the insurance payment? A) Submitting the employer's first report of illness or injury B) Obtaining patient information C) Delivering services to the patient and determining the diagnosis and fee D) Recording charges and codes, recording payment from the patient, and preparing and submitting the healthcare claim E) Reviewing the insurer's processing of the claim, remittance advice, and payment

A) Submitting the employer's first report of illness or injury

Why must there be a signed authorization to release information in a patient's financial record? A) To give legal permission to give the insurance carrier information regarding the patient's diagnosis and treatment B) To give permission for the insurance carrier to send payment to the provider C) To give permission to release information to another provider for treatment D) To give permission for the insurance carrier to send payment to the patient

A) To give legal permission to give the insurance carrier information regarding the patient's diagnosis and treatment

An explanation of payment (EOP) is sometimes called a(n) A) explanation of benefits (EOB). B) explanation of insurance (EOI). C) payment advice (PA). D) payment statement (PS).

A) explanation of benefits (EOB).

Which of the following is not part of the process for verifying workers' compensation coverage? A) getting the name and policy number of the patient's personal health insurance policy B) obtaining the employer's verification that the accident was work-related C) asking the verifier at the patient's company for the original date of the injury D) getting the name of the verifier at the patient's company E) asking if the company has opened a workers' compensation case with the insurance company

A) getting the name and policy number of the patient's personal health insurance policy -- The patient's personal health insurance policy number is not needed for a workers' compensation claim.

If you hear someone refer to a "5010 claim," that person is speaking of A) the current format for electronic claims submission. B) the CMS-1500 form. C) the advance beneficiary notice of noncoverage. D) the paper form for Medicare claims.

A) the current format for electronic claims submission.

geographic adjustment factor (GAF)

An adjustment factor used to reflect the area of the country where the service was performed

The paper claim alternative to the X12 837 is the A) X12 900. B) CMS-1500. C) CMS-2000. D) UB-04.

B) CMS-1500.

What is the first item an insurance carrier reviews when receiving a claim? A) Charges B) Date of service C) Procedures performed D) Patient diagnosis

B) Date of service

Which of the following is a disadvantage to direct data entry? A) The Internet-based service keeps the patient's prior information within its database. B) Each claim must be hand-keyed into the system each time the patient is seen. C) Data elements must meed HIPAA standards requirements. D) EDI formatting is not required.

B) Each claim must be hand-keyed into the system each time the patient is seen.

* The national health insurance plan for Americans age 65 and older is A) Medicaid B) Medicare C) TRICARE D) CHAMPVA E) Workers' compensation

B) Medicare

Which of the following does NOT happen during patient check out? A) The provider accepts payment from the patient for the full amount. B) The provider fills out a superbill or charge slip. C) The provider prepares a claim and transmits it to the insurance company. D) The provider accepts an insurance copayment or coinsurance from the patient.

B) The provider fills out a superbill or charge slip.

A healthcare claim without any errors is known as a _____ claim. A) perfect B) clean C) nice D) spotless

B) clean

* A fixed-dollar amount the subscriber must pay, or "meet," each year before the insurer begins to cover expenses is the: A) copayment. B) deductible. C) premium. D) coinsurance. E) lifetime maximum.

B) deductible.

It is necessary to obtain ______ signatures on release of information and assignment of benefits form. A) payer B) patient C) provider D) physician

B) patient

relative value unit (RVU)

Based on the physician's work, the practice cost and the cost of medical malpractice

Which of the following is NOT a method used to transmit claims electronically? A) Direct data entry B) Direct transmission to payer C) Clearinghouse use D) CMS-1500 form

D) CMS-1500 form

Medicare allows ______ for filing claims from the date of service. A) 90 days B) 1 month C) 1 year D) 6 months

C) 1 year

Coordination of benefits clauses prevent payment duplication by restricting insurance company payments to no more than ______% of the covered benefit's cost. A) 50 B) 80 C) 100 D) 90

C) 100

In which method of electronic claims transmission do medical offices and payers exchange transactions directly using EDI? A) PQRI B) Direct data entry C) Direct transmission D) Clearinghouse

C) Direct transmission

Paper claims are not widely used because of current mandates set forth by A) insurance company B) Medicare C) HIPAA D) provider

C) HIPAA

* The appropriate definition for a Medicaid plan is A) Health insurance plan B) Welfare C) Health benefit plan D) Liability plan E) Health insurance benefit

C) Health benefit plan

* Which of the following documents provides information regarding the payer's payment (or denial) of charges received? A) RA B) EOB C) RA or EOB D) Claims register E) 1505

C) RA or EOB

Which of the following guidelines is applicable when filing a Medicaid claim and interacting with Medicaid patients? A) Allow a 2-year time limit on all claim submissions. B) Submit claims without proving patient eligibility for benefits. C) Treat the patient as if he or she has private insurance. D) Submit claims without proving Medicaid membership. E) Send claims to the national claims center.

