CRCR Unit 4 (4.1 - 4.9) Post-Service - Financial Care

Control points for cash posting should be established in 3 area's

1. Checks received through mail - A. Opened and immediately endorsed with a manual or computerized slip run. The checks can be deposited & copies used for the actual posting. B. Ideally, depending on staff availability, a second person should do the payment posting, and the balance of payments posted should be independently verified against the total of checks received. 2. Cash received through mail - A. Staff who open mail should be instructed to immediately bring any cash received in the mail to a supervisors attention for special handling. 3. Lock box - A. Many healthcare providers have eliminated mail payment deliver to their patient accounts department through the use of lock boxes. B. Lock box processing not only improves security but also expedites the deposit of funds into the healthcare providers account. Banks are also capable of providing the deposit details via an ERA (Electronic Remittance Advice) file which can then be posted electronically into the patient accounting system

HFMA's Best Practices - Financial Care

1. Make bills patient-friendly a. All financial communications should be clear, concise, correct, and patient friendly. Following the guidelines developed for the HFMA's Patient-Friendly Billing Project will allow providers to generate a bill that contains the right amount of detail and correctly reflect the financial aspects of a care episode. 2. Establish policies and ensure that they are followed a. All activities in pursuit of account resolution should be governed by the provider organization's financial assistance, account resolution, and collections policies. These policies should reflect the economic circumstances of the community and be readily available to patient.s 3. Be consistent a. Key aspects of account resolution should be standardized throughout the organization. 4. Coordinate account resolution activities with business affiliates a. At any given point in the account resolution process, only one party should be pursuing the resolution of a particular account. To avoid duplication of patient contact,, accounts should be reconciled with external business affiliates. A provider may choose to use external business affiliates for account resolution as part of an "early-out" strategy. External business affiliates may also be used if an account becomes delinquent. **Account resolution must occur often enough to provide a high level of confidence that the patient is not being contacted about an outstanding account by multiple entities at the same time. 5. Exercise sound business judgement when choosing account resolution methods a. Best practices for account resolution include providers being familiar with their service community and the use of sound business judgement in choosing methods to use for account resolution. Some methods are phone calls, letters, screening (e.g., for bankruptcy, eligibility for financial assistance programs, or third party health plan coverage eligibility), data scoring (for the purpose of financial assistance or payment plan development), and third party loans from reputable providers. **When coordinating the account resolution activity and timing of that activity, providers should always rely on community knowledge and sound judgement. 6. Start the account resolution clock when the first statement is sent. a. Best practices specify that the initial billing to the patient for a patient balance (either true self pay or balance after insurance) should be the starting date for the process to resolve the account. All time-bound activity should be driven by this date. Best practices and the 501(r) regulations specify that providers and business affiliates should wait 120 days after the date of the first bill (with limited exceptions) before reporting a past-due account to credit bureau's or taking other extraordinary collection actions. 7. Report back to credit bureaus when account is resolved. a. Providers may choose not to report past due accounts to credit bureaus. However, if reporting has occurred, the reporting entity (either the provider or the business affiliate) has a responsibility to report back to the bureau if the account is resolved. 8. Track all consumer complaints a. All consumer complaints should be tracked and shared between the provider and business affiliates to improve customer service, hasten account resolution, and avoid reoccurring grievances.

What are the 3 types of denials?

1. Technical 2. Clinical 3. Underpayment

Types of denials

1. Technical - based on missing or incomplete claim information such as: A. Demographic errors B. Incorrect/incomplete insurance information C. No required pre-certification or pre-authorization D. No continued stay authorization E. Exceeded frequency limitations. 2. Clinical - is associated with the care or service provided and may include the following: A. Diagnosis does not correspond to the procedure performed. B. Service is deemed not medically necessary C. Carve-out days (clinical documentation to support care is missing) D. Inappropriate level of care. E. Healthcare Common Procedure Coding System (HCPCS) code is incorrect for procedure performed. 3. Underpayment - occurs when the health plan does not pay the agreed contract amount. The challenge is that this type of denial is not always recognized during payment processing, especially if contractual adjustment are not posted at the tine of billing.

When is a claim denied?

A claim is denied if it passes the rejection criteria previously addressed but does not meet all the health plan's rules. The denial will result in a partial payment, delayed payment, underpayment, or no payment.

Identify the different types of health plan claim rejections and typical reasons for claim rejections

A claim is rejected when the health plan cannot process the claim for payment for any number of reasons. These reasons may include inability to identify the patient, ineligibility of coverage of the patient, or non-compliance of the provider with billing requirements. The first thing a health plan does when processing a claim is to check to see if the patient is covered. The health plan doers this by reviewing the claim data. After the initial check, the claim is reviewed for additional information and will be rejected if the claim does not meet the requirements. These requirements answer the questions: 1. Is the service covered by the policy? 2. Is the service medically necessary based on the submitted diagnosis? 3. Were authorization requirements followed?

Creditor Priority

A creditor who holds some monetary assurance of payment of debt, such as a mortgage, collateral, or a lien, is a secured creditor. Secured creditors always have the first right to payment, whereas an unsecured creditor is at risk of not receiving payment. To the extent that a secured creditor's security (collateral) does not cover his/her claims, the secured creditor becomes an unsecured creditor.

Electronic Remittance Advice (ERA) 835 data set.

A standardized healthcare claim payment remittance advice known as the 835 format is used to electronically send third-party payment details to healthcare providers. There are different levels of automation that can be used.

Line types

A. Agreement B. Judicial process C. Statute

A claim is rejected when the health plan cannot process the claim for payment for a number of reasons

A. Inability to identify the patient B. Ineligibility of the patient C. Non-compliance of the provider with billing requirements.

What is claim data

A. Patient's name and dob B. Insured's name C. Insured's identification number D. Date of service (must be within coverage dates).

ERA (Electronic Remittance Advice) balancing and control components to each health plans remittance they include:

A. Payment amount B. Information on aero payments and denied amounts C. Partial payments. D. Contractual allowances E. Patient deductible and co- payment responsibilities.

What are the 4 common statutory liens?

