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Management of Health Insurance Claims - JSteele

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					Management of Health
Insurance Claims
  Jeff Steele, LDO, ABOC, CPOT
  Spokane Community College
Objective
 l   Describe the management of health insurance
     claims
 l   Know methods of payment for care provided
     under health insurance plans
 l   List and know limitations which influence how
     much the carrier will pay and how much the
     patient must pay
 l   State how patient and carrier information
     should be gathered and organized
 l   Complete a claim form
Overview

 l   Health insurance is designed to reduce the
     patient’s share of the cost of medical care
 l   In most cases, the patient is still responsible
     for a share of the payment
 l   As a service to patients, and to facilitate claims
     management within the practice, it is important
     that all claims be completed accurately and
     submitted promptly
Computerized Claims Management

 lA  computerized bookkeeping system
   greatly simplifies and speeds the
   preparation of insurance claims
 l The data necessary for producing the
   claim form is entered into the system as
   part of the account history and during
   posting
Electronic Claims Transmission

 l   To decrease the costs of re-entering data
     submitted in paper form into a computer,
     carriers prefer to have claims submitted
     electronically (the handling of paper claims
     increases the carrier’s cost of doing business
 l   Electronic filing eliminates the need for paper
     claim forms, delays in the mail, and the
     possibility of error when the data is entered
     into the carrier’s computer
Electronic Claims Transmission
 l   During the day, claim information is posted into the
     computer. This completes both insurance and
     bookkeeping records
 l   A copy of the claim may be printed for the office files
 l   At the end of the day, the claims are electronically
     checked for errors
 l   The computer claims are electronically prepared and
     transmitted via a modem
 l   A report indicates which claims were successfully
     transmitted. (Those that were unsuccessful are sent
     with the next batch)
Patient Information
 l   Includes data about family members who are
     entitled to receive benefits under the plan and
     include:
 l   Full name
 l   Sex
 l   Relationship to the insured
 l   Date of birth

 l   This data must be complete and accurate or
     the claim cannot be processed= delay in
     receiving payment
Insured

 l AKA   the “subscriber”
 l The person who represents the family
   unit in relation to the insurance plan
 l The subscriber is usually the employee
   who is earning these benefits
Beneficiaries

 l Someone    entitled to receive benefits
   under the health care plan
 l Usually includes the insured, spouse,
   and children
 l Since not all plans cover family
   members, it is necessary to clarify on the
   patient registration form just which family
   members are covered and which are not
Children

 l For   purposes of eligibility, children are
   usually defined as being under age 18
   and still dependant on their parents
 l Exceptions include when the child is a
   full-time student or handicapped
Plan Information: Terminology
 l   Carrier: an insurance company
 l   Plan: an insurance contract which the carrier
     has written to provide specific benefits to those
     covered by the plan

 l   As the health care provided, it is advisable to
     make sure the patient understands exactly
     what their coverage is by explaining their
     benefits. This may help you to avoid a
     potential collection problem
Methods of Payment

 l There   are many different ways in which
   health care plans pay for the patient’s
   care
 l It is important that you understand how
   these different methods of payment
   influence the amount of payment the
   doctor will receive from the carrier
Fee-For-Service
 l   Doctor is paid as services are rendered:
 l   Schedule of benefits: a list of specific amounts which
     the carrier will pay toward the health care costs (often
     not related in any way to the doctor’s fee schedule.
     The patient is responsible for the difference
 l   Usual and Customary: Usual fee is based on the
     doctors fee schedule, as it relates to other physicians
     in the area. (Carrier usually has a physician fee profile.
     Customary fee is set by the carrier (fees are
     determined as a percentile of usual fees charged by
     physicians with similar training and experience within
     the same geographic area)
HMO
l Health Maintenance Organization (HMO)
l System in which the patient pays a flat monthly premium to
  the HMO and covers all medical services as specified in the
  contract:
l Patient selects a primary care physician and all referrals go
  through that physician
l Capitation plan: doctors are paid a flat fee for each patient
  under the practice’s care, regardless of the amount of care
  provided
l Non-capitation plan: doctors are paid in accordance to the
  number of patient’s seen over a given amount of time

l   In either plan, the patient is often required to make a co-pay
    at each visit
PPO

 l   Preferred Provider Organization (PPO)
 l   A formal agreement among health care
     providers to treat a specific patient population
     at an agreed upon rate
 l   This rate is usually a discounted fee-for-
     service
 l   Patient’s may select their own physician;
     however, they have the incentive to select a
     preferred provider, due to larger cost coverage
IPA
 l   Independent Practice Association (IPA)
 l   A type of HMO, generally formed and run by
     physicians who enter into agreements with
     organizations (usually employers) to provide
     medical services to a defined group of persons
     (employees)
 l   IPA physicians usually practice out of their
     own offices and may IPA physicians continue
     to see their regular patients on a fee-for-
     service basis- while seeing the IPA patients at
     the IPA rate
Medicaid