C) Treat the patient as if he or she has private insurance. -- Treat Medicaid patients with the same professionalism and courtesy you extend to private-pay patients. People who qualify for Medicaid assistance are in no way inferior to those with private insurance.

Which of the following is an electronic claim transaction, the HIPAA Health Care Claim or Equivalent Encounter Information? A) HCPCS 10 B) HIPAA 1500 C) X12 837 D) ICD-10-CM

C) X12 837

It is essential to verify that procedures checked off on superbill forms were actually completed by A) obtaining verification from the patient's insurance. B) obtaining verbal verification from the physician that it is correct. C) comparing the superbill to the medical record. D) obtaining verification from the patient that the superbill is correct.

C) comparing the superbill to the medical record.

A policy that pays benefits first when a patient is covered by more than 1 insurance plan is called A) Medicare. B) supplemental insurance. C) primary insurance. D) secondary insurance.

C) primary insurance.

Which of the following is correct regarding electronic claim submissions?

Claims are prepared for transmission after all required data elements have been entered.

Mrs. Lawrence is an elderly diabetic patient who is on Medicare. She recently injured her lower left leg, and since then has had trouble with open sores or ulcers on that leg. She came to the office last week to have the provider examine and treat the ulcers. At that time, you checked, and she qualified for Medicaid as well as Medicare. She has come to the office today for follow-up care and treatment. Which of the following should you do first?

Contact Medicaid to verify her eligibility.

3. Coordinated care

Coordination of care across the spectrum of healthcare

Workers' Compensation

Covers employment-related accidents or diseases

The Medicare Part D prescription drug plan coverage began in the year ______. A) 2011 B) 2009 C) 1997 D) 2006

D) 2006

Which of the following must be verbally discussed with a Medicare beneficiary to enable the beneficiary to consider options and make informed choices? A) CHIP B) DRG C) RBRVS D) ABN E) GAF

D) ABN -- The ABN, or Advance Beneficiary Notice of Noncoverage, must be verbally reviewed with the beneficiary or his or her representative and any questions raised during that review must be answered before it is signed.

What is the most a payer will pay any provider for a procedure or service? A) Capitation B) Balanced charge C) Fee schedule D) Allowed charge

D) Allowed charge

* Which of the following is the most common method for medical practices to submit electronic medical claims to third-party payers? A) Paper claims via US mail B) DDE C) Direct submission D) Clearinghouse E) DDE and paper claims

D) Clearinghouse

In which method of electronic claims transmission are all required data sent to an outside company to translate into standard formats and to "scrub" the claims? A) Direct data entry B) Direct claims transmission C) Manual data entry D) Clearinghouse

D) Clearinghouse

Which of the following is NOT a task a medical billing program can perform when processing claims? A) Recording the procedures and services performed B) Verifying patient coverage C) Gathering and recording patient information D) Collecting payments from patients

D) Collecting payments from patients

In insurance policies, what is the legal clause that prevents duplication of payment? A) Balance billing B) Allowable charge C) Birthday rule D) Coordination of benefits

D) Coordination of benefits

What does the acronym DDE mean? A) Dividend data entry B) Direct digital entry C) Dividend digital entry D) Direct data entry

D) Direct data entry

* Why is it important that each procedure on the CMS-1500 be matched with a diagnosis code? A) It proves the procedure was performed B) It keeps the coder employed C) It increases the reimbursement amount D) It proves medical necessity for the procedure E) It truly does not matter

D) It proves medical necessity for the procedure

Which of the following information do you NOT need in order to obtain prior authorization for a procedure? A) Procedure and CPT code B) Insurance policy number C) Diagnosis and ICD-9 code D) Next of kin

D) Next of kin

Which of the following is NOT a major section of the X12 837? A) Services B) Subscriber C) Provider D) Prescriptions E) Claim details F) Patient

D) Prescriptions

* RBRVS consists of which component(s)? A) RVU B) GAF C) CF D) RVU, GAF, and CF E) RVU and CF only

D) RVU, GAF, and CF

Which type of review compares doctor's fees with patients' health insurance benefits to determine subscriber liability? A) Review for accuracy B) Review for medical necessity C) Review for procedures and services D) Review for allowable charges

D) Review for allowable charges

Medical ______ is translating medical terminology to procedure and diagnosis codes onto healthcare claim forms. A) transcription B) dictation C) billing D) coding

D) coding

The amount a patient owes the practice is known as A) payer responsibility. B) patient responsibility. C) provider liability. D) patient liability.

