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Medical Insurance

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  1. Medical Insurance Lisa H. Young, RN, BSN

  2. Working with Medical Insurance and BillingChapter 1 • Three ways that medical insurance specialist help ensure the financial success of physician practices. (pages 3-7) • Following all procedures carefully • Communicating effectively • Using health information technology

  3. Working with Medical Insurance and Billing • Covered and Uncovered services under medical insurance policies (pages 7-8) • Covered: primary care, emergency care, medical specialists’ services and surgery; eligible for members; listed under the schedule of benefits of an insurance policy • Non-covered: are identified by the insurance policy as services for which it will not pay

  4. Working with Medical Insurance and Billing • Indemnity and Managed Care Approaches to Health Plan Organizations (pages 9 – 11) • Indemnity: the payer protects the member against loss form the costs of medical services and procedures • Managed: Restricted choice of providers and treatments in exchange for lower premiums, deductibles, and other charges

  5. Working with Medical Insurance and Billing • Health maintenance organizations (HMO) control healthcare costs by: • Creating a restricted number of physicians for members • Controlling the use of services • Controlling drug costs • Using cost-sharing methods (pages 11 – 14)

  6. Working with Medical Insurance and Billing • Preferred provider organization (PPO) • Create a network of hospitals and other providers for members to use at negotiated, reduced fees • Are the most popular type of healthcare • Generally require the payment of premium and copayments from patients (pages 14 – 15)

  7. Working with Medical Insurance and Billing • Consumer-driven health plan (page 16) • CDHPs combine a high-deductible, low-premium PPO with a pretax savings account to cover out-of-pocket medical expenses up to the amount of the deductible • Comparison of Health Plan Options Table 1.2 on page 16

  8. Working with Medical Insurance and Billing • Three major types of medical insurance payers: • Private payers • Employer sponsored • Government-sponsored (pages 17 – 18)

  9. Working with Medical Insurance and Billing • Ten steps in Medical Billing Cycle (pages 18-24) • Preregister patients • Establish financial responsibility • Check in patients • Coding compliance • Billing compliance • Check out patients • Prepare and Transmit claims • Generate patient statements • Follow up payments and collections

  10. Working with Medical Insurance and Billing • Professionalism and etiquette contribute to career success • Vital quality for all office personnel • Develop skills and attributes to perform work successfully • Strong code of ethics • Correct etiquette (pages 25-27)

  11. Working with Medical Insurance and Billing • Professional certification for career advancement (pages 27-28) • Membership in a professional organization • Certification for a professional organization • Certification through education, experience, and an exam

  12. HER, HIPAA, and HITECHChapter 2 • Accurate documentation with medical records (pages 36- 43) • Electric health records (EHRs) • Immediate access to health information • Computerized physician order management • Automated alerts and reminders • Electronic communication and connectivity • Patient support • Administration and report • Error reduction

  13. Documentation of Patient Encounters • Patient’s name • Encounter date and reason • Appropriate history and physical examination • Review of all tests that were ordered • Diagnosis • Plan of care, or notes on procedures or treatments that were given • Instructions or recommendations that were given to the patient • Signature of the provider who saw the patient

  14. Patient Medical Record • Biographical and personal information • Records of all communications • Records of prescriptions • Scanned records • Drug & environmental allergies • Up-to-date immunization record • Previous & current diagnoses • Records of referral letters • Hospital admissions • Records of missed or canceled appointments • Requests for information about the patient.

  15. EHR, HIPAA, and HITECH • HIPAA is a law designed to: • Protect people’s private health information • Health insurance coverage for employees with a change or lose of their jobs • Uncover fraud and abuse • Standards for electronic transmission of healthcare transactions (pages 44 - 47)

  16. EHR, HIPAA, and HITECH • ARRA of 2009 includes rules in the HITECH Act: • Provisions concerning the standards for electronic transmission of healthcare data • Guides the use of federal stimulus money to promote the adoption and meaningful use of health information technology, mainly using EHRs.

  17. EHR, HIPAA, and HITECH • Covered entities and business associates • Covered entity is a health plan, healthcare clearinghouse, healthcare provider who transmits health information in electronic form • Business associates, such as a law firm or billing service, work for the covered entity and agree to follow HIPAA regulations to safeguard PHI • Electronic data interchange is used to facilitate transaction of information (pages 47-49)

  18. EHR, HIPAA, and HITECH • HIPAA Privacy Rule (pages 49 - 57) • Regulates the use and disclosure of patients’ PHI • Use and disclosure of PHI is permitted for patients’ treatment, payment, and healthcare operations (TPO) • PHI may be released for court cases, workers’ compensation cases, statutory reports, and research • Providers are responsible for protecting their patients’ PHI

