A physician gets paid a specified dollar amount, for a given time period, to take care of the medical needs of a specified group of people.
Often used in Health Maintenance Organization (HMO) Insurance Plans and became prominent in the 1980s and 90s.
For example,
1. A physician is an HMO provider for a health plan paid at a capitation rate of $7.00 per member
2. People who have an HMO plan are required to select a primary care physician, by reviewing a list of physicians in a directory. This physician has been selected by 250 people to be their PCP
3. This physician gets paid $7.00 for each of the 250 members, or $1,750.00, each month
4. This physician is responsible for providing medical care to any of these 250 people with the $1,750.00 given
5. If the expenses are more than $1,750.00, the physician must cover the difference out of their own pocket
In other words, there is risk involved. The $1,750.00 capitated payment is the only amount the physician will receive from the health plan. Hypothetically, if each visit costs the physician an average of $110.00 (time, nursing, supplies, fixed costs, etc.), then the physician is able to see 16 of these 250 patients during a given month. If the physician sees more than 16 patients, then the physician is not able to cover the costs incurred for the month, and consequently, begins to lose money from this health plan contract.
Does this payment methodology encourage the physician to do less? Yes because they receive only a specified dollar amount each month to perform medical services to a group of people. Fee-for-service, on the other hand, continues to pay for each patient seen, without a specified limit. A physician may actually be encouraged to bill more to receive additional payments. (HMOs are often associated with Capitation, while PPOs commonly use the fee-for-service method).
Showing posts with label basics of medical billing. Show all posts
Showing posts with label basics of medical billing. Show all posts
Friday, January 15, 2010
Tuesday, January 12, 2010
Medical coding Basic
When billing for a patient’s visit, codes are selected that best represent the services furnished during the visit. The two common sets of codes that are currently used are:
1. Diagnostic or International Classification of Diseases, 9th Edition, Clinical Modification (ICD-9-CM) codes; and
2. Procedural or American Medical Association Current Procedural Terminology (CPT) codes.
These codes are organized into various categories and levels. It is the physician’s responsibility to ensure that documentation reflects the services furnished and that the codes selected reflect those services. The more work performed by the physician, the higher the level of code he or she may bill within the appropriate category. The billing specialist or alternate source reviews the physician’s documented services and assists with selecting codes that best reflect the extent of the physician’s personal work necessary to furnish the services.
1. Diagnostic or International Classification of Diseases, 9th Edition, Clinical Modification (ICD-9-CM) codes; and
2. Procedural or American Medical Association Current Procedural Terminology (CPT) codes.
These codes are organized into various categories and levels. It is the physician’s responsibility to ensure that documentation reflects the services furnished and that the codes selected reflect those services. The more work performed by the physician, the higher the level of code he or she may bill within the appropriate category. The billing specialist or alternate source reviews the physician’s documented services and assists with selecting codes that best reflect the extent of the physician’s personal work necessary to furnish the services.
Tuesday, January 5, 2010
Medicare and its plans
Medicare advantage plan are run by private companies and approved by CMS. Usually employer provide these plan for more coverage than Medicare. In this scenrio all your claims covered by Medicare advantage plan. Medicare and Medigap will not pay your claims.
The only problem in the Medicare advantage plan is patient has to see the PCP before see other doctors. In other words referral will be integeral part here
List of Plans:
Medicare Health Maintenance Organization (HMOs)Preferred Provider
Organizations (PPO) Private Fee-for-Service Plans
The only problem in the Medicare advantage plan is patient has to see the PCP before see other doctors. In other words referral will be integeral part here
List of Plans:
Medicare Health Maintenance Organization (HMOs)Preferred Provider
Organizations (PPO) Private Fee-for-Service Plans
Medigap and how does it work
Crossover insurance companies are insurers that provide secondary insurance plans and participate in the crossover program. Claims are automatically crossed over (for both participating and non-participating providers) when eligibility information is forwarded to Medicare from the plans that participate. There is nothing you need to indicate on the claim form. The Provider Remittance Notice will show a message that will tell you that the claim information has been forwarded to the secondary insurer.
The big advantage is we don't need to send the secondary claims.
A Medigap policy is an individual health benefit plan offered by a private insurance company to supplement Medicare. It provides reimbursement for charges not payable because of deductible, coinsurance or other limitations. For participating providers, Medicare will send payment information directly to Medigap insurers if the appropriate information is provided on the 1500 claim form.
There 12 different Medigap policies are available from A to L. Each policy has their own rules and benefits. Check the benefits of Patient Medigap policy before submitting the claims. Patient has to pay separate
premium for this insurance also.