A. The employee's lien B. The landlord's lien C. The materialman's and mechanic's liens D. The tax lien

Identify the factors considered in self-pay follow-up and account resolution

A. Poverty guidelines 1. In absence of state-specific regulations & guidelines, many hospitals use the Federal Income Poverty Guidelines as a mechanism for assigning accounts to a financial assistance status. Poverty Guidelines are issued by the Department of Health and Human Services (HHS) & are used for Medicaid eligibility. a. HHS defines income as money wages and salaries, net receipts from self-employment, regular payments from social security, unemployment compensation, workers' comp, vet payments, public assistance, and alimony & child support. B. Financial profile 1. Some hospitals design guidelines that fit the needs of their community and the mission of their hospital. From this, hospitals develop & employ a patient financial application form to determine a patient's income, assets, and expenses. C. Writing off an account 1. Before writing off an account to bad debt, hospitals should be certain that all third-party payments owed were received. Additionally, in the case of residual balance or self-pay accounts, hospitals should document that appropriate collection actions were taken. Non profit hospitals must comply with all 501(r) billing, time frames and other regulations related to extraordinary collection activities. D. Deemed financial assistance eligible 1. The patient must provide the appropriate information and, in certain situation, documentation to support the need for financial assistance. This documentation is used to substantiate income. Typical required documentation includes: a. Prior year tax return b. Employment check stubs from the prior three months c. Bank statements from the prior three months 2. The patient/guarantor should also be required to complete a written application for financial assistance and answer specific questions related to their dependents in the household and household income. E. Presumptive financial assistance determination 1. Provider may include a presumptive financial assistance option in their financial assistance policy. The policy should specify the allowable other evidence or eligibility or applicant attestation requirements needed to qualify under this provision. F. Catastrophic financial assistance accounts 1. If patients would not normally qualify for financial assistance under the providers' charity care guideline, but they incur excessive charges for a catastrophic illness or injury, then they may qualify for catastrophic financial assistance providing that a catastrophic financial assistance category is included in the hospital's board approved financial assistance policy. a. Catastrophic income - Process involves reviewing the patients income status, calculating their annual disposable income (income remaining after all necessary living expenses), and determining how much of the account balance they can pay, and how much should be written off to catastrophic financial assistance. Typically, the patient payment portion would not extend beyond what he/she can pay over a two year period. G. Medicare bad debt accounts 1. If a patient has not ben approved for financial assistance, the self-pay balances are due and payable. 2. To remain within Medicare guidelines, all self pay portions are pursued for 120 days, after which they are referred to an outside agency for collection. All referrals should be reviewed for compliance as appropriate with the 501(r) regulations. 3. Current Medicare regulations provide bad debt reimbursement to hospitals to compensate for uncollected Medicare beneficiary self-pay balances. However, the Middle Class Tax Relief and Job Creation Act of 2012 reduced the Medicare bad debt reimbursement beginning in 2013 and will continue to transition to a lower reimbursement rate over time. H. Uninsured and underinsured 1. Implementation of ACA and in those states where Medicaid was expanded, the number of uninsured Americans has been reduced. 2. Most hospitals now offer rather extensive discounts based on income. In addition, many hospitals offer prompt pay discounts to those e patients who do not qualify for the discounts due to higher income, but who also do not have health insurance coverage. I. FAP requirements 1. The ACA requires the IRS to issue rules to implement the FAP (Financial Assistance Policy) sections of the ACA. These regulations are known as the IRS 501(r) rules, and apply only to non-profit providers as designated by section 501(c)3 status.

Evaluating a Collection Agency

A. Reputation 1. Agency should be able to provide 3 to 5 references from other healthcare providers is the same, similar or surrounding community area, 2. Ideal collection agencies will have individuals on staff, preferable even at the manager level, who have documented experience working in the financial areas of a medical group, hospital, or other healthcare provider. B. Patient Relations 1. Medical collections is an emotionally sensitive issue that deals with people during or after illness or death. The ability to sensitively deal with patients or individuals while managing collections efficiency is a challenge that requires training and experience. 2. The recording of all telephone calls should be a standard part of the collection agency's toolkit: electronic files of all collection calls must be made available when a patient complaint is made to the provider. C. Agency Fees 1. The net dollars recovered from an agency's collection efforts (bad debt recovery) is the total cash collected by the agency less the collection agency's fees. 2. Percentage fees or agency fees are usually a percentage of the actual dollars recovered with the condition of "no recovery, no fee". 3. Small Court Claims - If the agency is authorized to initiate legal action, particularly small court claims, it may sometimes (but not always) be appropriates to bill the cost of filing as a separate pass-through expense to the provider. In addition, agency fees and the return of all accounts in the event of a contract cancellation should be clearly defined in the contract with the collection agency. D. Retention and payment of agency fees 1. The agency should specify how monies will be handled that are sent to the agency. It is standard practice for the agency to accumulate the payments received in a holding trust account and make monthly disbursements of all funds received during that month to the provider. 2. The monthly payment to the provider may be offset by the commissions earned for collections. A detailed report specifying the accounts paid and the commissions held should accompany the fees. E. Reports 1. The collection agency should submit a minimum of 2 reports to the provider regarding accounts assigned. A report of accounts assigned should be sent to the provider either each time accounts are transferred to agency responsibility or monthly. 2. 2 Reports a. Assignment Report - This report establishes that the account is now the responsibility of, and has been legally assigned to, the collection agency. Should include the date account assigned, patient's name, amount assigned, and other information as requested by the agency. For the provider, this report should serve as the authorizing form for accounts to be written out of the active accounts receivable and transferred into a bad debt or agency holding account. Recoveries from bad debts will be posted to the same account as an offsetting entry. b. Monthly Collections Report - This report provides an account status by listing all accounts for which the agency is currently responsible, the current balance of the account, the original assigned account balance, the date on which it was assigned, and collection comments as available. Over time, an average return on placements can be calculated using the data within this report. If only one agency is used, the total balance amount on that report will be the total amount of bad debts assigned to collection agencies. i. The second report that should be sent by the agency to the provider is a monthly collections report.. It provides an account status by listing all accounts for which the agency is currently responsible, the current balance of the account, the original assigned account balance, the date on which it was assigned, and collection comments as available. F. Collection Results 1. Understanding how to correctly calculate the recovery percentage rate is important to the Patient Financial Services (PFS) director & Chief Financial Officer (CFO), as there are variations in calculating. 2. Most common reporting is dollars recovered (collected) against dollars assigned (placed). Agencies will report this data monthly, quarterly, annually, and over the life of the placement. Some agencies will calculate the rate of recovery as a gross figure using total dollars assigned and total dollars recovered. Others will make the percentage appear better by subtracting dollar balances on accounts transferred back to the provider as uncollectable from total dollars assigned. 3. Uncollectable - When accounts are reported as uncollectable and are returned to the provider by the collection agency, the provider's policies should be followed to ensue that the bad debt expense and allowance for uncollectable accounts correctly reflect the status of these returned account. Medicare account that are reported as uncollectable must be returned to the hospital on the same schedule and handled in the exact same manner as all other accounts. In addition, the collection agency should prepare a "Medicare Bad Debt Log" that contains information needed for the provider's cost reporting activities.

ACA Legislation (only apply to designated group of hospitals)

ACA legislation lays out requirements for : A. Community health needs assessments B. Policies related to financial assistance C. Emergency medical care D. Billing and collection activities These regulations must be met by all hospitals legally designated as non-profit under the IRS code 501(c)3 regulations.

Medicare beneficiaries, physicians, and suppliers have extensive rights to ?

Appeal individual coverage determinations made by Medicare fee-for-service claims processing contractors or Medicare Advantage health plans.

Which option is NOT a type of denial? A. Clinical B. Contractual adjustment C. Underpayment D. Technical

B. Contractual adjustment

Which option is NOT a required component of a FAP? A. Application process B. Out-of-network providers C. Eligibility criteria D. Application assistance

B. Out-of-network providers

Which statement is NOT true regarding credit balances? A. A small credit policy should be matched by a similar policy for small debit balances. B. There are no CMS hospital compliance requirements regarding credit balances C. Hospital generated statements should be sent to patients regarding small credit balances. D. Tracking reports should be developed to identify internal charge credits versus external charge credits.

B. There are no CMS hospital compliance requirements regarding credit balances

Fraud

Cash handling opens the potential for fraudulent activities and therefore it is imperative to implement controls against these attempts.

Federal collection and reporting regulations:

Consumer Credit Protection Act Fair Debt Collection Practices Act Telephone Consumer Protection Act

Which option is NOT a lien type? A. Agreement (Consensus) B. Statutory C. Judicial D. Subrogation

D. Subrogation - not a lien type but instead a process used to pursue payment.

Recognize the general concepts of electronic funds transfer (EFT)

EFT is the electronic transfer of funds from payer to payee through the banking system. It is considered the fastest way to move money because it is possible to transfer funds between banks on the same day. EFT Balancing & Control - EFT simplifies cash balancing & control requirements since the cash is deposited directly into the healthcare provider's bank account. 1. Bank informs healthcare provider of the amount received and issues a deposit. 2. Healthcare provider balances this deposit to the electronic remittance advice (ERA) received.

