1. HP Provider Relations October 2011 Spend-down

2. Spend-downOctober 20112 Agenda –Objectives –Spend-down Rule –Spend-down Eligibility –Eligibility Verification System –Enhanced Spend-down Information –Billing a Member –Claims Processing –Examples of Application of Spend-down –Spend-down Quiz –Helpful Tools –Questions & Answers

3. Spend-downOctober 20113 Objectives –To provide a thorough explanation of spend-down rules and eligibility –To explain when it is appropriate to bill Medicaid members for spend-down –To outline claims processing procedures related to spend-down

4. Spend-downOctober 20114 Spend-down Rule 405 IAC 1-1-3.1 – Providing services to members enrolled under the Medicaid spend-down provision –Subsection (d) states: A provider may not refuse service to a Medicaid member pending verification that the monthly spend-down obligation has been satisfied A provider may not refuse service to a Medicaid member solely on the basis of the member’s spend-down status

5. Define Spend-down Eligibility

6. Spend-downOctober 20116 Spend-down Eligibility –405 IAC 2-3-10 – Spend-down eligibility Certain types of income are counted in determining Medicaid eligibility Income greater than a certain threshold is considered "excess income” and is referred to as "spend-down obligation" –Spend-down, therefore, is very similar to a "deductible" The Medicaid member is liable for their initial Medicaid expenses each month, up to their spend- down amount Spend-down amounts are deducted from the first claim(s) processed each month  Pharmacy providers that bill claims on a point of sale (POS) system receive immediate claim adjudication and may collect the amount of spend-down credit at the time of service

7. Spend-downOctober 20117 Spend-down Eligibility Spend-down may be applied to members in the following aid categories: –Traditional Medicaid fee-for service (FFS) –MEDWORKS –Home and Community-Based Services (HCBS) Waiver Members assigned to Care Select or the risk-based managed care (RBMC) program are not assigned a spend-down

8. Spend-downOctober 20118 Eligibility Verification System –Enhanced spend-down information became available on the Eligibility Verification System (EVS) beginning January 1, 2010 –Using EVS, providers can determine the amount of spend-down remaining to be met for a particular month Note: The amount indicated may not be the actual spend-down amount credited to your claim –With the exception of pharmacy claims billed on a POS system, providers may not collect the spend-down amount at the time of service –Reference the IHCP Provider Manual, Chapter 2, Section 4, for additional information Spend-down information on EVS

9. Spend-downOctober 20119 Eligibility Verification System Enhanced spend-down information

10. Learn Billing a Member

11. Spend-downOctober 201111 Billing a Member –Providers should always review the Remittance Advice (RA) to see if Adjustment Reason Code (ARC) 178 applies to any claims on the RA The end of the RA lists the ARC codes that appear within that week’s RA. Review the listing to verify if ARC code 178 is included. –ARC 178 indicates there is a spend-down amount billable to at least one member on that week’s RA –A provider may bill a member for the dollar amount identified beside ARC 178 on the RA statement –This amount will also appear in the "Patient Responsibility" column on the RA

12. Spend-downOctober 201112 Billing a Member –Once the claim has adjudicated, providers are responsible to bill the member for the spend-down amount credited on the claim –The member is not obligated to pay the provider until the member receives the Medicaid Spend-down Summary Notice listing the amount applied to spend-down Notices are sent on the second business day following the end of the month The notices give a detailed itemization of how the spend-down was applied for that month, including provider name, amounts, and dates of service

13. Spend-downOctober 201113 Billing a Member What if the member doesn’t pay their spend-down? –Providers may discharge a member from their care if a member does not adhere to established payment arrangements of outstanding copayments or spend-down –Providers cannot be more restrictive with spend-down members than with other patients

14. Spend-downOctober 201114 Error Codes 0387 and 0388 –Providers may have encountered claim denials due to explanation of benefits (EOB) codes 0387 or 0388 – This service is not payable. The recipient has not satisfied spend-down for the month. –Providers should notify their field consultant when claims deny for these error codes. Note:Claims adjudicate to a paid status when spend-down is credited on a claim. Spend-down-related claims should not adjudicate to a denied status.

