1. CHAPTER 18: Medical Insurance Claims Lesson 1: Insurance Claim Forms

2. Lesson Objectives
Upon completion of lesson, students should be able to …
Define, spell and use key terms.
Define and discuss various health insurance forms.

3. Key Terms Firewall Claims Administrator Forms:
Centers for Medicare and Medicaid Services (CMS)
CMS 1500
CMS 1450 (UB-04)
DD 2642
Breach of Confidentiality
Assignment of benefits
Birthday rule
Primary vs. Secondary
Clean Claim
Dirty Claim
Invalid Claim
Denied Claim
Clearinghouse
Par
Nonpar
Write-off

4. Purpose of Health Insurance Claim Form
Report pt procedures and services to insurance carrier
Help standardize reporting
Improve communication between medical facility and insurance carrier 4

5. 3 Main Elements to Improve Communication Process
Use of correct health insurance claim form
Use of incorrect form may cause claim to be rejected causing delayed or no payment
Accuracy of information provided in health insurance claim form
Submission of health insurance claim form to correct insurance carrier

6. Types of Health Insurance Claim Forms
CMS-1500
Most common health insurance claim form
Used to file claims for physician services
Submitted to insurance carrier electronically or by standard mail
CMS-1450(UB-04)
Used to report services related to hospitalization 6

7. Submitting Medicare Claim
Covered benefits change
Keeping up-to-date important for accurate claims submission
Critical to know:
Coverage
Benefit period
CMS-1500 used for Medicare claims
Claims to Medicare can be sent electronically or by standard mail 7

8. Submitting Medicaid Claim
Claim submission varies from state to state
Typically pts must qualify for benefits monthly. Eligibility not automatic.
Preauthorization required for some services
Critical to verify pt eligibility at each visit 8

9. Submitting Medicaid Claim
Crossover claim filed on pts with Medicare and Medicaid
Claims submitted on CMS-1500
Claims can be sent electronically or by standard mail 9

10. Submitting TRICARE Claim
DD Form 2642:
Form completed and sent by pt or family member
Payment sent to pt who is responsible to then pay provider
CMS-1500:
Form completed and sent by physician’s office
Payment is sent directly to provider’s office
CMS 1450
Form completed and sent by hospital
Payment is sent directly to hospital 10

11. Submitting Workers’ Comp Claim
Claim form depends on state and insurance carriers in that state
Typically CMS-1500 accepted
Important for MA to call and verify what form must be used for claims submission
Pt does not pay for procedures and services provided by workers’ comp
Employer ultimately responsible 11

12. Chapter 18:Medical Insurance Claims Lesson 2: Types of Claims

13. Methods to Submitting Claims
No matter method same information provided
Method dependent on insurance carrier
Two methods used today:
Faxing or mailing paper claim
Submitting claim electronically 13

14. Critical Thinking Question
Why might medical office choose to file paper claims rather than electronic claims?

15. Paper Claims Claims completed manually
Problems with this method often include errors, leading to more claims being rejected or time loss for resubmission of claims
Errors in paper claims include:
Omission of information
Typographical errors
Incorrect mathematical calculations 15

16. Advantages of Paper Claims
Basic costs are minimal
Materials needed for paper claims:
Claim forms
Coding books 16

17. Disadvantages of Paper Claims
Costs to complete paper claim process can be costly
These costs include costs for:
Time required to complete form
Higher chance of errors
Storage space
Postage
Copies of claim forms 17

18. Requirements of Paper Claims
All claims must be on original claim form
Claim must be legible
Dark ink must be used
Capital letters used when appropriate
Punctuation, decimals, dollar signs are never used
Use of correction tape unacceptable
No use of adhesive tape, staples, and paper clips
Documentation must be placed in same envelope as paper claim 18

19. Electronic Claims
Claims sent directly to insurance carrier or clearinghouse
All medical offices who were not considered small
Institutional organizations < 25 FT or Physician’s offices with < 10 FT
Mandated to submit electronic claims since October, 2003 19

20. Clearinghouse
Independent entity that reviews claims and submits them to insurance companies
Charges for services provided
Eliminates need for specific software required by different carriers
Checks claim for accuracy, thereby reducing incidences of claim rejection

21. Advantages of Electronic Claims
Increases speed of claims processing by both insurance carrier and provider
Decreases turnaround time in processing
Provides capability for direct electronic deposit of payments in provider account
Saves money on postage and labor costs for provider 21

22. Disadvantages of Electronic Claims
Initial start-up expenses:
Internet service provider
Computer
Software
Training of those who will be using system
Printer
Backup or storage devices
Computer down times 22

23. Three Ways Claims are Transmitted
Sent directly to payer via EDI (electronic data interchange)
Transmitted through clearinghouse
DDE (direct data entry)

24. Statuses of Claim Clean claims: Dirty claims: Invalid claims:
Form is completed without any errors or omissions and submitted on time
Dirty claims:
Form is incorrect because of missing data or errors, causing claim to be rejected
Invalid claims:
Form is complete but has some type of incorrect information

25. Statuses of Claim Denied claims:
Procedure or services not covered by insurance policy
Patient has not met his/her deductible.
Ineligible procedures or services can also cause claim to be denied.