Define Appeal

In healthcare accounting, denotes a request from a physician or clerical worker in a health care facility for a third-party payer to reconsider a decision about a disallowed claim for compensation. Definition is from the Medical Dictionary for the Health Professions and Nursing

Consumer Financial Protection Bureau (CFPB)

Independent agency of the US Government responsible for consumer protection in the financial sector. Its jurisdiction includes banks, credit unions, securities firms, payday lenders, mortgage-servicing operations,, foreclosure relief services, debt collectors, and other financial companies operating in the US. The CFPB's creation was authorized by the Dodd-Frank Wall Street reform and Consumer Protection Act. The CFPB issues reviews related to activity under the Fair Debt Collection Practices Act. It has also been instrumental in persuading lenders to reduce the impact of medical debt on patient's FICO scores.

Denial Management - Appeals: Assignment on a claim

Part A - Providers can appeal based only on medical necessity Part B Physicians and suppliers have the same right to appeal as beneficiaries if they accept "assignment" on a claim. Accepting assignment means that physicians and suppliers accept what Medicare pays as payment in full without billing the beneficiary for more than the allowed co-payment (and deductible).

Practices that eliminate rejections and denials.

Pre-Service A. Gather complete and accurate demographic and insurance data. B. Complete insurance verification for all insurances listed on account C. Understand health plan requirements D. Complete medical necessity screening E. Obtain all required authorizations F. Communicate to the involved staff. Time-of-Service A. Provide only ordered services B. Closely monitor patient services and verify that all services ordered and provided are clearly documented C. Code accurately based on documentation D. Communicate to the involved staff. Post-Service A. Complete pre-bill edit processing B. Categorize and analyze denied payments to prevent future denials C. Monitor denial activity and final appeal outcomes D, Communicate to the involved staff.

Working with a Collection Agency

Providers should transfer accounts to their individual third party collection agency on a regular basis, at least weekly or monthly. Staff working with the collection agency should adhere to a firm set of policies and procedures about how and when an account is assigned, information to be provided to the agency, how an account is received as uncollectable from the agency, and how public relations and patient complaint calls are to be handled by the Patient Accounts staff.

How to manage denials

Reports are an essential tool used to effectively manage denials. Recorded on these reports are information such as: 1. Denial Type 2. Origination of denial (source) 3. Denial frequency The reports are used to analyze each denial reason and make process changes to eliminate future denials. These reports are also used to track and document appeals and appeal overturns, along with eventual collections.

Processing General Ledger Cash (payments for miscellaneous purchases)

Requires the same separation of duties when processing patient payments. A. Each payment should be logged within the department, payments should be secured and receipts should be issued. B. Receipts should be grouped or batched by payment type and totals and balanced to the receipt log. C. Payments should be totaled and documented. D. Payments are delivered to a cashier, who re-totals the payments and validates that the totals agree. E. The cashier then completes a bank deposit slip.

Chapter 7: Straight Bankruptcy

Straight bankruptcy is a court proceeding that liquidates the debtor's nonexempt property, pays creditors, and discharges the debtor from his/her debt (not exempted from discharge). Nearly all straight bankruptcies are voluntarily initiated by the debtor, although creditors can also force a debtor into involuntary bankruptcy. The debtor begins a voluntary straight bankruptcy by filing a petition with the federal district court. Provides a list of creditors, a schedule (or inventory) of assets & liabilities, and a statement of financial affairs. The debtors wealth is irrelevant, as is the amount of his/her liabilities, so long as the debtor has debts. Once the debtor has filed the petition, he/she is automatically declared bankrupt (called an "order of relief" under the law), the creditors file their proofs of claims, and the first creditors meeting is called. At the first meeting, the creditors question the bankrupt and elect a trustee to act as their representative. Exempt property - The trustee in a bankruptcy has a duty to sell the property of the bankrupt debtor in order to be able to distribute the money to the bankrupt's creditors. The US Bankruptcy Code was liberalized in 1994.The following property is exempt: 1. Any real personal property, including co-op or mobile homes. 2. Disability, illness, or unemployment benefits; life insurance for person the bankrupts individual depended upon and needed for support; and life insurance policy with loan value, in accrued dividends or interest. 3. Alimony and child support. 4. Employee Retirement Income Security Act (ERISA) - qualified pensions needed for support. 5. Personal property: Animals, crops, clothing, appliances, books, furnishings, household goods, musical instruments. Health aids, jewelry, motor vehicle. 6. Public benefits - crime victims' compensation, public assistance, social security, unemployment compensation, VA benefits. Tools of trade - implements, books, and tools of trade. Wages. The type and amount of bankruptcy exemptions vary from state to state. At every 3-year interval ending on April 1, having begun on April 1, 1988, these amounts are adjusted to reflect changes in the Consumer Price Index. 9 Exceptions to Discharge - There are 9 types of debt that cannot be resolved by declaring bankruptcy. 1. Back taxes 2. Debts that arise from obtaining money under false pretenses or false representation 3. Debts that are not properly listed 4. Debts resulting from the bankrupt's misconduct (fraud, embezzlement, or larceny) 5. Unpaid alimony, maintenance, or child support 6. Debts for personal injury caused by the operation of a motor vehicle while intoxicated 7. Government fines or penalties 8. Educational loans due within the proceeding 5 years 9. Debts that could have been listed in a previous bankruptcy proceeding or for which discharge was waived in a previous bankruptcy proceeding.

Work flow (Payment Cycle)

The clean claim payment cycle should be determined for all major health plans and if timely payments are not received (e.g., Medicare pays clean claims within 14 days), a real-time electronic work list should be queued to initiate immediate follow-up.

Bankruptcy

The legal process by which a person, business or corporation is declared to be insolvent and unable to pay creditors. When an individual files for bankruptcy protection the court issues a legal notification to the creditor (provider) indicating the Chapter under which the filing has been processed. Typically, the court will order the creditor to cease additional collection activities and indicate what actions the creditor must not take to establish a claim with the court. The types of bankruptcy and their impact on the patient's financial responsibility to the provider are governed by the 1979 Bankruptcy Act. It is important that all bankruptcy accounts are promptly identified and moved into a separate classification for tracking. Collection agencies should also be notified to cease activity on any accounts for the patient which are in their possession. Failure to take the appropriate precautions to identify and isolate the debtor's accounts from further collection activity could result in a violation of the court's order.

Patient information must

The patient's information must be maintained in a confidential manner.

Community health needs assessment

The purpose of the needs assessment is to identify significant health needs, prioritize those needs and identify resources available to address them. The Community Health Needs Assessment report must be widely available to the community and include an implementation strategy applicable to the identified health needs. NOTE: The balance of the Section 501(r) regulations is specific to the revenue cycle operations.

Choice and Use of Collection Agencies

There is an understandable and natural reluctance on the part of providers to involve a third party collection agency between themselves and the patient. The simple reality is, however, that some accounts will only be collected with the influence and tools of a collection agency.

Identify the 4 major titles of the Consumer Credit Protection Act that deal with the granting of credit

Title I - Truth in Lending Act Title III - Restrictions on Garnishment Title VI - Fair Credit Reporting Act Title VIII - Fair Debt Collection Practices Act (FDCPA)

What are the components in the Consumer Credit Protection Act

Title I - Truth in Lending Act Title III - Restrictions on Garnishment Title VI - Fair Credit Reporting Act Title VIII - Fair Debt Collection Practices Act (FDCPA)

What are the critical keys to maintaining cash flow within a healthcare organization, regardless of provider type.

Using the correct billing form, UB-04 or CMS 1500, preparing the form using verified, accurate data and promptly resolving any edit or claim failures.

Daily Reconciliation Process steps

1. Obtain totals of all payments-cash, check, credit card, debit card. 2. Divide remittances into batches & obtain a second total of the electronic remittance advices by payment and contractual allowances. 3. Endorse checks immediately 4. Prepare the bank deposit for all payments 5. Separate cash payments and contractual adjustments into separate batches and use separate payment and adjustment codes. 6. Post unidentified payments to an unidentified cash account (deposit everything, do not hold unidentified payments). 7. Balance and post batches 8. Balance payments to the bank deposit 9. Balance the bank deposit to the general ledger.

