1. REIMBURSEMENT FOLLOW-UP AND COLLECTIONS Chapter 7

2. 2 Follow-up and Collections Reimbursement Follow-up and Collections Learning Objectives Describeclaim determination process Describe the claim determination process used by health plans. Followfive steps to process reimbursement Follow five steps to process reimbursement advices (RAs) from health plans. Discuss reasons for and appeals of reduced or denied payments Discuss common reasons for and appeals of reduced or denied payments. Describe patient billingcollections process. Describe the patient billing and collections process. Handlepatients’ inquiries Handle patients’ inquiries about insurance and billing problems.

3. Chapter 73 Key Terms Accounts receivable Adjustments Appeal Determination Downcoding Electronic funds transfer (EFT) Insurance aging report Patient aging report Patient ledger Patient statement Preexisting condition Uncollectible account

4. Chapter 74 Health Plan Claim Processing Medical Insurance Specialist clean claims Prepare & Transmit clean claims that will be paid in full and on time decide not to pay pay at a reduced level “account receivable”, Claims that payer pay late, decide not to pay, or pay at a reduced level have a negative effect on “account receivable”, (the practice’s cash flow) payer examine claims and determine payments The Medical Insurance Specialist must understand the process that payer follow to examine claims and determine payments

5. Chapter 165

6. Chapter 76 Claim Processing Payer receives complete claim Claims department determines: benefits 1.Whether benefits are due as per patient’s policy services 2.Whether services provided were medically necessary clinical information Occasionally, additional clinical information is requested

7. Chapter 77 Payment Determination Payer decides to Pay 1. Pay the claim Deny 2. Deny the claim Reduce 3. Reduce the payment for the claim

8. Chapter 78 Reduced Payments Carriers will reduce payment when: procedure The procedure does not link correctly to the diagnosis Documentation Documentation fails to support the level of service claimed

9. Chapter 79 Denied Payments Carriers will deny payment when: covered benefit The claim is not for a covered benefit preexisting condition Patient’s preexisting condition is not covered coverage Patient’s coverage has been cancelled In these instances, patient is billed

10. Chapter 710 Overdue Claims Claims must be monitored until payments are received. 7-14 days Follow-up period for most offices is 7-14 days after claims are transmitted. late payment “Aging Report”. To avoid late payment the medical Insurance Specialist regularly review the insurance the “Aging Report”. issuing an invoice receiving payment; Aging Report – A report that shows the time span between issuing an invoice and receiving payment; used in medical office to determine late payments and collect them.

11. Chapter 711 Overdue Claims aging report Insurance aging report Shows the ages of unpaid claims HIPAA Transaction Claim status inquiry is used to follow up with payers electronically 7-14 days Most offices follow up 7-14 days after claim is transmitted

12. Chapter 712 (RA) Processing the Remittance Advice (RA) RA RA is usually received electronically. payermedical office Sent by the payer to the medical office summarizes the determinations for a number of claims. RA RA lists the following: Claim control number Patient’s name Dates of Service Charges How payment amount is determined

13. Chapter 713 Five Steps Five Steps for Processing RAs Step 1Match patient’s name date of servicepayer’s payments Step 1Match claim control number, patient’s name, date of service with payer’s payments Step 2Checkpatient data, plan, procedures Step 2Check patient data, plan, procedures against claim Step 3Comparepayment Step 3Compare each payment with expected amount Step 4Read decide if resubmission or appeal is warranted Step 4Read carrier’s explanations for unpaid, reduced, or denied claims; decide if resubmission or appeal is warranted Step 5Determinewrite-offs Step 5Determine any write-offs (adjustments) and note balance due from patient

14. Chapter 714 Appeals asking carrier to review reimbursement on a claim Written request asking carrier to review reimbursement on a claim Usually filed when: did not filepreauthorization Physician did not file for preauthorization in a timely manner payment received Physician thinks payment received is inadequate disagrees with the carrier’s preexisting condition decision Physician disagrees with the carrier’s preexisting condition decision unusual circumstances Patient has unusual circumstances affecting treatment

15. Chapter 715 Other Options If appeal is denied Physician may request peer review Objective, unbiased group of physicians determines what payment is adequate for services provided. State Insurance Commissioners Regulatory agency; serves as liaison Physician, patient or carrier may appeal

16. Chapter 716 Patient Billing pays at time of service Patient usually pays at time of service if physician has not accepted assignment walkout receipt Medical billing program used to create walkout receipt for patient services,charges, Summarizes patient’s services, charges, payments for that visit pays copayment Patient pays copayment only if physician has accepted assignment

17. Chapter 717 Patient Billing (cont’d) Patient Statements Usually created and mailed monthly Medical billing software used to create bills Billing Statements Show: Dates of serviceservices provided Dates of service and services provided Paymentsinsurance carrier Payments from patient and insurance carrier Balance due Balance due

18. Chapter 718 Collections The collection process begins with effective communication with patients about their responsibility to pay for services aging report Patient aging report shows which patients have overdue balances 30 days A reminder is usually sent at 30 days More stringent collection letters sent subsequently Small claims courtcollection agencies Small claims court or collection agencies

19. Chapter 719 Uncollectible Accounts No payment has been made after the collection process has been exhausted It would be more costly to continue the collection process written off Amount owed is written off

20. Chapter 720 Complaints and Problems Medical insurance specialist acts as go- between with patients and health plans To help answer patient inquiries, ask if patient has: Contacted the health plan Spoken with the service representative Reviewed the policy

21. Chapter 721 Complaints and Problems (cont’d) If the patient has already contacted the health plan: Medical insurance specialist may contact the health plan again to get a detailed explanation Volunteer to explain to patient Speak slowly and calmly; use simple language Explain more than once, if necessary Ask questions to be sure patient understands explanation Use respect and care

22. Chapter 722 Quiz False, collections are begun after the bill is more than 30 days overdue. False, RAs are usually received electronically. RAs are usually received on paper. (T/F) An appeal is a formal method of asking for reconsideration of a denied claim. (T/F) Collections are done on current bills. (T/F) True, the appeal is done in writing.

23. Chapter 723 Critical Thinking What is the importance of prompt collection? Collection directly affects cash flow. Slow payments by health plans or patients may cause delays in the practice’s ability to meet the financial responsibilities of running a business.