1. Chapter 17
Medical Insurance

2. Understanding the Role of Medical Insurance
Medical care consists of:
Diagnosis of diseases/disorders
Care and treatment provided by health care team
Health care
Preventive services

3. Understanding the Role of Medical Insurance
Health care insurance
Contract between an individual policyholder and a third party that reimburses the medical provider or policyholder
Changes in health insurance

4. Medical Insurance Terminology
Terminology specific to insurance policies
Beneficiary
Deductible
Coinsurance
Co-payment
Pre-existing condition

5. Medical Insurance Terminology
Terminology specific to insurance policies
Exclusions
Coordination of benefits
Birthday rule
Explanation of benefits (EOB)
Remittance advice

6. Medical Insurance Terminology
Terminology specific to billing insurance carriers
Preauthorization
Claim
CMS-1500 (05-08)
Assignment of benefits
Direct payment

7. Types of Medical Insurance Coverage
Traditional insurance policies
Fee-for-service basis
Types of coverage
Basic insurance
Major medical insurance
Primary care provider (PCP)

8. Types of Medical Insurance Coverage
Blue Cross and Blue Shield
Organized as not-for-profit corporations or as for-profit companies
Network of participating providers

9. Types of Medical Insurance Coverage
Managed care organizations (MCOs)
Case managers
Six primary models listed
Exclusive provider organizations (EPOs)
Integrated deliver systems (IDSs)
Health maintenance organizations (HMOs)
Point-of-service (POS) plans
Preferred provider organization (PPO)
Triple option plan
Capitation

10. Types of Medical Insurance Coverage
Medicare
Largest medical insurance program in the U.S.
Continuing medical coverage to senior citizens
Parts A, B, C, D
Annual deductible
Resource-Based Relative Value Scale
PARs and non-PARs
Medicare supplemental insurance

11. Types of Medical Insurance Coverage
Other types of coverage
Medicaid
Funding for medical care for qualifying persons
Eligibility
Medicaid is always secondary to any supplemental insurance

12. Types of Medical Insurance Coverage
Other types of coverage
TRICARE
Military personnel coverage
Three options available
Qualified subscribers must be listed with DEERS

13. Types of Medical Insurance Coverage
Other types of coverage
CHAMPVA (Civilian Health and Medical Program of the Veterans’ Administration)
Covers spouse and unmarried dependent children of veterans with permanent total disability from a service-related injury
Covers surviving spouse and children of veterans who died of service-related disability

14. Types of Medical Insurance Coverage
Other types of coverage
Workers’ compensation or state industrial insurance
On-the-job accident or illness
Workers’ compensation insurance

15. Types of Medical Insurance Coverage
Other types of coverage
Self-insurance
Larger companies, nonprofit organizations, state and county governments
Contact plan administrator before scheduling appointments

16. Screening for Insurance
Screen all new patients for insurance
New patients arrive 15–20 minutes early to complete patient registration form
Photocopy patient’s driver’s license and insurance card(s) and file in chart
Procedure 17-2 Screening for Insurance

17. Screening for Insurance
Verify insurance information on all patients

18. Screening for Insurance
Watch the video

19. Referrals and Authorizations
Referral categories
Preauthorization and precertification
Authorization/referral number entered in Box 23 of CMS-1500 (05/08) form
Procedure 17-3 Obtaining Referrals and Authorizations

20. Determining Fee Schedules
Common elements used to determine fee schedules
Overhead or practice expenses
Cost of medical malpractice insurance
Hourly rate for the services provided by the provider

21. Determining Fee Schedules
Usual, Customary, and Reasonable (UCR) fees
Fee system that defines allowable charges
Usual fee is the physician’s average fee for a service or procedure
Customary fee is the average or range of fees within the geographic area that an insurance carrier will accept
Reasonable fee is the generally accepted fee for services or procedures that are extraordinarily difficult or complicated

22. Determining Fee Schedules
Resource-Based Relative Value System (RBRVS)
Used by Medicare
Provider’s services are reimbursed based on RVUs

23. Determining Fee Schedules
Resource-Based Relative Value System (RBRVS)
Each service, procedure, or medication is assigned a code from the CPT or ICD-9-CM manuals
GPCI related to geographic area where physician is located is issued for each RVU category
Review and study Table 17-2
Assign or discuss critical thinking box
Procedure 17-4 Computing the Medicare Fee Schedule

24. Determining Fee Schedules
Hospital Inpatient Prospective Payment System (IPPS)
Based on DRGs
DRGs are based on an average cost for treatment of a patient’s condition

25. Determining Fee Schedules
Hospital Outpatient Prospective Payment System (OPPS)
Reimbursement system based on Ambulatory Payment Classifications (APCs)
APCs group services according to clinical characteristics

26. Determining Fee Schedules
Capitation
Payment system used primarily by MCOs

27. Legal and Ethical Issues
Medical personnel are bound by law to maintain confidentiality of all medical information
Must be able to recognize information that is protected by privacy rules

28. HIPAA Implications
Provide patient with a “notice of privacy practices” and obtain acknowledgment of receiving the notice
Obtain patient’s specific authorization to use or disclose personal information

29. HIPAA Implications
Provide patient, upon request, with an accounting of disclosures of PHI
Give patient access to his/her PHI and provide opportunity to amend

30. Insurance Fraud and Abuse
Definition of fraud and examples
Insurance abuse and examples
Protect the practice from committing insurance fraud and abuse

31. Insurance Fraud and Abuse
HIPAA regulations that apply to PHI