Title III - Restrictions on Garnishment

A garnishment is a legal proceeding whereby money or property due or belonging to a debtor but in the possession of another is applied to the payment of the debt of the plaintiff. Title III of the Consumer Credit Protection Act establishes maximum limits for wage garnishments, either: A. 25% of a worker's disposable earnings per week, or B. The amount by which a worker's weekly wage exceeds 30 times the federal minimum wage ($7.25/hour x 30 = $218.00), whichever is less. Exceptions apply to garnishment for state or federal taxes or by court order. The act also provides that no employee shall be terminated from employment for reason of the fact that his/her earnings have been subjected to garnishment for any one indebtedness. Some states protect consumers from employment termination based on the fact that they have several garnishments.

What is a denial

A health plan's refusal to pay the claim of a healthcare provider.

Common account resolution procedures and activities specific to lien issues

A lien gives a creditor the right to have his/her claim satisfied from the specific property that is subject to the lien before the property can be used to satisfy the claims of general creditors (other creditors who have no lien or security on the debtor's assets). Liens are treated in several different ways: A. Agreement (consensus) - a creditor can protect his/her security interests (which lasts until the full balance is paid) by filing a financing statement under the Uniform Commercial Code (UCC), usually at the Secretary of State's Office. 1. Finance agreement generally includes the following: a. Names and addresses of the agreeing parties b. A description of the collateral (the property to which the lien attaches) c. Signatures of all agreeing parties 2. When personal property is used as collateral, the agreement is called a security interest 3. When the secured property is real estate, the agreement is called a mortgage. B. Judicial - A judicial lien from a creditor's efforts to collect a debt using reasonable "pressuring" techniques (which are regulated by the Fair Debt Collection Practices Act), the creditor must resort to legally prescribed collection procedures. There ae 3 collector remedies. 1.Remedies for judgement: Pre judgement remedies are designed to prevent a debtor from disposing of his/her property or from concealing or destroying it so that it cannot be used to pay off the debt. Garnishment is an example of a pre-judgement remedy. 2. The judgement itself: Courtroom judgements against the debtor give a creditor the position of priority over the creditors whose claims arise after the judgement. 3. Post-judgement remedies: Once a creditor obtains a valid judgement, he/she can collect the money through either execution or after0judgement garnishment. In an execution, the sheriff's directed to sell the property at a public auction. In an after judgement garnishment, the court issues a judgement against the debtor for the property or earnings. C. Statute: Statutory liens are defined in specific laws which allow a creditor to secure a specified asset owned by the debtor. The specified asset may be converted into cash by the creditor to resolve the outstanding debt. **There are four common statutory liens: 1. The employee's lien is placed on the employer's personal property to secure payment of back wages. 2. The landlord's lien is placed on the tenant's property to secure payment of back rent. 3. The materialman's and mechanic's liens are placed to secure compensation of contractors, suppliers, or repair workers. 4. A tax lien is a statutory lien, existing in favor of the state or municipality, upon the lands of a person charged with taxes, binding the same either for the taxes assessed upon the specific tract of land or (in some jurisdictions) for all the taxes due from the individual, and which may be foreclosed for nonpayment, by judgement of a court and sale of the property.

Identify the requirements of the 501(r) regulation (Revenue Cycle Impact)

A. Because these regulations focus on identifying potentially eligible patients and providing financial assistance to those individuals, providers must pursue financial conversations with patient at the earlies possible opportunity, either during the scheduling/pre-registration contact or no later than at time of service. By following the financial communication best practices , the risk of failing to appropriately identify a FAP-eligible patient will be reduced. B. For staff managing patient account post-service, understanding the importance of promptly and accurately processing an application for financial assistance helps expedite the application and resolution process. Further, putting in place controls to ensure that FAP-eligible individuals are not billed gross charges nor subjected to ECAs without proper notice and statement cycles is essential to ensure compliance with the regulations.

Identify the types of denial appeals

A. Beneficiary - any individual (enrolled in Medicare) dissatisfied with the governments claim determination is entitled to reconsideration of the decision, a hearing and a judicial review of the final decision after hearing. 1. If the dispute is over whether services provided under the hospital insurance program are covered by Medicare or about the amount Medicare says it will pay for those services, the individual is entitled to a reconsideration of the decision and to a hearing at a Social Security District Office. 2. A full evidentiary hearing is not available unless the amount in controversy is $130 or more. 3. Judicial review is not available unless the amount in controversy is $1,260 or more. 4. The notice informing the beneficiary of Medicare's coverage and payment determination will explain the basis for the determination and also inform the beneficiary what he/she must do to asks for a reconsidered determination. B. Provider - 1. Section 1878 of the Social Security Act and its implementing regulations give a provider of services and other entities, such as health maintenance organizations (HMO), the right to request a hearing on disputed cost reports submitted to its Medicare Administrative Contractor (MAC). When the amount in controversy is $1,000 or more, but less than $10,000, a dissatisfied provider or other entity may request a hearing. 2. If a provider disagrees with the hearing officer's interpretation of the Act, regulations, ruling, or general instruction used to determine the decision, the provider may request a review of the decision by a special review officer from the Centers for Medicare and Medicaid Services (CMS). Once the CMS special review officer's decision has been established, further appeals concerning the Social Security Act, regulations, general instruction may not be pursued. a. Greater than $10,000 - Any provider of services that has filed a timely cost report may appeal an adverse final decision received from the MAC. This appeal may be filed with the Provider Reimbursement Review Board if the amount at issue is $10,000 or more. The appeals process is a large component of claims denial management. The provider's Patient Accounts department needs to be able to identify denials that should be appealed. They then must identify what is needed to appeal for a reversal of the denial decision.

The Advantages of a Collection Agency

A. Collection agencies have tools and technologies that are effective in pursuing aged self-pay accounts. B. Collection agencies may collect appropriately assigned accounts faster than the provider. C. Collection agencies can establish a complete documentation record that may be critical in litigation activities. D. Collection agencies can provide additional benefits to the patient accounts staff through feedback on evaluation of assigned accounts and staff training. E. The assignment of accounts to an agency can provide an incentive to patients to pay accounts timely to the provider and avoid agency transfer.

Electronic Remittance Advice (ERA) balancing and control

A. Download the ERA electronic files. B. Rereview payment amount with EFT payment amount. C. Process against system filters to identify items that require manual review. 1. Posted contractual adjustment does not match actual health plan contractual adjustment 2. Takebacks 3. Denials 4. Zero or less than expected payments 5. Held claims.

Match the credit balance reason to the appropriate resolution. A. Duplicate Payments B. Late charge credits processing C. Primary and secondary payers both paying as primary D. Inaccurate upfront collections

A. Duplicate Payment 1. Notify payer, send refund or complete take back form as directed B. Late charge credit processing 1. Submit corrected claim to payer or remove credit charges from patient's account C. Primary and secondary payers both paying as primary 1. Determine correct primary, notify incorrect payer of overpayment D. Inaccurate upfront collections 1. Determine overpayment amount, issue refund check to patient.

Identify the root causes and origins of credit balances in accounts receivable.