26. Chapter 18: Medical Insurance Claims Lesson 3: CMS-1500

27. Materials Needed to Complete CMS-1500
Pt’s medical record
Pt’s ledger card
Superbill
CMS-1500
Black ink pen
Computer with printer or typewriter 27

28. Superbill Contains: Pt’s name Diagnoses Treatments
Space for claim information 28

29. Superbill Usage: Originally created to allow pts to file own claims
Accepted by some insurance companies as claim form
Provides detailed information on services received 29

30. Information Needed to Complete CMS-1500
Name of insured’s insurance company
Insured’s name
Insured’s ID#, DOB
Insured’s address
Telephone # of insured
CPT Codes
ICD codes 30

31. Reading CMS-1500 Boxes (Blocks) 1-13: Boxes (Blocks) 14-33:
Pt data (DEMOGRAPHICS)
Boxes (Blocks) 14-33:
Provider information
Information on services provided to pt
Reason for services 31

32. Completion of CMS-1500: Boxes 1-832

33. Completion of CMS-1500: Boxes 9-1333

34. Completion of CMS-1500: Boxes 14-2334

35. CMS-1500: Box 24
Box 24:
24A – 8-digit date of when services for present condition have been received.
24B – Place of service 2 digit code.
24C – Leave blank.
24D – CPT/HCPCS code and modifier.
24E – Diagnosis code.
24F – Charges for service.
24G – Number of days or units of service.
24H-24j – Leave blank.
HCPCS Healthcare Common Procedure Coding System Two Levels (Level I CPT) 35

36. Completion of CMS-1500: Box 24 A-J36

37. Completion of CMS-1500: Boxes 25-3337

38. Confidentiality and CMS-1500
Information must remain confidential
Release of information must be signed by pt
Signed standard release form may be used
Form placed in pt file (not medical chart) 38

39. Assignment of Benefits
Allowed by Medicare and other carriers
One time form signed by pt
Provides authorization for pt information to be released
Once signed, usage of SIGNATURE ON FILE (SOF) can be used
Form must be permanently kept in pt’s file 39

40. Participating Providers
Physicians or medical facilities who choose to join insurance company due to incentives offered by carrier
Providers accept insurance carrier’s set dollar amounts for services rendered
Payments made directly to providers
Providers join by completing form and being assigned number 40

41. Participating vs. Nonparticipating Providers
Advantage:
Payment sent directly to practice, typically in timely manner
Disadvantage:
Reimbursement might be at less desirable rate leading to write-offs 41

42. Birthday Rule
Used to determine which parent’s insurance plan is primary
Only used for parents who are legally married
Primary plan held by parent whose birthday falls first in year
If parents have birthday on same day, parent who has had coverage longest would hold primary plan
Primary plan of divorced parents determined by court 42

43. Prior to Submitting Claim
Check for accuracy on claim form
If paper claim, make copy for pt’s file
Enter data on insurance claims log
Send completed CMS-1500 with required documentation to insurance carrier 43

44. 18 Chapter 18: Medical Insurance Claims Lesson 4:
Claims Security and Tracking Claims

45. Critical Thinking Question
Can confidentiality of patient information be guaranteed?

46. Maintaining Confidentiality of Patient Information
Responsibility of all health care workers
Breach of confidentiality occurs when information provided to individuals who have not been authorized to receive it 46

47. How to Keep Patient Information Secure
Ensure information only provided to approved individuals
Limit access to patient information in work areas
Create work areas where confidential information can be discussed privately
Follow rules established by HIPAA 47

48. Documentation of Permission
Authorization for Release of Medical Information
Block 12 on CMS-1500
Release form created by medical practice 48

49. Ensuring Electronic Data
Firewalls critical
Update each year 49

50. Insurance Claims Log Used to track claim forms
Can be done manually or electronically
Data entered when claim form is completed
Information on log:
Patient’s name
Date of service
Insurance carrier
Date of claim submission
Amount of claim submitted 50

51. Most Common Reasons for Claim Rejection
Missing or incorrect information
Missing or incorrect patient registration information (name, address, insurance number)
Missing or incorrect name of referring physician
Missing or incorrect diagnosis code
Overlapping, incorrect, or duplicate dates of service 51

52. Most Common Reasons for Claim Rejection
Incorrect place of service
Invalid, missing, or incorrect procedure code
Incorrect or missing number of days or units
Incorrect or missing modifier 52

53. Resubmitting Claims Information must be corrected and resubmitted
Use of patient data and other resources important for accuracy
Accuracy on claims critical!
Time limits for re-filing must be met! 53

54. Ways to Minimize Number of Rejected Claims
Review claim for accuracy prior to submitting it
Pay close attention to detail
Keep current reference materials, books and equipment readily available and use them
Limit distractions that can occur in medical office
Have specific time of day to focus solely on claims processing
Have another medical office staff member review each claim 54

55. Questions? Applied Practice Completing CMS1500 Finish all competencies
Finish all homework
NO LATE ASSIGNMENTS ACCEPTED!
Review for Final Exam 55