 l   Government program providing health care to
     the poor
 l   Governed by rules set forth in each state,
     therefore, coverage and eligibility vary from
     state to state
 l   Payment is based on a schedule of benefits
     and the physician must accept the amount
     paid by the carrier as payment in full (the
     patient can NOT be billed for the difference)
Medicare

 l Government    program providing health
   care to the elderly, controlled by the
   federal govt.
 l Patients are responsible for a deductible
   and co-payment share
 l Physician is responsible for submitting
   the Medicare claim
Workers’ Compensation

 l Every state has a workers’
   compensation law that provides
   coverage to employees who are injured
   or become ill during performance of their
   work
 l Regulations vary from state to state
CHAMPUS

 l Civilian  Health and Medical Program of
   the Uniformed Services
 l Program designed to provide eligible
   beneficiaries a supplement to medical
   care in military and Public Health Service
   facilities
 l Beneficiaries include retired members
   and eligible dependents of the armed
   services
Eligibility

  l There  are factors to consider when
    determining a patient’s eligibility in
    receiving benefits.
  l Always contact the carrier if there is any
    doubt, to prevent the patient form
    accumulating a large balance
Deductible

 l The stipulated amount that the covered
   person must pay toward the cost of
   covered medical treatment before the
   benefits of the program go into effect
 l This may be an individual or family
   deductible
Co-Insurance

 l Also  known as co-payment, co-
   insurance is a provision of a program by
   which the beneficiary shares in the cost
   of covered expenses on a percentage
   basis
 l Co-insurance percentages are usually
   listed showing only the portion which the
   carrier will pay.
 l The amount of the patient’s share
   various with each policy
Exclusions

 l Some   policies exclude certain services.
   For example, cosmetic surgery may be
   excluded except when it is a medical
   necessity
 l The patient may still receive treatment,
   but they are responsible for the fee
Maximums

 l   The carrier may establish a maximum as to the
     amount that will be paid for medical benefits
     within a given year, or lifetime
 l   For example: a plan may have a $50,000
     lifetime maximum per patient for in-patient
     psychiatric care. This means that the carrier
     will not pay for any treatment beyond that
     amount even if the treatment is a “covered
     service”
Second Opinion

 l Some  carriers require that patient get a
   second opinion before going ahead with
   procedures such as an elective surgery
 l Should this be required, a copy of the
   second doctor’s consultation should be
   included in the patient’s file
Hospital Pre-certification

 l AKA   pre-authorization
 l An administrative procedure whereby the
   insurance carrier authorizes treatment
   before it is provided
 l Under many plans, this is required
   before certain hospital admissions,
   inpatient or outpatient surgeries and
   elective procedures
 l Emergencies are usually exempt
Pre-certification

 l   If pre-certification is required, call the carrier as
     soon as possible and be prepared with the
     following information:
 l   Patient’s name and ID number
 l   Doctor’s name and ID number
 l   Name of hospital and planned admission date
 l   Patient’s diagnosis and symptoms
 l   Planned treatment and length of stay
Coordination of Benefits (COB)
 l   When a patient has insurance coverage under more than one
     group plan, this is known as dual coverage and it is necessary
     to coordinate the benefits
 l   The patient may not receive payment from both carriers that
     comes to more than 100% of the actual medical expenses
 l   In order to coordinate benefits, it is necessary to determine
     which carrier is primary (should pay first) and which is
     secondary
 l   Submit the claim to the primary carrier. Upon payment, there
     will be a explanation of benefits (EOB)
 l   Send the claim, along with the EOB, to the second carrier
Determining the Primary Carrier

 l   When the patient is
     also insured, the
     patient’s carrier is
     primary and the
     spouse’s carrier is
     secondary
The Birthday Rule

 l When   the children come in, the primary
   coverage is often determined by the
   birthday rule
 l The carrier for the parent who has a
   birthday earlier in the year is primary (it
   has nothing to do with which parent is
   older)
Claim Steps
 l   Before the patient’s first visit, ask about insurance. If
     the patient is covered, be sure they bring that
     information with them
 l   At the first visit, verify coverage and photocopy the
     card for the patient’s record. Inform the patient of any
     deductible and of details of coverage that are pertinent
     to their visit
 l   At the end of the patient’s visit, all charges are entered
     into the patient’s account history. The patient may be
     asked to pay for any balances at this time. (Some
     offices may wait until the insurance has paid before
     asking for the balance)
File the Claim

 l Allclaims must be neat, complete and
   easy to read
 l They should be completed in duplicate,
   or photocopied, so that one copy goes to
   the carrier and the other remains with
   the office
Follow-up

 l Unpaid   insurance claims represent
   money owed to the practice, and it is
   necessary to follow up on them
 l Unpaid claims should not be filed away
   in the patient’s chart, as it may get
   overlooked
 l If the claim is not paid within 30 days,
   the carrier should be contacted to
   determine if there is a problem

				
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