D) patient liability.

Claims transmitted for payment will undergo a number of ______ by the insurer. A) amendments B) changes C) denials D) reviews

D) reviews

There are ______ major methods used to transmit claims electronically. A) four B) five C) two D) three

D) three -- Three major methods are used to transmit claims electronically: direct transmission to the payer, clearinghouse use, and direct data entry.

For claims submitted electronically, the billing program creates a log of transmitted claims to allow A) changes to be made to claims. B) claims to be changed by the insurer. C) reviews to be made by the insurer. D) tracking of the progress of claims.

D) tracking of the progress of claims.

The deductible must be met every ______ before the third-party payer begins to cover medical expenses. A) month B) visit C) week D) year

D) year

What should you do with the authorization number once you have prior approval?

Document it in the financial record and on all forms associated with the procedure.

explanation of payment (EOP)

Document sent by an insurance carrier when payment is made describing the terms of the payments. Also known as explanation of benefits (EOB) or remittance advice (RA).

* Most specialists are paid by MCOs using which of the following methods? A) Fee-for-service B) Capitation C) Copayment D) Coinsurance E) Negotiated per-service fees

E) Negotiated per-service fees

* Depending upon the type of plan, the patient's portion of the medical charges after the insurance has paid is known as the: A) copayment. B) deductible. C) coinsurance. D) premium. E) copayment or coinsurance.

E) copayment or coinsurance.

5. Quality and safety

Engaging in evidenced-based medicine

explanation of benefits (EOB)

Information that explains the medical claim in detail; also called remittance advice (RA).

Medicare

Insurance for those 65 or older or those under 65 who. are disabled or diagnosed with certain conditions

4. Accessible service

Shorter wait time

You are asked to obtain prior approval from Mr. Post's insurance provider for a procedure. Why would this be necessary?

So the insurance company will pay for the procedure

allowed charge

The amount that is the most the payer will pay any provider for each procedure or service. Can also be called maximum allowable fee, maximum charge, allowed amount, allowed fee, and allowable charge.

premium

The basic annual cost of healthcare insurance.

What is the birthday rule?

The insurance policy of the policyholder whose birthday comes first in the calendar year is the primary payer for all dependents.

In addition to the authorization number, what additional information should you document when you obtain prior authorization by phone?

The name and extension number of the person giving authorization

Which of the following is included in Medicare benefits for respite care?

The terminally ill patient is moved to a care facility for the respite.

conversion factor (CF)

Used to make adjustments according to the cost-of. living index

When will you use the authorization number if Mr. Post's procedure is being done within your practice?

You will use it when submitting the insurance claim.

An appropriate approach to maintaining patient confidentiality on the computer is to __________.

change your password every 90 days

The usual fees that are listed on the medical office's fee schedule are fees __________.

charged to most of their patients most of the time under typical conditions

The fixed dollar amount a subscriber must pay or "meet" each year before the insurer begins to cover expenses is the __________.

deductible

The most likely outcome of an insurance claim submitted with a diagnosis code of a sore throat and a treatment code indicating a cast for a broken leg would be __________.

denied because the treatment was not medically necessary based on the diagnosis

How should data in medical billing programs be entered?

enter information using capital letters

Which of the following types of insurance covers injuries that are caused by the insured or that occurred on the insured's property?

liability

Which of the following groups are not covered by TRICARE or CHAMPVA?

non-military government employees

When the insured person pays an annual cost for healthcare insurance, it is called a __________.

premium

When obtaining prior authorization electronically, you will be able to

print the authorization.

The payment system used by Medicare is based on __________.

resources -- Medicare uses a resource-based relative value scale to determine the fees they pay for services rendered.