  19. HER, HIPAA and HITECH • Purpose of the HIPAA Security Rule • Protect the confidentiality, integrity, and availability of health information • Use of encryption, access control, passwords, log files, backups to replace items after damage, and by developing security policies to handle violations when they do occur. (pages 57 – 58)

  20. EHR, HIPAA, and HITECH • HITECH Breach Notification Rule • Requires covered entities to notify affected individuals following the discovery of a breach of unsecured health information • Covered entities have specific breach notification procedures (see page 59) • Breach occurs, individuals involved must receive a notification of the breach, which includes 5 key points of information, pg 59. (pages 58 – 60)

  21. EHR, HIPAA, and HITECH • Electronic Health Care Transactions and Code Sets (TCS) (pages 60- 62) • Establish standards for the exchange of financial and administrative data • Require covered entities to use common electronic transaction methods and code sets • Four National Identifiers are for employers, healthcare providers, health plans and patients

  22. EHR, HIPAA, and HITECH • Guard against potentially fraudulent situations • Regulations have been enacted to prevent fraud and abuse in healthcare billing • OIG has the task of detecting healthcare fraud and abuse and related law enforcement • FCA prohibits submitting a fraudulent claim or making a false statement or representation in connection with a claim • FERA strengthens the provisions of the FCA (pages 63 – 66)

  23. EHR, HIPAA, and HITECH • Enforcement of HIPAA (pages 66 – 68) • Reconcile differences in enforcement procedures • Office for Civil Rights enforces HIPAA privacy standards and CMS enforces all other standards • OIG combats fraud and abuse in health insurance and healthcare delivery

  24. EHR, HIPAA, and HITECH • Compliance plans include: • Consistent written policies and procedures • Appointment of a compliance officer and committee • Training plans • Communication guidelines • Disciplinary systems • Ongoing monitoring and auditing of claim preparation • Responding to and correcting errors • A sign that the practice has made a good-faith effort to achieve compliance (pages 68 – 70)

  25. Patient Encounters and Billing InformationChapter 3 • Classifying patients as new or established • Gather accurate information from patients to perform billing and medical care • New patients (NP)are those who have not received any services form the provider within the past three years • Established patients (EP) have seen the provider within the past three years • Established patients review and update the information that is on file about them (page 78)

  26. Patient Encounters and Billing Information • Five categories of information required of new patients (pages 78 – 87) • Basic personal preregistration and scheduling information • Patient’s detailed medical history • Insurance data for the patient or guarantor • A signed and dated assignment of benefits statement by the policyholder • Signed Acknowledgement of Receipt of Notice of Privacy Practices authorizing the practice to release the patient’s PHI for TPO purposes

  27. Patient Encounters and Billing Information • Information for established patients is updated: • Patient information forms are reviewed once a year by the patient • Patients are asked to double-check their information at their encounters • The PMP is updated to reflect any changes needed (pages 87 – 89)

  28. Patient Encounters and Billing Information • Eligibility for insurance benefits: • The provider checks the patient’s information form and medical insurance card • Contacts the payer to verify the patient’s general eligibility for benefits and the amount of copayment or coinsurance that is due at the encounter • Planned encounter a covered service considered medically necessary by the payer (pages 90 – 93)

  29. Patient Encounters and Billing Information • Referral or preauthorization approval • Preauthorization is requested before a patient is given certain types of medical care • Referrals; the provider often needs to issue a referral number and a referral document in order for the patient to see a specialist under the terms of the medical insurance • Providers must handle these situations correctly to ensure that the services are covered if possible (pages 93 – 95)

  30. Patient Encounters and Billing Information • Primary insurance for patients who have more than one health plan: • Patient information forms, insurance cards • Provider determines which policy is the primary insurance • Information entered in PMP and communication with payers are performed (pages 95 – 97)

  31. Patient Encounters and Billing Information • Encounter forms: • Lists of medical practice’s most commonly performed services and procedures and often its frequent diagnosis • Provider checks off the services and procedures a patient received, and the encounter form is then used for billing (pages 98 – 100)

  32. Patient Encounters and Billing Information • Eight types of charges collected from patients at the time of encounter: • Previous balance • Copayments • Coinsurance • Non-covered or over-limit fees • Charges of nonparticipating providers • Charges for self-pay patients • Deductibles for patients with CDHPs • Charges for supplies and copies of medical records (pages 100 -102)

  33. Patient Encounters and Billing Information • Real-time claims adjudication tools in calculating time-of-service payments • Allow the practice to view, at the time of service, what the health plan will pay for the visit and what the patient will owe • Provide valuable information and checks so that the practice and patients are aware of the expected costs and coverage • Inform or remind patients of the financial policy and give estimates of the bills they will owe (pages 102 – 105)