A. Incorrectly posted allowances or incorrect payment estimates. Reason - Usually this occurs when there is a payer with multiple health plans and a patient was registered with the incorrect plan type. Resolution - 1. Compare the reimbursement rates in the contract with any contractual adjustment posted at the time of billing and the contractual allowance amount on the remittance advice. 2. Identify which contractual is correct a. If the remittance advice contractual is correct, adjust the contractual posted at the time of billing. b. If the contractual adjustment posted at time of billing is correct, contact the payer for payment correction. Ensure the patient account reflects the correct adjustment amount and bill any remaining patient liability. B. Late charge credit processed after a claim is billed. Reason - Commonly originates from service department s that do not process charges within their organization's suspense days. Resolution - 1. Based on payer reimbursement policies, submit the corrected claim to the payer incorporating credits, or post a late charge adjustment to the patient's account. C. Duplicate payments Reason - Most commonly happens when providers re-bill claims based on nonpayment from the initial bill submission. Resolution - 1. Notify payer of duplicate payment. Either send a refund or complete a takeback form as directed by the payer. a. If patient overpaid, return the overpayment to the patient. D. Inaccurate upfront collections based on incorrect liability estimates. Reason - A result of the estimation process that must be used prior to service. This usually results when there are other healthcare claims in process and the anticipated deductibles and co-insurance amounts still show open but will be meet by the in-process claims. Resolution - 1. Review account to determine amount of patient's overpayment. 2. Issue refund check to patient for overpayment. a. If patient has other outstanding patient liabilities, the overpayment can be transferred to settle a confirmed liability on another account. E. Primary and secondary payers both paying as primary Reason - This issue could occur when the payer's coordination of benefits is not captured correctly at the time of patient registration. Another possibility could occur when the secondary payer is not aware there is other coverage. Resolution - 1. If there are primary payments for 2 insurers, determine correct primary and notify incorrect payer of overpayment. 2. Return the check or complete takeback paperwork as requested by payer. 3. Re-bill second payer as secondary for remaining balance.

What is covered in a waiver of liability

A. Provision knowledge - If the Medicare beneficiary had knowledge or should have had knowledge that the services billed for were not covered, the beneficiary is liable for paying for the services. If neither the beneficiary not the hospital knew or reasonable could have been expected to know that the services were not covered, Medicare is liable for paying the claim. B. Provision liability - If the provider should have known and the beneficiary is protected from liability, then liability falls with the provider, and the hospital cannot bill the beneficiary for services other than deductible and co-insurance amounts, even though no Medicare payment has been made. Beneficiaries who do not know that services were non-covered are protected from liability when the services are not reasonable and/or necessary (including adverse level of care determinations) and when custodial care is involved.

Medicare fee-for-service appeals process for both beneficiaries and providers

A. Redetermination by the company that handles claims for Medicare B. Reconsideration by a qualified independent contractor (QIC) C. Hearing before an administrative law judge (ALJ) D. Review by the Medicare appeals council (Appeals Council) E. Judicial review by a federal district court These appeal rights also provide multiple appeal levels, including appeals to Social Security Administration and Administrative Law Judges Medicare beneficiaries can appeal virtually any issue regarding provision or payment of services, and beneficiaries are regularly reminded of their appeal rights. National Policy - Where there is no National Policy, beneficiaries and providers may appeal to the local claims processing contractor. Where there is National Policy, beneficiaries and providers may appeal how contractors and health plans apply that policy to their individual cases.

Identify internal controls for cash handling

A. The separation of cash handling procedures whereby the same person who opens and endorses the checks is not responsible for the deposit B. The establishment of internal audits by personnel outside the involved department. C. The routine use of outside auditors to track cash flow D. The routine reconciliation of daily cash against deposits, postings, and write-offs E. The use of multiple levels of authorization for refund checks, write-offs, and disbursements

What impact payment turnaround techniques are used for third-party payers?

A. Use electronic claims submission B. Send hard copy claims via overnight mail or same day courier C. Send high-dollar hard copy claims via registered mail when required attachments until the electronic attachment standard is implemented. D. Closely monitor payment timeliness and backlogs of major health plans.

Recovery Audit Contractors (RAC) Process

A. When RAC's identify improper payments, they notify the claims processing contractor of the applicable claims. B. The claims processing contractor then adjusts the claims to reflect the proper payment amounts. C. If the improper payment is an overpayment, the claims processing contractor sends a demand letter to the provider to recover the improper payment.

Liability payers

A. Workers' Comp B. Automobile medial insurance coverage C. Premises medical coverage for property cases

Recognize liability payers and lien types used to secure payment of a debt or action

A. Workers' Compensation 1. Responsible for work-related accidents and injury 2. Primary responsibility for all covered work-related services NOTE: Medicare will not pay as secondary for covered work-related services. B. Automobile medical insurance 1. Responsible for healthcare services that result from an auto accident. 2. Most health plans will pay as secondary after auto medical benefits are exhausted. C. Premises medical coverage 1. Covers accidents that happen on a business or individual's property and covers visitors, employees, and animals. 2. Residents are not covered but instead are generally covered by their health plan.

Medical Account Resolution

After a service is rendered, some account resolution activities are applied to all patient accounts with outstanding balances. Other account resolution activities begin only after the account is determined to be at risk for becoming bad debt (amount not recoverable from a patient following exhaustion of all collection efforts). Successful account resolution begins with educating patients on their estimated financial responsibilities, available payment options and financial assistance programs. Patients should also be provided with information about what to expect throughout the account resolution process. Providers should really take responsibility for educating patients on their options and responsibilities and also be proactive about communicating financial assistance policies and procedures.

Compliance with ACA

Compliance with Section 501(r) requirements legally designated as non-profit under the IRS code 501(c)3 regulations is required in exchange for the federal tax exemption. These requirements are a cost of doing business. Compliance allows hospitals to demonstrate how much community benefit services are provided in their communities. Final regulations under Section 501(r) apply to tax years after 12/29/2015. Compliance with Section 501(r) requirements is required in exchange for the federal tax exemption.

Why do credit balances occur? Should they be identified and resolved?

Credit balances occur in accounts receivable when payments and contractual adjustments posted to an account exceed the overall total charges. Credit balances should be identified and resolved to prevent the healthcare organization's accounts receivable amount from being understated.

Based on what you have just read, which option doe NOT have to be considered when initiating self-pay follow-up and account resolutions activities? A. Poverty Guidelines B. Presumptive Financial Assistance Determination C. Financial Profile D. Patient Open Balance Billing

D. Patient Open Balance Billing

Chapter 13: Debtor Rehabilitation

Debtor rehabilitation is a court proceeding that does not liquidate property nor discharge debts. Rather, debtor rehabilitation serves to reorganize a debtor's holding and instruct creditors to look to the debtor's future earning for payment. Garnishment is a form of debtor rehabilitation.

Impact of denial on Patient-Centric Revenue Cycle

Denials have a significant impact on the revenue cycle. The most obvious impact is lost reimbursements and increased collection fees. Productivity is impacted as well when staff must: A. Repeat a process to make corrections B. Set aside time to research the reason for the denial. V. Make phone calls or pull documentation to initiate an appeal.

Extraordinary collections actions (ECAs)

ECA's may not be pursued until after the hospital has taken reasonable efforts to determine the patient's eligibility for financial assistance. This section applies to hospital as well as other entities, such as collection agencies, working on behalf of the hospital. There are 4 types of actions categorized as ECAs: 1. Legal actions, such as garnishments, liens, or other actions requiring legal or judicial processes. 2. Selling the debt to a third party 3. Reporting adverse information to credit bureaus or agencies 4. Deferring or denying (or require a payment before providing) medically necessary care because of nonpayment for previously provided care that is covered by the FAP.