15. Spend-downOctober 201115 Quiz QHow can providers determine when a member has a spend-down? QWhy can’t providers collect the spend-down at the time of service? QHow is the provider informed that spend-down has been credited on claims?

16. Spend-downOctober 201116 Quiz Responses QHow can providers determine when a member has a spend-down? AProviders can verify a member’s eligibility using Web interChange, Automated Voice Response (AVR), Omni, or the Health Insurance Portability and Accountability Act (HIPAA) 277/278 transaction QWhy can’t providers collect the spend-down at the time of service? AThe amount credited to spend-down is not known until the claim adjudicates QHow is the provider informed that spend-down has been credited on claims? AProviders should review the RA to determine if and how much has been credited to spend-down

17. Explain Claims Processing

18. Spend-downOctober 201118 Claims Processing –The first claim processed by the IHCP applies to spend-down, regardless of the date of service within the month –The system uses the billed amount to credit spend-down Therefore, providers should bill their usual and customary charge –Third Party Liability (TPL) amounts are deducted from billed amount prior to crediting spend-down –State-mandated copayments for pharmacy and transportation claims credit spend-down first

19. Spend-downOctober 201119 Claims Processing –Services that are not covered by the Medicaid program do not credit spend-down –Exceptions: A service that is denied because the member exceeds a benefit limitation, which cannot be overridden with prior authorization (PA), may credit spend- down Denied services may be split between spend-down months Denied services

20. Spend-downOctober 201120 Claims Processing Date Billed: September 25, 2011 –$100.00 Spend-down Remaining for September –$200.00 Spend-down Remaining for October Benefit limit exhausted – Example 1 Billed AmountClaim StatusAuditCredit to Spend-down $200.00Denied6122 – Chiropractic Therapeutic Physical Medicine Treatments Limited to 50 $100.00 – September $100.00 – October

21. Spend-downOctober 201121 Claims Processing –When a claim is paid and credits the member’s spend-down, a provider-initiated void or replacement can cause an increase or decrease in spend-down amount owed to a provider for the claim –In the event a refund is due to the member as a result of a voided claim, the member is notified in the Medicaid Spend-down Summary Notice The member must have paid the provider to be eligible for a refund –Voids and replacements adjust the spend-down credit immediately Voids and replacements

22. Spend-downOctober 201122 Claims Processing The Division of Family Resources may also credit spend-down for certain “non-claim” expenses, including: –Medical expenses incurred by a recipient’s spouse or other person whose income is considered in determining eligibility –Medical services provided by non- Medicaid providers –Services rendered prior to eligibility

23. Spend-downOctober 201123 Claims Processing Hierarchy of spend-down credits: –Non-claim items entered by the DFR caseworker –State-mandated transportation and pharmacy copayments –Denied details, when permitted –Paid details

24. Spend-downOctober 201124 Claims Processing –Each month, HP performs a month-end balancing process that ensures all “non-claim” items entered by the DFR are credited first –This process ensures that all spend-down items are applied in accordance with the established hierarchy –HP may initiate claim adjustments as a result of month-end balancing Claims adjusted by the month-end balancing process have an internal control number (ICN) that begins with 64 –These adjusted claims result in additional reimbursement to the provider Month-end balancing

25. Spend-downOctober 201125 Claims Processing Example 1 – Spend-down activity for September – $500 Order of Claims that Credit the Spend- down Date of Service Provider Type Amount Incurred Method of Claim Submission Claim Processing Date Claim Status Spend-down Balance for September 19/2/11Pharmacy$50.00 (Includes Copay) Point of Sale (POS) 9/2/11Paid $0.00$450.00 29/5/11Physician$100.00Web interChange 9/5/11Paid $0.00$350.00 39/8/11Pharmacy$50.00 (Includes Copay) Point Of Sale (POS) 9/8/11Paid $0.00$300.00 49/7/11Non- Claim $50.00ICES (County Office) $250.00 59/8/11Outpatient Hospital $300.00837I (Electronic) 9/15/11$250.00 Credit spend- down Paid $0.00 $0.00 (Allowed amount is less) 69/2/11Dental$100.00Paper9/20/11Paid IHCP Allowed

