Chapter 9 Receiving Payments and Insurance Problem Solving Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Receiving Payments & Claim Processing Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Learning Objectives Identify three health insurance payment policy provisions. Interpret and post a patient’s explanation of benefits document. Indicate time limits for receiving payment for manually versus electronically submitted claims. Name three claim management techniques. Identify purposes of an insurance company payment history reference file. Explain reasons for claim inquiries. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Learning Objectives (cont’d.) Define terminology pertinent to problem paper and electronic claims. State solutions for denied or rejected paper and electronic claims. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Claim Policy Provisions Be aware of provisions of insurance policies Payment time limits vary by payer 4-12 weeks for paper claims 7 days for electronic claims Managed care plan can vary in payment schedule Contact the insurance company if payment is not received in a reasonable amount of time. State insurance commissioners can help obtain late payments from different carriers, depending on the state. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Explanation of Benefits States the status of a claim Paid Adjusted Suspended/Pending Rejected Denied States the allowed and disallowed amounts Provided with payment check (if applicable) Also referred to as a remittance advice, check voucher, or payment voucher. What is a “suspended claim”? (A claim that is processed by a third-party payer but is held in an indeterminate/pending state about payment either because of an error of their need for additional information from the provider of service or the patient.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Components of an EOB Insurance company’s name and address Provider of services Dates of services Service or procedure codes Amount billed Reduction or denial codes, comment codes The explanation of benefits (EOB) is the starting point to understanding and addressing outstanding or problem claims. You’ll want to study the details of the EOB line by line. Reduction or denial codes include comment codes with reasons, remarks, or notes indicating reasons payments were denied. Explain the purpose of reduction or denial codes. (Ask for more information to determine coverage and benefits, or state amounts of adjustment because of payments by other insurers.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Components of an EOB (cont’d.) Claim control number Subscriber’s and patient’s name, policy numbers Patient’s payment responsibility Copayment Deductibles Total paid by insurance carrier An analysis of the patient’s total payment responsibility could include the amount not covered, copayment, deductible, coinsurance, and other insurance payment. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Interpreting an Explanation of Benefits (EOB) Fig. 9-1 Time limits for receiving payment from electronic claims are much shorter than for manual claims for all types of insurance coverage. See Chapter 3 for instructions on posting an EOB to a patient’s account. FIGURE 9-1 One example of an explanation of benefits (EOB) document with accompanying check that the provider received from a private third-party payer. These payment voucher documents vary among insurance companies. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Claim Management Techniques Insurance claims register Tickler file Aging reports A spreadsheet software program can help generate an insurance claims register that is easy to update. What is another name for a “tickler file”? (Suspense file, follow-up file) Electronic practice management system can run a monthly “aging report” to identify which claims are still outstanding. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Insurance Company Payment History Insurance company name and regional office addresses Claims filing procedures Payment policies Time limits for claims and payments Dollar amount for procedural codes Patient names and policy and group numbers To track the payment history of insurance companies, use software or a manual system. Include the information listed in this slide. Be sure to keep names of patients and their policy and group numbers current. Discuss the value of an insurance company payment history. (It is easy to see which companies pay slowly or pay less for certain services, and provides reports for tax purposes or to determine financial trends.) Explain when the payment history will come in handy and save the administrator time in claims follow-up. (All the information is on one report, which makes follow-up easier and more efficient.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Claim Inquiries No response for 45 days Payment was not received within contractual time limit Incorrect payment was received Amount allowed/patient’s responsibility are not defined Payment received for incorrect patient EOB/RA show changed code EOB/RA shows a disallowed service that was a benefit Claim needs revision and resubmission EOB/RA has an error Payment was made out to the wrong physician Inquiries should be submitted in writing, whenever possible. See Fig. 9-3 and Fig. 9-4 for sample inquiry letters. When calling to inquire about a claim, document the date, time of call, and the name of the person spoken to, along with an outline of the conversation. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Problem Claims Delinquent Suspense (pending) Payment is overdue Nonpayment caused by an error or the need for additional information, etc. These are some types of problem claims. The medical office will encounter many types of claims problems. You should have a procedure or plan to respond so that claims can be settled. Use a tickler file to help you keep on top of delinquent and suspense claims and follow up with the insurance company. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Problem Claims (cont’d.) Lost claims If you don’t receive a stamped acknowledgment that a claim is received by the insurer with an assigned claim number, then the claim may be lost. Rejected claims For potentially lost claims, sometimes a backlog on the insurer’s part results in a lack of a response. You can send a copy of the original claim to the insurer, but be sure to make it clear that you are not rebilling. A claim might be rejected if it doesn’t follow all the insurer’s instructions. You can submit a corrected claim to address the problem. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Problem Claims (cont’d.) Denied claims Other Downcoding Partial payment Lost payment Payment to the patient Underpayment Overpayment If a claim is denied, you’ll want to know the reason. Was the diagnosis not covered? Was prior approval for the treatment required? If a claim is denied, inform the patient and work with the physician to address the problem. Explain some reasons why an insurance claim may be denied. (Answers will vary.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Preventing Denied Claims Verify insurance coverage at the first visit. Make sure demographic information is current at each visit. Include progress notes and orders for tests for extended hospital services. Submit a letter from the prescribing physician documenting necessity when ambulance transportation is used. Clarify the type of service. Use modifiers to further describe and identify the exact service rendered. Denied claims occur for many reasons, so be proactive to try to prevent or minimize them for your practice. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Preventing Denied Claims (cont’d.) Keep abreast of the latest policies for the Medicare, Medicaid, and TRICARE programs by reading local newsletters. Obtain the current provider manuals for all contracted payers, including the Blue Plans, Medicaid, Medicare, and TRICARE. Put bulletins from these programs in the manuals so they’re up-to-date. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Filing Appeals Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Learning Objectives Identify reasons for rebilling a claim. Describe situations for filing appeals. Name Medicare’s five levels of redetermination (appeal) process. Determine which forms to use for the Medicare review and redetermination process. Name three levels of review under the TRICARE appeal process. List four objectives of state insurance commissioners. Mention seven problems to submit to insurance commissioners. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Rebilling Do not rebill a payer without investigating why the claim is still outstanding Corrected claims should be resubmitted Patient bills should be sent out monthly Why should you always investigate an outstanding claim before rebilling? (Rebilling without investigating could create duplicate claims for the same service.) A correction notice may be sent with a corrected claim. See Fig. 9-6. Clams with minor errors (missing identification numbers, etc.) can be rebilled, instead of having to go through the appeal process. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Appeal Situations Payment is denied Payment is incorrect Physician disagrees with insurer Unusual medical circumstances Precertification not provided Inadequate payment/complicated procedure Deemed “not medically necessary” When you can’t address a claim problem using the basic measures, you may have the option to appeal by making a formal request for a review. Consult the physician to see if this is a good idea. If you appeal, you must follow the laws and regulations surrounding an appeal and also the insurer’s procedures. Collect all your documents and call the insurance claims representative or adjuster to find out how to solve the problem. Explain how appeals differ from standard administrative efforts to solve claims problems. (Appeals are not just to fix minor errors. They are meant to challenge the outcome of the claims process, due to a discrepancy.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Filing an Official Appeal Send explanatory letter Excerpt coding resource book Peer review Send a letter explaining the reason why the provider does not agree with the claim denial listed on the EOB/RA (explanation of benefits/remittance advice). Put together excerpts from the coding resource book and attach a photocopy for the article or pertinent information showing the coding resource and date of publication. What is a “peer review”? (An evaluation done by a group of unbiased practicing physicians to judge the effectiveness and efficiency of professional care rendered. This can determine the medical necessity and subsequent payment for the case in question.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Filing an Official Appeal (cont’d.) Include similar cases Call the insurer Keep copies Send copies of similar cases with increased reimbursement from the same insurance company, if available, from your insurance company payment history file. Call the insurance company and speak to the person who handles appeals, explaining what you want to accomplish. Send any correspondence to that person also. Discuss why it is a good idea to keep all copies of data sent for the physician’s files. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Medicare Review and Redetermination Telephone review Redetermination Reconsideration Each insurer may have its own appeals process. Because Medicare covers so many patients, become familiar with its appeals process. The first level of appeal is a simple inquiry. In these cases, you might be able to solve the problem by submitting a corrected claim. Moving up to a higher level of appeal, a physician may ask for a review of a denial of Medicare Part B claims. This can be done with a letter and government form. To progress to the next level of appeal, the physician may feel that the review is unfair and request a hearing on the matter. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Medicare Review and Redetermination (cont’d.) Administrative law judge hearing Judicial Review CMS regional offices Medigap Some hearings, depending on the amount in question, may be requested from an administrative law judge. The Social Security Administration also has an appeals council if you feel the judgment was not lawful. Finally, in costly and controversial cases, you might appeal all the way to a federal district court. Explain why the appeals system progresses in levels. Discuss the advantages of this administrative/judicial approach for the insurer, the physician, and the patient. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