An insurance claims department compares the fee the doctor charges with the benefits provided by the patient's health plan. This is called the __________.

review for allowable benefits

The person whose name the insurance is carried under is called the __________.

subscriber

What is the term for the 10-digit number that identifies the provider's medical specialty?

taxonomy code

The electronic claim transaction is the HIPAA Healthcare Claim or Equivalent Encounter Information, commonly referred to as...

the "HIPAA (or 5010) claim" or simply the "837P claim" (P for physician). Its official name is X12 837 Health Care Claim. If you hear someone refer to a "5010 claim," he is speaking of the current format for electronic claims submission.

The licensed practitioner who examines the patient notes the patient's symptoms, a diagnosis, a treatment plan (including prescribed medications), and if and when the patient should return for a follow up visit-all in the medical record. After completing the visit, the practitioner __________ the diagnosis, treatment, and sometimes the fee on an encounter form (superbill)

writes

Obtain the following insurance information:

• Current employer (may be more than one). • Employer address and telephone number. • Insurance carrier and effective date of coverage. • Insurance group plan number. • Insurance identification number. • Name of subscriber or insured.

In offices that use electronic billing, medical assistants use the medical billing program to support administrative tasks such as:

• Gathering and recording patient information. • Verifying patients' insurance coverage. • Recording procedures and services performed. • Recording applicable diagnosis and codes for each procedure performed. • Filing insurance claims and billing patients. • Reviewing and recording payments.

When the patient first arrives, obtain or verify the following personal information:

• Patient name (be sure to get the correct spelling of the patient's legal name). • Current home address. • Current home telephone number. • Date of birth (month, day, and the four digits of the year). • Social Security number. • Next of kin or person to contact in case of an emergency.

When the patient brings you the superbill at the end of the visit, you may do one or more of the following, depending on your practice's policy:

• Prepare and transmit a healthcare claim on behalf of the patient directly to the insurance company. • Accept payment from the patient for the full amount. The patient will submit a claim to the insurance carrier for reimbursement. With offices increasingly submitting electronic claims, this option is becoming less common. • Accept an insurance copayment or coinsurance from the patient and credit the account appropriately.

Which of the following are synonyms for the term allowed charge? - Minimum fee - Allowed amount - Minimum allowable charge - Maximum allowable fee - Maximum charge

- Allowed amount - Maximum allowable fee - Maximum charge

Which of the following are covered by TRICARE? - Individuals who were 100% service-related disabled - Families of uniformed personnel - Retirees from uniformed services - Uniformed personnel - Families of veterans who have died in the line of duty

- Families of uniformed personnel - Retirees from uniformed services - Uniformed personnel

copayment

A fixed or set amount paid for each healthcare or medical service; the remainder is paid by the health insurance plan. Also called a copay.

Which organization manages Medicare? A) Centers for Social Security and Retirement B) Department of Health and Human Services C) Centers for Disease Control and Prevention D) Centers for Medicare and Medicaid Services

D) Centers for Medicare and Medicaid Services

Third party is the...

Health plan

First party is the...

Patient (policyholder)

benefits

Payments for medical services.

The State Children's Health Insurance Plan was reenacted in ______. A) 2009 B) 2013 C) 1997 D) 2006

A) 2009

What is another term for fee-for-service plan? A) Indemnity plan B) Fee payment plan C) Health maintenance plan D) Managed care plan

A) Indemnity plan

Medicare Part C was introduced in ______. A) 2001 B) 2006 C) 1997 D) 1990

C) 1997

Individuals entitled to Medicare Part A benefits automatically qualify for A) Medicaid. B) Part D. C) Part B. D) Part C.

C) Part B.

Where are fees generally listed? A) Lab form B) Fee form C) Lab report D) Fee schedule

D) Fee schedule

1. Comprehensive care

The medical team is responsible for the majority of the patients' physical and mental health

Which benefits are NOT covered under workers' compensation? - Yearly sums paid to patients for permanent or temporary disability - Death benefits -Basic medical treatment - Rehabilitation costs to restore employees' ability to return to work -Costs such as utilities and rental payments up to 1 year of missed compensation - Weekly or monthly sums paid to patients for permanent disability

- Yearly sums paid to patients for permanent or temporary disability - Costs such as utilities and rental payments up to 1 year of missed compensation

The major types of health plans are - government - HMO. - fee-for-service - managed care

- fee-for-service - managed care

All payers require patients to pay for ______ services. - covered - noncovered - excluded - included

- noncovered - excluded

All Medicare beneficiaries can enroll in Medicare ______, which provides prescription drug benefits. A) part D B) part B C) part C D) part A

A) part D

Each state's or local BCBS organization operates under A) state laws. B) individual laws. C) federal government laws. D) local laws.