The big advantage is we don't need to send the secondary claims.
A Medigap policy is an individual health benefit plan offered by a private insurance company to supplement Medicare. It provides reimbursement for charges not payable because of deductible, coinsurance or other limitations. For participating providers, Medicare will send payment information directly to Medigap insurers if the appropriate information is provided on the 1500 claim form.
There 12 different Medigap policies are available from A to L. Each policy has their own rules and benefits. Check the benefits of Patient Medigap policy before submitting the claims. Patient has to pay separate
premium for this insurance also.
Monday, January 4, 2010
Abbreviations used in Medical billing and coding
Abbreviations used in Medical billing and coding
EOB - Explanation of benefits
COB -Co-ordination of Benefits
MSP - Medicare as a Secondary Payer
POS - Place of service
TOS - Type of Service
DOS - Date of service
ICD - 9 -International Statistical Classification of Diseases and Related Health Problems
HCPCS - Healthcare Common Procedure Coding System
CPT - Current procedural Terminology
RBRVS - The Resource Based Relative Value Scale
RVU - Relating Value Unit
CHAMPUS - Civilian Health and Medical Program of the Uniformed Services
CHAMPVA - Civilian Health and Medical Program for the Veteran Administration
EIN - Employer Identification Number
ESRD - End-Stage Renal Disease
FICA - Federal Insurance Contributions Act
HICN - Health Insurance Claim Number
OBRA - The Omnibus Budget Reconciliation Act
CF - conversion factor
EGHP - Employer Group Health Plan
QMB - Qualified Medicare Beneficiaries
UCR - Usual, customary and reasonable
PCP - primary care physician
HMO - Health Maintenance Organization
PPO - Preferred Provider Organization
TPA - Third Party Administrators
EOB - Explanation of benefits
COB -Co-ordination of Benefits
MSP - Medicare as a Secondary Payer
POS - Place of service
TOS - Type of Service
DOS - Date of service
ICD - 9 -International Statistical Classification of Diseases and Related Health Problems
HCPCS - Healthcare Common Procedure Coding System
CPT - Current procedural Terminology
RBRVS - The Resource Based Relative Value Scale
RVU - Relating Value Unit
CHAMPUS - Civilian Health and Medical Program of the Uniformed Services
CHAMPVA - Civilian Health and Medical Program for the Veteran Administration
EIN - Employer Identification Number
ESRD - End-Stage Renal Disease
FICA - Federal Insurance Contributions Act
HICN - Health Insurance Claim Number
OBRA - The Omnibus Budget Reconciliation Act
CF - conversion factor
EGHP - Employer Group Health Plan
QMB - Qualified Medicare Beneficiaries
UCR - Usual, customary and reasonable
PCP - primary care physician
HMO - Health Maintenance Organization
PPO - Preferred Provider Organization
TPA - Third Party Administrators
Tuesday, December 22, 2009
HMO and PPO insurance type - basics for medical billing
Managed Care Plans are operated by private companies, which act as the payer. Examples are Prudential Health Care (an HMO) and Independent Health (a PPO). Physicians sign a contract with a managed care plan to accept the plan’s fee schedule, which is usually lower than the prevailing market rate. The physicians are considered part of a MCO (managed care organization’s panel of providers).
The following are the major managed care plans.
Health Maintenance Organization (HMO):
This is regulated by the State HMO laws. The laws require an HMO to cover benefits for preventive care, which includes routine physician examinations, and other services. Co-ordination of care by a PCP (primary care physician) is required for patients to receive benefits. HMOs also do not provide any benefits for patients unless medical services are provided by contracted physicians. There are two types of payments by HMOs, Capitation and Fee-For-Service. HMOs were the first plan to place the physician’s payment at risk by either Capitation or Withhold. Capitation means HMO’s prepay the doctor for the care of a population assigned to the practice. Withhold means that a certain proportion of the payment due to a physician will be withheld by the HMO (e.g. 10-40%) for a defined period, until the HMO has had time to pay all the claims for that period. If an HMO exceeds its budget for the payment of claims for a period, the withheld money is not paid to the doctor.
Preferred Provider Organization (PPO):
This may or may not be regulated by state insurance laws. It is regulated by State Insurance laws if they are owned by a private insurance plan or the PPO operates within a state, which has an insurance law that regular PPOs. PPOs do not cover preventive benefits unless they are regulated by a state, which requires this. PPOs do not generally require co-ordination of care by a PCP. If a patient seeks services outside the panel of contracted physicians, benefits are reduced and the patient must pay out-of-pocket expenses that usually range from 20-30 % of the total costs. If the PPOs are not owned by a private insurance then they are not the payers. They only act as repricing centers for the payers. They decide the fee-for-service that needs to be paid to the providers and forward them to the insurer for payment.