TRICARE Review and Appeal Reconsideration Conducted by the claims processor or other TRICARE contractor Formal review Conducted by TRICARE headquarters Hearing Administered by TRICARE but conducted by an independent hearing officer TRICARE has its own level of review. Keep in mind that appeals procedures for TRICARE contractors may vary. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

State Insurance Commissioner Objectives To make certain that the financial strength of insurance companies is not unduly diminished To monitor the activities of insurance companies to make sure the interests of the policyholders are protected To verify that all contracts are carried out in good faith To make sure that all organizations authorized to transact insurance, including agents and brokers, are in compliance with the insurance laws of the state Regulations vary widely from state to state. Insurance commissioner will review policies to determine whether the denial of a claim was legal or not. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

State Insurance Commissioner Objectives (cont’d.) To release information on how many complaints have been filed against a specific insurance company in a year To help explain correspondence related to insurance company bankruptcies and other financial difficulties To assist if a company funds its own insurance plan To help resolve insurance conflicts Insurance commissioners do not have the legal authority to order an insurance carrier to make a payment. Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Problems Submitted to Commissioner Improper denial or underpayment Delay in claim settlement Illegal cancellation of policy Misrepresentation by insurance agent Misappropriation of premiums Problems with premium rates Two companies (which is primary?) This slide lists the types of problems that should be submitted to your state’s insurance commissioner. Discuss the state’s insurance commission or department, its structure, and its regulatory function. (Answers will vary, based on state.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.

Commission Inquiries Should Contain: Patient’s (policyholder’s) name, address, phone number Insured’s name Insurance agent Complaint Patient’s signature and date Insurance company Policy or claim number Date of loss Everything related to insurance claims and filings has to be done according to procedures. If you submit a request to the insurance commissioner, it should include all the information provided in this slide. Suggest some methods that could be used to speed up payment from a continually slow-paying insurance company. (Copying the carrier on letters to the insurance commissioner, rating the carrier with the commissioner’s office. Answers will vary.) Copyright © 2012, 2010, 2008, 2006, 2004, 2002, 1999, 1997, 1995, 1989, 1981, 1977 by Saunders, an imprint of Elsevier Inc. All rights reserved.