  34. Patient Encounters and Billing Information • Purpose of ICD-10-CM (pages 113 – 114) • Diagnostic coding • Codes made of three to seven alphanumeric characters • Addenda to codes

  35. Diagnostic Coding: ICD-10-CMChapter 3 • Organization of ICD-10-CM (pages 114 -115) • Two major parts; Tabular List & Alphabet Index • Alphabet Index: • Neoplasm Table • Table of Drugs and Chemicals • Index to External Causes • Conventions followed

  36. Diagnostic Coding:ICD-10-CM • Alphabet Index (pages 115-118) • Structure • Content • Key conventions

  37. Diagnostic Coding:CID-10-CM • Tabular List (pages 118 – 122) • Structure • Content • Key Conventions

  38. Diagnostic Coding:ICD-10-CM • ICD-10-CM Official Guidelines for Coding and Reporting (pages 123-128) • Rules for outpatient coding • Primary diagnosis first followed by current coexisting codintions • Sequelae • Code to the highest level of certainty • Code to the highest level of specificity

  39. Diagnostic Coding:ICD-10-CM • Steps for assigning correct ICD-10-CM diagnosis codes (pages 133-135) • Step 1: Review complete medical documentation • Step 2: Abstract the medical conditions form the visit documentation • Step 3: Identify the main term for each condition • Step 4: Locate the main term in the Alphabetic Index • Step 5: Verify the code in the Tabular List • Step 6: Check compliance with any applicable Official Guidelines and list codes in appropriate order

  40. Diagnostic Coding:ICD-10-CM • Difference between ICD-9-CM and ICD-10-CM codes (pages 135-137) • 10 offers major advantages because many more categories for disease and other health-related conditions are available thus more flexibility for adding new codes in the future • Federal government has prepared GEMS to help coders transition from 9 to 10.

  41. Procedural Coding: CPT and HCPCSChapter 5 • CPT Code Set (pages 144-146) • Category I codes: procedure codes found in the main body of CPT • Category II codes: optional CPT codes that track performance measures • Category III codes: temporary codes for emerging technology, services, and procedures

  42. Procedural Coding: CPT and HCPCS • Organization of CPT (pages 146-151) • CPT Index • Six sections of Category I codes • Evaluation and Management • Anesthesia • Surgery • Radiology • Pathology and Laboratory • Medicine

  43. Procedural Coding:CPT and HCPCS • CPT format and symbols (pages 151 – 153) •  (bullet or black circle) • ▲ (triangle) • ►◄ (facing triangles) • + (plus sign) • (lightening bolt) • # (number sign)

  44. Procedural CodingCPT and HCPCS • Assigning modifiers to CPT codes (pages 153 – 156) • CPT Modifiers: Description and Common Use in Main Text Sections- Table 5.2 pg. 156 • Modifiers are shown by adding a space and the two-digit code to the CPT code

  45. Procedural Coding:CPT and HCPCS • Six steps for selecting CPT procedure codes to patient scenarios. (pages 157- 159) • Step 1: review medical documentation • Step 2: medical procedures • Step 3: identify main term for procedures • Step 4: locate main terms in CPT Index • Step 5: verify the code in CPT main text • Step 6: determine the need for modifiers

  46. Procedural Coding:CPT and HCPCS • Using key components in selecting CPT Evaluation and Management codes (pages 159-171) • Step 1: category and subcategory of service table 5.3 page 160 • Step 2: extent of history • Step 3: extent of the examination • Step 4: complexity of medical decision making • Step 5: requirements to report the service level • Step 6: service level • Step 7: complete documentation • Step 8: assign code

  47. Procedural Coding:CPT and HCPCS • Anesthesia section of CPT Category I codes (pages 172 – 173) • Physical status modifiers • Add-on codes • P1: healthy patient • P2: mild systemic disease • P3: severe systemic disease • P4: severe systemic disease –life threatening • P5: not expected to survive without surgery • P6: Brain-dead; organ donor

  48. Procedural Coding:CPT and HCPCS • Surgery section of CPT Category I Codes • Surgical packages include all the usual services in addition to the operation itself, • Separate procedures means that the procedure is usually done as an integral part of a surgical package, but no in all situations. (pages 173 – 177)

  49. Procedural Coding:CPT and HCPCS • Radiology section of CPT Category I codes (pages 177 – 179) • Two parts: • The technical component • The professional component

  50. Procedural Coding:CPT and HCPCS • Pathology and Laboratory section of CPT Category I codes (pages 179- 180) • Code for laboratory panels are bundled codes. Example of laboratory panel would be the electrolyte panel which requires: Carbon dioxide, chloride, potassium, and sodium