Third Party Administrators (TPA):
This is an organization which contracts with self-insured employers and other insurance mechanisms to provide administrative methods such as provider contracting, utilization controls, enrollment services and claims processing.
Methods of Payment:
Fee for Service: This is fixed charge for the service performed. Either the doctor or the patient submitted a claim and received payment.
Capitation: This is a fixed pre-paid amount based on the number of patients assigned to a practice for a specified period of time.
Links which are simillar.
The following are the major managed care plans.
Health Maintenance Organization (HMO):
This is regulated by the State HMO laws. The laws require an HMO to cover benefits for preventive care, which includes routine physician examinations, and other services. Co-ordination of care by a PCP (primary care physician) is required for patients to receive benefits. HMOs also do not provide any benefits for patients unless medical services are provided by contracted physicians. There are two types of payments by HMOs, Capitation and Fee-For-Service. HMOs were the first plan to place the physician’s payment at risk by either Capitation or Withhold. Capitation means HMO’s prepay the doctor for the care of a population assigned to the practice. Withhold means that a certain proportion of the payment due to a physician will be withheld by the HMO (e.g. 10-40%) for a defined period, until the HMO has had time to pay all the claims for that period. If an HMO exceeds its budget for the payment of claims for a period, the withheld money is not paid to the doctor.
Preferred Provider Organization (PPO):
This may or may not be regulated by state insurance laws. It is regulated by State Insurance laws if they are owned by a private insurance plan or the PPO operates within a state, which has an insurance law that regular PPOs. PPOs do not cover preventive benefits unless they are regulated by a state, which requires this. PPOs do not generally require co-ordination of care by a PCP. If a patient seeks services outside the panel of contracted physicians, benefits are reduced and the patient must pay out-of-pocket expenses that usually range from 20-30 % of the total costs. If the PPOs are not owned by a private insurance then they are not the payers. They only act as repricing centers for the payers. They decide the fee-for-service that needs to be paid to the providers and forward them to the insurer for payment.
Third Party Administrators (TPA):
This is an organization which contracts with self-insured employers and other insurance mechanisms to provide administrative methods such as provider contracting, utilization controls, enrollment services and claims processing.
Methods of Payment:
Fee for Service: This is fixed charge for the service performed. Either the doctor or the patient submitted a claim and received payment.
Capitation: This is a fixed pre-paid amount based on the number of patients assigned to a practice for a specified period of time.
Links which are simillar.
Monday, December 21, 2009
What are modifiers
What are Modifiers?
Use of Modifiers in medical coding and Billing
What is modifier
Medical codes describe health care procedures performed by doctors in their offices or in hospitals. Codes are most often used to bill insurance companies, and there are rules governing which codes may be used in conjunction with each other. Modifiers are sometimes used in addition to medical codes to allow for billing multiple procedures performed on the same service date. It is important to know which modifiers to use for rules compliance and maximum reimbursement.
Use of Modifiers in medical coding and Billing
What is modifier
Medical codes describe health care procedures performed by doctors in their offices or in hospitals. Codes are most often used to bill insurance companies, and there are rules governing which codes may be used in conjunction with each other. Modifiers are sometimes used in addition to medical codes to allow for billing multiple procedures performed on the same service date. It is important to know which modifiers to use for rules compliance and maximum reimbursement.
Thursday, December 17, 2009
EOB - Explaination of Benefits
What is EOB and its Sample
Definition of EOB (Explaination of benefits)
Explanation of Benefits or EOB is the detailed statement of the carrier’s determination of the claims processed. The determination can result in a payment or a denial.
The Explanation of Benefits contains the following information:
- Name of the payer
- Name of the provider
- Pay-to address
- Name of the patient
- Name of the member
- Member id #,
- date of service
- procedure code
- Billed Amount
- Amount allowed
- co-insurance, deductible
- amount paid by the payer. (the amount paid by the payer is equal to the amount shown by the check. )
Sample of EOB:
Click on EOB Picture to enlarge image size
Definition of EOB (Explaination of benefits)
Explanation of Benefits or EOB is the detailed statement of the carrier’s determination of the claims processed. The determination can result in a payment or a denial.