A) state laws.

There are ______ major types of health plans? A) two B) five C) one D) seven

A) two -- There are two major types of health plans: traditional fee-for-service plans and managed care plans.

In exchange for paying a premium, a health plan provides ______ for medical services for a specified period of time. A) premiums B) deductibles C) credits D) benefits

D) benefits

Second party is the...

Physician

dual coverage

Term used when a patient is covered by Medicare and Medicaid.

17.4 Describe allowed charge, contracted fee, capitation, and the formula for RBRVS.

- An allowed charge is the maximum dollar amount an insurance carrier will base its reimbursement on-it is also the maximum amount a participating provider is allowed to collect. - A contracted fee is a negotiated fee between the Managed Care Organizations (MCO) and the provider. - Capitation is a fixed prepayment paid to the Primary Care Physician (PCP) in most plans. - RBRVS stands for resource-based relative value scale. Its formula is RVU × GAF x CF. 1. The national uniform relative value unit (RVU). The relative value of a procedure is based on three cost elements: the physician's work, the practice cost (overhead), and the cost of malpractice insurance. For example, the relative value unit for a simple office visit-say, to administer a flu shot-is much lower than the relative value for a complicated encounter, such as planning a patient's treatment of uncontrolled diabetes. 2. A geographic adjustment factor (GAF). A GAF is used to adjust each relative value to reflect a geographic area's relative costs, such as office rent and utilities. 3. A nationally uniform conversion factor (CF). A uniform CF is a dollar amount used to multiply the relative values to produce a payment amount. It is used by Medicare to make adjustments according to changes in the cost-of-living index.

In addition to premiums, which of the following may patients be obligated to pay? - Deductibles - Noncovered service charges - Allowed charges - Preventive service charges - Copayments

- Deductibles - Noncovered service charges - Copayments -- In addition to premiums, patients may be obligated to pay deductibles, copayments, coinsurance, excluded and over-limit services, and balance billing (only if allowed by the insurance plan).

17.2 Compare fee-for-service plans, HMOs, and PPOs and explain the new concept of patient-centered medical home.

- Fee-for-service plans are traditional plans where, after a yearly deductible is met, the insurance plan pays for a percentage of the charges and the patient is responsible for the other percentage (often 80% insurance plan and 20% patient). - Health Maintenance Organizations (HMOs) are prepaid plans that pay the providers either by capitation or by contracted fee-for-service with patients choosing a PCP, seeing preferred providers, and paying a fixed per-visit copay. - A Preferred Provider Organization (PPO) is a managed care plan that establishes a network of providers to perform services for plan members. Members may seek out-of-network care, but their costs will be higher. - The patient-centered medical home model is a new approach to preventive care that puts the patient and family at the center of the decision-making process using a coordinated team approach to patient care.

To have children be eligible for health coverage under SCHIP, a family must meet which requirements? - Insurance under a private insurance policy - Income too high to qualify for Medicaid - Income too high to qualify for Medicare - Income too low to afford private insurance

- Income too high to qualify for Medicaid - Income too low to afford private insurance

17.3 Outline the key requirements for coverage by the Medicare, Medicaid, TRICARE, and CHAMPVA programs.

- Medicare provides health insurance for citizens aged 65 and older as well as for certain disabled workers, disabled widows of workers, and patients with long-term disability related to chronic kidney disease on dialysis and end-stage renal disease requiring transplant. - Medicaid is a health benefit plan for low-income, blind, or disabled patients; needy families; foster children; and children born with birth defects. - TRICARE is a healthcare benefit for families of uniformed personnel and retirees from the uniformed services. - CHAMPVA covers the expenses of the families of veterans with total, permanent, service-connected disabilities as well as expenses for surviving spouses and dependent children of veterans who died in the line of duty or as a result of service-connected disabilities.

Services that would be covered under Medicare Part A: (6)

- Patients who are admitted as inpatients for up to the 90-day benefit period. - A patient who has been admitted to a skilled nursing facility (SNF) after inpatient hospitalization. - A patient who is receiving medical care at home. - A patient receiving hospice care either at home or in a hospice facility. - A patient who requires psychiatric treatment. - A patient who requires respite care.