Financial assistance policy (FAP)

Each hospital is required to establish a written FAP that applied to all emergency and medically necessary care. The policy must be approved by the hospital's board of directors. FAP must contain 9 key elements: 1. Eligibility criteria which must be met for each type and level of financial assistance, including all available discounts and free care. 2. Whether and how the hospital used information from sources other than the applicant to grant eligibility on a presumptive basis. 3. How an individual actually applies for financial assistance, including documentation requirements. 4. Where an individual can obtain assistance with completing the application. 5. A listing of all providers, specifying who is covered by the FAP and who is not 6. The notice that individual eligible for financial assistance under this policy will not be charged more than the amount generally billed (AGB) to insured patients. 7. A prohibition on billing FAP-eligible individual's gross charges; the AGB applies only to the amount for which the patient is responsible. NOTE: this provision means that a hospital may, when an insurer is involved with a FAP-eligible individual, collect more than AGB, as the AGB limitation only applies to the patient's portion of the bill. 8. Identification of the methodology used to determine the amount generally billed (AGB), which is either the "look back" method or the "prospective Medicare/Medicaid" method. a. "Look back" method - involves dividing 12 months of allowed claim amounts by the corresponding gross charges. Providers may use Medicare or Medicaid fee for service claims only, or may use Medicare or Medicaid in combination with all private health insurers. The result is the maximum percentage of gross charges that a FAP-eligible patient may be charged. b. "Prospective Medicare/Medicaid" method, providers use Medicare or Medicaid fee for service billing and coding rules to determine the amount a FAP-eligible patient would pay based on the amount that Medicare or Medicaid and a corresponding beneficiary would be required to pay for the same service. 9. What actions the hospital may take in the case of nonpayment.

Categorize the different levels of automation used in electronic remittance advice posting

Electronic Remittance Advice (ERA) 835 Data Set - A standardized healthcare claim payment remittance advice known as the 835 format is used to electronically send third-party payment details to healthcare providers. There are 4 levels of automation that can be used. A. Level 1 - electronic receipt of data only. a. Electronic remittance advice is received b. The information is printed c. The printout is then processed the same as a paper remittance advice. d. Advantages include: 1. Saving mail time for remittance 2. Standardized format for data entry B. Level 2 - electronic receipt & electronic data entry: a. With this level, the electronic remittance is received b. Entered into the computer electronically. c. Viewed on a terminal 1. Data entry tasks are eliminated through automated entry of the information, but usually there continues to be a manual matching of remittance information to an individual account and reconciliation of charges submitted to the amount paid. C. Level 3 - electronic receipt, data entry, reconciliation, posting, and closing. a. Electronic remittance advice is received and entered into a computer electronically. b. The remittance data is electronically posted by the patient accounting software, simultaneously updating the patient's account. 1. Standard adjustment codes must be established to automate entries for payments, i.e. contractual allowances and other write-offs. Manual intervention is only needed if there is a disagreement or an error. D. Level 4 - total automation of receipt, data entry, payment posting, and adjustment processing. a, In addition to everything included at level 3, this level links with banking information to allow reconciliation of payments received electronically through a non-bank network, with funds received electronically. 1. Medicare logs and the secondary billing process are automated using the ERA. An electronic explanation of benefits received from the primary health plan is transmitted electronically with the secondary claims. Manual intervention is only required to handle disagreements.

What is financial assistance policy key elements

Financial Assistance (Charity): Hospital must establish a policy, define the appropriate criteria, and implement procedures for identifying and processing accounts & monitoring compliance. Key Elements: A. Concise statement of the hospital's mission B. Clearly defined financial assistance statement C. Payment requirements (e.g., emergency and urgent services will not be delayed regardless of ability to pay) D. Inpatient and outpatient deposit requirements E. Payment methods F. Installment arrangement guidelines G. Guidelines for bad debt or previous unpaid accounts

Recognize the difference between financial assistance and bad debt

Financial Assistance (Charity): The definition for recognizing the difference between financial assistance and bad debt is often cited as the inability to pay (financial assistance) versus the unwillingness to pay the entire account or the balance of an account not paid by insurance (bad debt).

Denial Management - Appeals: Non-Governmental Claims Denials

For non-government claim denials, providers must follow the appeal conditions specified in the individual health plan contracts. Sometimes these appeal requirements are provided in the contract, but if it isn't clear in the contract, the appeal requirements can be obtained from the health plan that issued the denial. A. Appeals - must be submitted within the time frame outlines in the contract. An appeal to the health plan's chief medical officer may be pursued as an appeal of a final and last resort. B. Patient accounts staff - an obtain the assistance of the beneficiary, if proper authorization is obtained from the patient, to facilitate the appeal process s if the Patient Accounts Staff are experiencing difficulty obtaining a response from the health plan. C. Privacy - In all situations, the patient's information must be maintained in a confidential manner.

Identify resolution processes to small credit balances

For small credit balances under a certain dollar amount, the hospital should send at least one or two statements with the following information: A. Notification that a credit balance exists B. An explanation of how to request a refund. C. Include the healthcare organization's policy to absorb small credits if no request is received within a certain period of time. A small credit policy should be matched by a similar policy for small debit balances. In this manner small debit or credit balances can be cleared within a short period of time (e.g., 45 days). Tracking reports should be developed to identify internally generated charge credits versus externally generated charge credits. These reports should be reviewed with all impacted departments and used as a basis to resolve credit balance issues.

Health plan, liability payer, third party payers, lien, clean claim, electronic worklist

Health plan - Commercial, governmental, or other payer responsible for adjudication and payment of claims for health care services. Liability payer - Has primary responsibility to pay for healthcare services provided due to a liability situation, i.e., workers' comp accident, automobile accident (auto-medical insurance_, or premises accident. Third Party payer - A party, other than the patient/guarantor, that is responsible for paying all or part of a patient's healthcare bill. The first party is the patient or guarantor whom may owe a co-pay, deductible and/or co-insurance amount. The second party is the healthcare provider who delivers the service to the patient. The third party is a health plan or liability payer whom will pay for all or part of the services that are provided to the patient. Lien - Claim against real or personal property that secures payment of a debt or performance of some other act. Clean claim - A claim for reimbursement submitted to a health plan that has all information and documentation required for the health plan to make a decision on payment or denial. Electronic worklist - Some claim processing and accounts receivable computer systems include functionality that identifies claims that remain unpaid a specific number of days from the initial billing date. Unpaid claims that meet this criteria are presented, via the computer software, in an electronic work que or list for staff to review and take the appropriate follow up action.

Why it is important to identify credit balances

If credit balances are not identified separately from debit balances in accounts receivable and these balances are offset against each other (or "netted"), the end result will be the healthcare organizations accounts receivable being understated. There are compliance requirements. CMS requires hospitals to report all Medicare credit -balanced overpayment accounts on a quarterly basis using form CMS-838, which must be signed and attested to by an officer of the hospital specifically, the chief financial officer (CFO) or the chief executive officer (CEO).

Subrogation

If the health plan is billed, the claim must include occurrence and value codes identifying the claim as accident related. The health plan may process the claim for reimbursement and subsequently pursue payment from the liability payer. Medicare - allows providers to submit liability claims after a 120 day waiting period, but the provider must cancel its claim against the liability payer as Medicare will pursue payment.

Shifted liability

If there is a remaining open balance after all insurance payments have been received and posted, any remaining account financial liability is shifted to the patient. An open balance may include a deductible, co-payment, and/or co-insurance balance.

Follow up work flow - open third-party balance (and account resolution)

If timely payments are not received (e.g., Medicare pays clean claims within 14 days), a real-time electronic work list should be queued to initiate immediate follow-up action. Additional follow-up will be queued based on the initial follow-up response. When primary payment is received, the actual reimbursement is compared to the expected reimbursement then the remaining contractual adjustments are posted, and secondary claims are submitted unless there is an automatic cross over provision from the primary payer to the secondary payer. If there are not additional third party payers, a self-pay bill may also be generated.