26. Spend-downOctober 201126 Claims Processing Example 2 – Spend-down activity for October – $300 Order of Claims that Credit the Spend- down Date of Service Provider TypeAmount Incurred Method of Claim Submission Claim Processing Date Claim Status Spend- down Balance for October 110/2/11Pharmacy$20.00 (Includes Copay) Point of Sale (10:00 a.m.) 10/2/11Paid $0.00 $280.00 210/2/11Physician$50.00Web interChange (2:00 p.m.) 10/2/11Paid $0.00 $230.00 310/8/11Dental$100.00Web interChange 10/8/11Paid $0.00 $130.00 410/25/11PhysicianVoid of Claim #2 for $50.00 Web interChange 10/25/11Void Entire Claim $180.00 510/28/11Dentist$100.00Paper10/15/11Paid $0.00 $80.00 610/29/11Transport$150.00Paper10/20/11$80.00 Credit Spend- down $0.00 (Allowed amount is less)

27. Spend-downOctober 201127 Claims Processing Example 3 – Spend-down activity for June – $400 Order of Claims that Credit the Spend- down Date of Service Provider TypeAmount Incurred Method of Claim Submission Claim Processing Date Claim Status Spend- down Balance for June 16/2/11Pharmacy$50.00 (Includes Copay) Point of Sale (POS) 6/2/11Paid $0.00$350.00 26/5/11Physician$100.00Web interChange 6/5/11TPL paid $25.00 Paid $0.00 $275.00 36/8/11Pharmacy$50.00 (Includes Copay) Point Of Sale (POS) 6/8/11Paid $0.00$225.00 46/8/11Outpatient Hospital $200.00837I (Electronic) 6/15/11Paid $0.00$25.00 56/2/11Transport$100.00Paper6/20/11$25.00 Credit $2.00 copay rolls forward) $0.00 (Allowed amount is less)

28. Spend-downOctober 201128 Spend-down Quiz (True or False) QA provider may refuse to provide service to a member if they verify eligibility and determine the member has a spend-down? QA provider may refuse to provide a service to a member who has a legitimate past-due balance for a spend-down, but refuses to pay it? QA provider may bill the member for spend-down as soon as they receive a Remittance Advice that includes ARC 178? QSpend-down is credited based on the provider’s usual and customary charge (UCC)? QSpend-down is credited to claims in date-of-service order? QThe highest priority transaction to credit spend-down are “non- claim” items entered by the DFR?

29. Spend-downOctober 201129 Spend-down Quiz (True or False) QA provider may refuse to provide service to a member if they verify eligibility and determine the member has a spend-down? FALSE QA provider may refuse to provide a service to a member who has a legitimate past-due balance for a spend-down, but refuses to pay it? TRUE QA provider may bill the member for spend-down as soon as they receive a Remittance Advice that includes ARC 178? TRUE QSpend-down is credited based on the provider’s usual and customary charge (UCC)? TRUE (when the provider bills the UCC) QSpend-down is credited to claims in date-of-service order? FALSE QThe highest priority transaction to credit spend-down are “non- claim” items entered by the DFR? TRUE

30. Find Help Resources Available

31. Spend-downOctober 201131 Helpful Tools Avenues of resolution –IHCP Provider Manual, Chapter 2, Section 4 (Web, CD, or paper), available at indianamedicaid.com indianamedicaid.com –Customer Assistance Local (317) 655-3240 All others 1-800-577-1278 –Written Correspondence HP Provider Written Correspondence P. O. Box 7263 Indianapolis, IN 46207-7263 –Provider field consultant

32. Q&A