Identify the individuals who are eligible for Medicare. - Low-income families - Retired military personnel - People who are blind - Workers with chronic kidney disease requiring dialysis

- People who are blind - Workers with chronic kidney disease requiring dialysis -- The largest federal program providing healthcare is. Medicare, which provides health insurance for citizens aged 65 and older. Other people who are eligible for Medicare include people under the age of 65 who are dependent widows aged 50 to 65, the disabled, the blind, and workers of any age who have chronic kidney disease requiring dialysis or end-stage renal disease (ESRD) requiring transplant. Kidney donors are also eligible for Medicare.

The assignment of benefits statement states which of the following? - The provider may balance bill a patient for covered charges. - The provider accepts a payer's allowed charge. - The provider receives payment directly from the payer. - The patient receives payment directly from the payer.

- The provider accepts a payer's allowed charge. - The provider receives payment directly from the payer. -- When patients have office visits with a provider who participates in the plan under which they have coverage, such as a Medicare-participating (PAR) provider, they generally sign an assignment of benefits statement. With this statement, the provider agrees to prepare and submit healthcare claim forms for patients, to receive payments directly from the payers, and to accept a payer's allowed charge.

Which areas of assistance does Medicaid cover? - Elective surgeries - Vaccines for children - Diagnostic screening and treatment for patients over 21 - Physician services - Lab services and X-rays - Emergency services

- Vaccines for children - Physician services - Lab services and X-rays - Emergency services

Written contracts in the form of a policy between a policyholder and a health plan are also called - health insurance. - annual deductibles. - policy copayments. - medical insurance.

- health insurance. - medical insurance.

Premiums are paid by - providers. - subscribers. - policyholders. - health plans.

- subscribers. - policyholders. -- The policyholder also may be called the insured, themember, or the subscriber.

Which websites provide information about Medicare? - www.medicaid.gov - www.cms.gov - www.dhhs.gov - www.medicare.gov

- www.cms.gov - www.medicare.gov

Workers' compensation laws vary from state to state, but, in most states, this insurance includes these benefits: (5)

1. Basic medical treatment 2. A weekly amount paid to the patient for a temporary disability, which compensates workers for loss of income until they can return to work 3. A weekly or monthly sum paid to the patient for a permanent disability 4. Rehabilitation costs to restore an employee's ability to work again 5. Death benefits for survivors

3 components of health maintenance organization (HMO)

1. Patients pay premiums and co-pays 2. Only certain services are covered 3. Does not pay for seeing physicians that are not participating

6 Facts about TRICARE

1. Run by the defense department 2. Not a health insurance plan 3. For families of the uniformed personnel and retirees 4. Offers three healthcare benefits: TRICARE Prime, TRICARE Extra, TRICARE Standard 5. Can also receive Medicare benefits 6. Physicians can decide to accept patients

precertification

A determination of the amount of money that will be paid by a third-party payer for a specific procedure before the procedure is conducted.

deductible

A fixed dollar amount that must be paid by the insured before additional expenses are covered by an insurer.

coinsurance

A fixed percentage of covered charges paid by the insured person after a deductible has been met.

remittance advice (RA)

A form that the patient and the practice receive for each encounter that outlines the amount billed by the practice, the amount allowed, the amount of subscriber liability, the amount paid, and notations of any service not covered, including an explanation of why that service is not covered; also called an explanation of benefits.

clearinghouse

A group that takes nonstandard medical billing software formats and translates them into the standard EDI formats.

third-party payer

A health plan that agrees to carry the risk of paying for patient services.

patient-centered medical home (PCMH)

A healthcare model designed to change the organization and delivery of primary care in the United States. Primary functions include comprehensive, patient-centered, coordinated care that is accessible and ensures the quality and safety of healthcare provided.

health maintenance organization (HMO)

A healthcare organization that provides specific services to individuals and their dependents who are enrolled in the plan. Doctors who enroll in an HMO agree to provide certain services in exchange for a prepaid fee. -- Type of managed care organization in which physicians are often paid a capitated rate or a salary by the organization -- Only offers in-network benefits; providers usually paid by capitation

fee schedule

A list of the costs of common services and procedures performed by a physician.

preferred provider organization (PPO)

A managed care plan that establishes a network of providers to perform services for plan members. -- Offers in- and out-of-network benefits; discounts are. given for using network providers

elective procedure

A medical procedure that is not required to sustain life but is requested for payment to the third-party payer by the patient or physician. Some elective procedures are paid for by third-party payers, whereas others are not. -- Procedure done at the convenience of the physician or patient

dependent

A person who depends on another person for financial support.

birthday rule

A rule that states that the insurance policy of a policyholder whose birthday comes first in the year is the primary payer for all dependents.