Effective follow up methods and actions

In addition to utilizing real-time work lists to identify claims that have not been paid within the expected time frame, there are a number of claim follow up tools and techniques that can assist in identifying potential non-paid claims sooner. A. Health Plan Electronic Claim Status: Many larger health plans accept electronic claims directly from the provider or via a clearing house. In addition, they may offer daily claim acceptance and validation real-time feedback so that immediate, same day, action can be taken by staff if a submitted claim is not accepted by the health plan. In addition, the health plan may provide an online portal whereby the provider can track the status of individual claims within its claims processing system. B. Clearinghouse Claim Tracking: If a clearing house is used to submit electronic claims to third-party payers, daily claim transmission files are confirmed and payer acceptance of individual claims is often available via a daily clearinghouse electronic work list or report. The reason the claim was not accepted is also communicated and immediate, same day, action can be taken by staff to resolve the issue. C. Medicare Common Working File (CWF): Is a host of databases that houses all beneficiary claim history and entitlement information. All Part A & B claims for a beneficiary are processed against this single file prior to claims payment. The record is updated daily with data from adjusted and approved claims, including basic reply communications such as : 1. Accepted (as is) for payment 2. Adjusted and then accepted for payment 3. Cancel/Void claim accepted 4. Rejected 5. Not in host's file 6. MSP Maintenance response

Sue Smith came into the hospital. Her insurance provider sent an EFT directly into the hospital's account at the bank. John, the hospital rep, receives ab electronic Level 2 ERA. What should he do next?

Manually match the ERA to the patient account.

Appeals process

Medicare beneficiaries, physicians, and suppliers have extensive rights to appeal individual coverage determinations made by Medicare fee-for-service claims processing contractors or Medicare Advantage health plans. These rights are listed in: Medicare handbook Every explanation of Medical benefits notice Medicare summary notice which is sent to beneficiaries Notices given to patients when they are admitted to hospitals.

Recovery Audit Contractors (RAC)

Mission is to protect Medicare from fraudulent and abusive billing. The RAC's primary responsibility is to identify improper payments for Medicare A & B claims that have been paid by claims processing contractors. May also request and analyze provider claim documentation to ensure that services provided were reasonable and necessary

Identify the components of the Telephone Consumer Protection Act

Most recent TCPA rules are: 1. Consumers will have the right to revoke consent to receive auto-dialed calls and text messages in any reasonable way at any time 2. Callers will be required to cease calling recycled numbers after a single call. 3. The definition of an auto-dialer will be expanded to include equipment with potential future ability to dial random or sequential numbers from a list of numbers.

Credit balances

Occur in patient accounts when payments and contractual adjustments posted to an account exceed the overall total charges. It is important to identify and resolve credit balances in the accounts receivable.

Objective of ACA

One objective of the ACA is to promote the transparency of a hospital's community health needs assessment, Financial Assistance Policy (FAP), and to provide protections to FAP-eligible patients with respect to charges and collection.

How to resolve such credit balances (Resolution process)

One part of the resolution process should be determining the root cause and origin of credit balances and also implementing a policy and procedure to eliminate them. A. The organization should have a revenue policy in place that defines time frames for charge submission. This time frame is typically 3 days after service. If all charges are submitted within this period, late fee transactions are eliminated. B. Payers that regularly generate credit balances should be identified and contacted to see what claim processing steps can be modified to eliminate duplicate payments or claims paid according to the wrong Coordination of Benefits (COB)

Identify the reasons for health plan denials and learn how to address and avoid them

Outpatient - A. Duplicate bills, usually caused by re-bills or late charges, without the proper bill type code. B. Missing authorizations C. Wrong insurance plan code D. Prior approval not obtained for new procedures or drugs E. Care provided in non-covered setting (inpatient vs outpatient) F. Medicare Secondary Payer issues G. Inaccurate demographic or insurance information such as group number. H. Lack of appropriate support documentation required for billing, such as therapy notes. I. Over lapping inpatient and outpatient claims (where outpatient should be rolled into inpatient claim) J. Invalid revenue or HCPCS codes. K. Patient not eligible or services not viewed as medically necessary L. Untimely filing M. Missing physician number. Inpatient - A. Patient was billed as observation but should have been admitted and billed as inpatient. B. Patient was admitted but documentation does not support medical necessity C. Admission notifications not completed within health plan timelines. D. Continued care in an acute setting is not supported by medical record documentation. E. Focused reviews in a specific area that may be related to the use of observation status, or the used of anesthesia, etc... Patient-Centric Cycle - Pre-Service Associated with physicians, patient access, financial counselors, and case management. A. Not ensuring pre-authorizations are obtained for required services. B. Clinical information not called in for certification. C. Insurance benefits not verified D. Incorrect data entry (example - date of birth entered incorrectly) E. Invalid registration information (historical information was not validated with the patient e.g., using old insurance information. Time-of-Service Associated with physicians, patient access, case management, clinical service departments and health information management (HIM) A. New technology used without determining coverage B. Charges bundled or unbundled incorrectly according to health plan rules. C. Patient acuity level changes but type of service not changed. D, Admission notification not completed. E. Patient admitted as inpatient, but should have been observation. F. Test performed that is not on order. G. Patient should have been discharged but was not. H. Patient treated for medical condition while in specialty unit. I. Authorization for additional days not obtained. J. Invalid coding (HCPCS & ICD 10) Post-Service Associated with the clinical service departments, patient access, information technology, and patient accounting. A. Late charges (entered after suspense days) B. Multiple claims sent with dates of service that overlap C. Untimely filling

Common reasons for denials include the following

Outpatient: A. Duplicate bills, usually caused by re-bills or late charges, without the proper bill type code. B. Missing authorizations C. Wrong insurance plan code D. Inaccurate demographic or insurance information or insurance information such as group number. E. Prior approval not obtained for new procedures or drugs F. Care provided in non-covered setting (inpatient versus outpatient) G. Medicare Secondary Payer issues H. Lack of appropriate support documentation required for billing, such as therapy notes I. Overlapping inpatient and outpatient claims (where outpatient should be rolled into an inpatient claim) J. Invalid revenue or HCPCS codes K. Patient not eligible or services not viewed as medically necessary L. Untimely filing M. Missing physician numbers. Inpatient: A. Patient was billed as observation but should have been admitted and billed as inpatient. B. Patient was admitted but documentation does not support medical necessity. C. Admission notification not completed within health plan timelines. D. Continued care in an acute setting is not supported by medical record documentation E. Focused reviews in a specific area that may be related to the use of observation status, or the used of anesthesia, etc..

Chapter 11: Debtor Reorganization

Permits a debtor to work out a court-supervised plan with his/her creditors ("reorganization"), usually in the nature of a composition (reduction in debt), an extension (more time to pay off the debt), or a receivership (involving the continuing management of the debtor's business or property). The debtor declares Chapter 11 by filing a petition in federal district court. Next, the debtor within 120 days, must file a plan stating the terms of the proposed reorganization. The debtor's creditors may either accept or reject the plan. The plan is accepted when there is a majority creditor approval in number and two-thirds in amount of claims. Reorganization - the court "confirms" or accepts the debtor's plan only: 1. If it is satisfied that the proposal is in the best interests of the creditors. 2. That the debtor will faithfully carry out the plan 3. That the plan provides for payment to creditors in the order of priority as described above. 4. And that the creditors have either accepted the plan or that they will receive or retain as much as they would have under a straight bankruptcy proceeding. NOTE: If a plan cannot be confirmed, the court may either convert the case to liquidation under chapter 7, or dismiss the case.

Policies and procedures - Fraud

Policies and procedures should segment responsibilities so that no one individual has the ability to post charges, payments, and write-offs without a balancing control, another activity to document the funds transfer, preferably by a supervisory-level staff member. Large adjustments, including contractual write-offs, bad debt write-offs, and charge transfers, should require a manager-level authorization. While controls may have the effect of slowing the accounts receivable processing, the lack of control can result in the loss of revenue and cash.

Waiver of liability

Refers to a provision established by Medicare to protect beneficiaries and physicians from liability when services are denied as inappropriate or medically unnecessary.

What is waiver of liability

Refers to a provision established by Medicare to protect beneficiaries and physicians from liability when services are denied as inappropriate or medically unnecessary.

Selection of a Collection Agency

Selection is similar to an affiliation with a business partner or the hiring of a vendor for specific services. Specific HIPPA Business Associate agreements should be included within the contract between the collection agency and provider. Keep in mind that this collection agency represent the provider when interacting with patients - this can have a significant impact on patient relations (good or bad)

Telephone Consumer Protection Act (TCPA)

TCPA was intended to restrict auto-dialer calls and automated messages by telemarketers to consumers' cell phones without the specific prior consent of the consumer. However, dialing a patient's number using a standard office telephone that does not use automated dialer technology is not a violation of the act. Likewise, leaving automated messages is not a prohibited use. To be compliant with TCPA, it is critical that the provider implement procedures to obtain the patient's consent to call his/her cell phone number. Unless the patient is informed that the number will be shared with other providers, those ancillary providers do not have the right to use that cell phone number. So, adding TCPA consent provisions to admission forms is critical to ensure that all parties using the contact number have the patient's consent for such use. Failure to obtain proper consent may result in fines from $500 to $1500 per auto-dialer call violation. Most recent TCPA rules are: 1. Consumers will have the right to revoke consent to receive auto-dialed calls and text messages in any reasonable way at any time 2. Callers will be required to cease calling recycled numbers after a single call. 3. The definition of an auto-dialer will be expanded to include equipment with potential future ability to dial random or sequential numbers from a list of numbers. NOTE: The recommended best practice is to obtain express written consent from all patient's to allow use of cell phones from contact from the hospital and any of its related parties and vendors.

Title VIII - Fair Debt Collection Practices Act (FDCPA)

The Fair Debt Collection Practices Act of 1978 applies to third-party collection agencies that collect consumer debt. As long as a hospital collects its own debts using its own name, it is not considered a debt collector under the Act. A. Section 804 1. Governs the actions of debt collectors while attempting to identify an individual's location or rather skip tracing. Because skip tracing requires contact with third parties, this section of the Act is especially strict. The following items are excerpts from this section. 2. Any debt collector communicating with any person other than the consumer for the purpose of acquiring location information about the consumer: a. Shall 1. Identify him/herself, state that he/she is confirming or correcting location information concerning the consumer, and , only if expressly requested, identify his/her employer. 2. After the debt collector knows the consumer is represented by an attorney with regard to that subject debt and has knowledge of or can readily ascertain, such attorney's name and address, not communicate with any person other than that attorney, unless the attorney fails to respond within a reasonable period of tine to communication from the debt collector. b. Shall Not 1. Not state that such consumer owes any debt 2. Not communicate with any such person more than once unless requested to do so by such person or unless the debt collector reasonable believes that the earlier response of such person is erroneous or incomplete and that such person now has correct or complete location information. 3. Not use any language or symbol on any envelope or in the contents of any communication affected by the mails or telegram that indicates that the debt collector is in the debt collection business or that the communication relates to the collection of a debt. 4. Not communicate by postcard. B. Section 805 1. Section 805 covers the most basic functions of a collector communication. For the purpose of this section, the term "consumer" includes the consumer's spouse, parent (if the consumer is a minor), guardian, executor, or administrator. a. Communication with the Consumer Generally - Without the prior consent of the consumer given directly to the debt collector or the express permission from a court of competent jurisdiction, a debt collector may not communicate with a consumer in connection with the collection of any debt: 1. At any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer. In the absence of knowledge of circumstances to the contrary, a debt collector shall assume that the convenient time for communicating with a consumer is after 8 am and before 9 pm in the consumer's local time zone. 2. If the debt collector knows the consumer is represented by an attorney with respect to such debt and has knowledge of, or can readily ascertain, such attorney's name and address, unless the attorney fails to respond with in a reasonable period of time to a communication from the debt collector or unless the attorney consents to direct communication with the consumer. 3. At the consumer's place of employment if the debt collector knows or has reason to know that the consumer's employer prohibits the consumer from receiving such communication. b. Ceasing Communication - If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector shall not communicate further with the consumer with respect to such debt, except: 1. To advise the consumer that the debt collector's further efforts are being terminated. 2. To notify the consumer that the debt collector or creditor may invoke specified remedies, which are ordinarily invoked by such debt collector or creditor. 3. Where applicable, to notify the consumer that the debt collector or creditor intends to invoke a specified remedy. C. Section 806 1. Harassment is defined in Section 806 in terms of the 6 specific practices prohibited. A debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt. Examples of prohibited conduct include: a. The use or threat of use of violence or other criminal means to harm the physical person, reputation, or property of any person. b. The use of obscene or profane language or language the natural consequences of which is to abuse the hearer or reader. c. Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number. D. Section 807 1. Collector conduct violations are defined in Section 807. There are 16 deceptive or false representations that are prohibited in the collection practices. A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section: Among the more significant clauses are: a. The false representation or implication that any individual is an attorney or that any communication is from an attorney. b. The representation or implication that nonpayment of any debt will result in the arrest or imprisonment of any person or the seizure, garnishment, attachment, or sale of any property or wages of any person unless such an action is lawful and the debt collector or creditor intends to take such action. (the threat to take any action that cannot legally be taken or that is not intended to be taken.)

What is EFT?

The electronic transfer of funds from payer to payee through the banking system.

Title I Truth in Lending Act and Regulation Z

Title I of the Consumer Credit Protection Act is called the Truth in Lending Act. It establishes disclosure rules for consumer credit sales and consumer loans. The most important section is Regulation Z, which tells creditors how to comply with the law. Regulation Z's disclosure requirements apply to hospitals if all of the following 5 points are met (if any or several do not apply, no disclosures are required under Regulation Z): 1. A collector enters into a written agreement with a debtor regarding the payment of a debt; and 2. The account relates to credit extended for personal, family, or household purposes; and 3. During the preceding calendar year or in the calendar year to date, the collector has entered into agreements (written or otherwise) with debtors involving the addition of interest or finance charges or written agreements with debtors involving more than 4 installments (whether or not interest is added) more than 25 times; and 4. Payments are to be made in more than 4 installments; or the collector adds interest (if allowed by law) to an account to which interest was not previously charged, or the original interest is increased; and 5. The agreement is not related to the court proceeding (such as a lawsuit). All 5 points of Regulation Z must apply to trigger the disclosure requirements. If any or several do not apply, no disclosures are required under Regulation Z. If the disclosure requirements of Regulation Z are triggered, the information disclosed must include the following: 1. Annual percentage rate 2. Amount of finance charge 3. Amount financed 4. Amount of payments 5. Late payment charges 6. Total0 of all payments 7. Pre-payment arrangements 8. Payment schedule including the number of payments, amount, and timing 9. An opportunity for debtor to receive an itemization of how the payments are to be applied. NOTE: Failure to comply with the disclosure provision may result in fines and restitution payments.

Title VI - Fair Credit Reporting Act

Title VI of the Consumer Credit Protection Act is called the Fair Credit Reporting Act. It affects those who "issue or use reports on consumers in connection with the approval of credit." This act protects consumers' rights and has exact standards that limits the use of consumer credit reports. The Fair Credit Reporting Act covers the type of information that must be removed. For example, collection accounts must be removed after 7 years. The Fair Credit Reporting Act also prescribes the Procedures in Case of Disputed Accuracy as follows: A. Upon dispute of accuracy of information on file, the agency will reinvestigate and revise information. B. If reinvestigation doesn't clear the dispute, the consumer may place on file a brief summary of dispute. C. Disputed information will be reported as such, in any subsequent disclosures on the consumer's file. D. Upon deletion of legitimately disputed information, the agency shall, at the request of the consumer, re-disclose to anyone receiving a report regarding the consumer in prior 2 years for employment purposes, the fact that the information has been deleted or revised. NOTE: The agency must clearly and conspicuously disclose to the consumer his/her right to make such a request.