The health-cost assistance program run by CMS and designed for low-income, blind, or disabled patients and needy families is A) Medicaid. B) Medicare. C) CHAMPVA. D) Tricare.

A) Medicaid. -- Medicaid, also run by CMS, is a health-benefit program designed for low-income, blind, or disabled patients; needy families; foster children; and children born with birth defects. Medicaid is a health cost assistance program, not an insurance program.

Which federal insurance plan is the largest plan covering citizens age 65 and older? A) Medicare B) TriCare C) CHAMPVA D) Medicaid

A) Medicare

Which part of Medicare provides several plan choices for individuals called Medicare Advantage plans? A) Part C B) Part A C) Part B D) Part D

A) Part C -- Medicare Part C, introduced in 1997, provides several plan choices for individuals called Medicare Advantage plans. These include PPOs, HMOs, private fee-for service (PFFS) plans, special needs plans, and Medicare medical savings account (MSA) plans.

Who is responsible for costs that are not covered by the third-party insurance company? A) Patient B) Insurance company C) Medical assistant D) Practitioner

A) Patient

Which type of insurance covers employment-related accidents or diseases? A) Workers' compensation B) Medigap C) Disability reimbursement D) SCHIP

A) Workers' compensation

Fees that physicians charge most of their patients, most of the time, under typical conditions are called A) usual fees. B) allowed charges. C) regular fees. D) average fees.

A) usual fees.

preauthorization

Authorization or approval for payment from a third-party payer requested in advance of a specific procedure. -- Process in which a provider contacts an insurer to see if a proposed procedure is a covered service under the patient's plan

Under the new healthcare act, parents will be allowed to keep their children covered under their family policy until age ______. A) 25 B) 26 C) 18 D) 21

B) 26 -- On March 23, 2010, President Barack Obama signed into law a healthcare overhaul bill known as the Affordable Care Act (ACA), also referred to as "Obamacare." The core of this new law, which has taken several years to fully phase in, is the extension of insurance coverage to all Americans who lack healthcare coverage. This new law mandates that individuals buy insurance and if they do not they will have to pay a fine. Also included in the law are bans on the ability of private insurance carriers to impose lifetime limits on coverage, to deny coverage for preexisting conditions, and to cancel a policy when an insured person becomes ill. Parents in many circumstances also can keep their children covered under the family policy until age 26.

Which of the following, signed by patients, allows a provider to submit healthcare claims for the patients? A) Accepting assignment B) Assignment of benefits C) Coordination of benefits D) Balanced billing

B) Assignment of benefits -- When patients have office visits with a provider who participates in the plan under which they have coverage, such as a Medicare-participating (PAR) provider, they generally sign an assignment of benefits statement. With this statement, the provider agrees to prepare and submit healthcare claim forms for patients, to receive payments directly from the payers, and to accept a payer's allowed charge.

Which president signed into law a bill that will extend insurance coverage to all Americans who lack healthcare coverage? A) George W. Bush B) Barack Obama C) Bill Clinton D) Ronald Reagan

B) Barack Obama -- On March 23, 2010, President Barack Obama signed into law a healthcare overhaul bill known as the Affordable Care Act (ACA), also referred to as "Obamacare."

Which of the following is a fixed dollar amount that must be met, in addition to the premium, before the third party will pay for medical services? A) Copay B) Deductible C) Coinsurance D) Premium

B) Deductible

Medicare Part A is financed through A) state taxes. B) FICA tax on earned income. C) government grants. D) Social Security taxes.

B) FICA tax on earned income. -- (Federal Insurance Contributions Act)

Which of the following is another name for medical insurance? A) Medical liability B) Health insurance C) Policyholder D) Policy copayment

B) Health insurance

The oldest and most expensive type of health plan is A) managed care. B) fee-for-service. C) Medicare. D) HMO.

B) fee-for-service.

BCBS (Blue Cross and Blue Shield) is a nationwide federation of organizations that provide ______ healthcare services to subscribers. A) emergency B) prepaid C) low-quality D) free

B) prepaid

In an 80-20 coinsurance rate, the patient is responsible for what percentage of allowed charges? A) Cannot be determined B) 80 C) 20 D) 100

C) 20 -- The patient also may have to pay coinsurance-a fixed percentage of covered charges after the deductible is met. The coinsurance rate represents the health plan's percentage of the charge followed by the insured's percentage, such as 80-20. This means the insurance carrier pays 80% of allowed charges and the patient is responsible for the remaining 20%.

Which of the following is a fixed percentage of covered charges that must be paid after the deductible is met? A) Premium B) Deductible C) Coinsurance D) Copayment

C) Coinsurance

Medicare Part B is a type of health insurance that is provided to citizens aged 65 and older and provides health benefits for office services, but is A) mandatory. B) 100% paid for. C) voluntary. D) paid for by the state.

C) voluntary.

Which payer uses resource-based relative value scale to set fees? A) Medicaid B) TRICARE C) BCBS D) Medicare

D) Medicare

The part of Medicare is billed by hospitals is A) Part D B) Part B C) Part C D) Part A

D) Part A

Which of the following is a charge for keeping an insurance policy in effect? A) Copayment B) Coinsurance C) Deductible D) Premium

D) Premium -- usually monthly

Which payment system is used by Medicare? A) RBUCR B) UCR C) RVS D) RBRVS

D) RBRVS -- (resource-based relative value scale)

When is the patient-physician contract created? A) When the patient chooses a primary care physician B) When the health plan agrees to provide benefits for treatment C) When a patient schedules an appointment with a physician D) When a physician agrees to treat a patient who seeks services

D) When a physician agrees to treat a patient who seeks services

A health plan provides payment, otherwise known as ________, for medical services. A) subscribers B) policyholders C) health plans D) benefits

D) benefits

There are ______ functions and attributes to the PCMH (Patient-Centered Medical Home). A) four B) seven C) six D) five

D) five 1. Comprehensive Care 2. Patient Centered 3. Coordinated Care 4. Accessible Service 5. Quality and Safety

There are ______ functions and attributes to the PCMH. A) seven B) six C) four D) five

D) five 1. Comprehensive Care 2. Patient Centered 3. Coordinated Care 4. Accessible Service 5. Quality and Safety

TRICARE is run by A) DHHS. B) CMS. C) state governments. D) the Defense Department.

D) the Defense Department. -- Run by the Defense Department, TRICARE (formerly known as Civilian Health and Medical Program for Uniformed Services, or CHAMPUS) is not a health insurance plan. Rather, it is a healthcare benefit for families of uniformed personnel and retirees from the Army, Navy, Marines, Air Force, Coast Guard, Public Health Service, and National Oceanic and Atmospheric Administration

Although the patient is legally responsible for paying for healthcare services, the ______ party agrees to carry the risk for those services. A) first B) second C) private D) third

D) third

Medicaid

Health-benefit plan for low-income, blind, disabled, and foster children, children born with birth defects

TRICARE/CHAMPVA

Healthcare benefits to families of military personnel, veterans, and retired military personnel

2. Patient centered

Practitioners partner with the patient and family with understanding and respect

17.1 Define the basic insurance terms used by the insurance industry.

The following are terms used by insurance companies, knowledgeable medical assistants, medical billers, and coders: premium - The basic annual cost of healthcare insurance. benefit - Payments for medical services. lifetime maximum - A total sum the health plan will pay out over the patient's lifetime. deductible - A fixed dollar amount that must be paid by the insured before additional expenses are covered by an insurer. coinsurance - A fixed percentage of covered charges paid by the insured person after a deductible has been met. copayment - A fixed or set amount paid for each healthcare or medical service; the remainder is paid by the health insurance plan. Also called a copay. exclusions - noncovered expenses under the insured contract such as routine eye examinations or dental care. formulary - A list of approved drug brands. elective procedure - Procedure done at the convenience of the physician or patient. precertification - A determination of the amount of money that will be paid by a third-party payer for a specific procedure before the procedure is conducted. preauthorization - Process in which a provider contacts an insurer to see if a proposed procedure is a covered service under the patient's plan.

resource-based relative value scale (RBRVS)

The payment system used by Medicare. It establishes the relative value units for services, replacing the providers' consensus on usual fees.

utilization review (UR)

The process of reviewing medical care in individual cases to be sure that all services provided were medically necessary and that there was appropriate use of medical resources; performed by medical peers and used as a cost control measure by managed care organizations.