The Explanation of Benefits contains the following information:
- Name of the payer
- Name of the provider
- Pay-to address
- Name of the patient
- Name of the member
- Member id #,
- date of service
- procedure code
- Billed Amount
- Amount allowed
- co-insurance, deductible
- amount paid by the payer. (the amount paid by the payer is equal to the amount shown by the check. )
Sample of EOB:
Click on EOB Picture to enlarge image size
Clearing House Definition - Benfits and Services
It plays an important role in medical billing process
What exactly does a clearinghouse do? Well, for one thing, they check claims for accuracy. But, the biggest thing they do is re-format the data you send to them to a format that a given carrier can read.
How Clearinghouse Works
The billing software creates the electronic file (the electronic claim), which is then sent to your clearinghouse account thorugh software. The clearinghouse then scrubs the claim checking it for errors and then once the claim is accepted, the clearinghouse securely transmits the electronic file to the specified payer with which it has already established a secure connection that meets the strict standards laid down by a HIPAA.
At this stage, the claim is either accepted or rejected, but either way, a status message is sent back to the clearing house which updates the claim's status in your account. It then alert's you that you have an accepted or rejected claim. If rejected, you have a chance to make the needed corrections and then re-submit the claim. Ultimately assuming there are no other corrections needed and the patient's insurance is valid, you'll receive a reimbursement check along with an explanation of benefits (EOB), all very simple. Not
The same sort of activity takes place every night within the federal banking system as our checks and banking activities are sent electronically from local banks to central ACH repositories (Automated Clearing Houses) and then on to banks of origin across the country, and then back to local banks -- all done electronically, and somewhat instantly.
Thus today, you have dozens of regional medical clearinghouses throughout the country all serving the same role; that of scrubbing claims and then transmitting the claim information securely to insurance carriers electronically.
The best clearinghouses offer added features that provide a whole new level of claim intelligence for revenue cycle management that makes their services extremely compelling from a financial perspective, and as well, highly desirable from an office-staff efficiency point of view.
Clearing House Premium services includes:
- Eligibility Verification
- Electronic Remittance
- Claim Status Reports (Know the status of a claim at all times)
- Rejection Analysis
- Online Access
- Printed Claims - Have non-par claims automatically dropped to paper but
still be able to track them electronically.
- Patient Statement Services
- Support
Main Clearing House Benefits
Here are the main benefits of using a electronic claims clearinghouse
Using an electronic clearinghouse to send claims:
Allows you to catch and fix errors in minutes rather than days or weeks
Results in significantly higher claim success --fewer rejected claims.
Allows you to catch and fix errors in minutes rather than days or weeks.
Results in significantly higher claim success --fewer rejected claims.
Rapid claims processing: Submitting claims electronically can reduce your reimbursement times to under ten days.
Eliminates the need to prepare claims and manually re-key transaction data over and over for each payer.
Submit all your electronic claims in batch all at once, rather than submitting separately to each individual payer.
It provides a single location to manage all your electronic claims
Avoid long hours of being on-hold with Medicare and Blue Cross inquiring about claim errors.
Vastly improve vender relationships with insurance carriers.
If you subscribe to a good clearinghouse, you'll be speaking with a knowledgeable support person within just a few rings.
Shorter payment cycles lead to more accurate revenue forecasts.
Reduce or eliminate need for paper forms, envelopes and stamps.
Plain and simple, using a clearing-house will greatly simplify your claims processing.
Charge Entry Process can be found here
Steps ingvolved in Medical Billing and Coding Process
What exactly does a clearinghouse do? Well, for one thing, they check claims for accuracy. But, the biggest thing they do is re-format the data you send to them to a format that a given carrier can read.
How Clearinghouse Works
The billing software creates the electronic file (the electronic claim), which is then sent to your clearinghouse account thorugh software. The clearinghouse then scrubs the claim checking it for errors and then once the claim is accepted, the clearinghouse securely transmits the electronic file to the specified payer with which it has already established a secure connection that meets the strict standards laid down by a HIPAA.
At this stage, the claim is either accepted or rejected, but either way, a status message is sent back to the clearing house which updates the claim's status in your account. It then alert's you that you have an accepted or rejected claim. If rejected, you have a chance to make the needed corrections and then re-submit the claim. Ultimately assuming there are no other corrections needed and the patient's insurance is valid, you'll receive a reimbursement check along with an explanation of benefits (EOB), all very simple. Not
The same sort of activity takes place every night within the federal banking system as our checks and banking activities are sent electronically from local banks to central ACH repositories (Automated Clearing Houses) and then on to banks of origin across the country, and then back to local banks -- all done electronically, and somewhat instantly.
Thus today, you have dozens of regional medical clearinghouses throughout the country all serving the same role; that of scrubbing claims and then transmitting the claim information securely to insurance carriers electronically.
The best clearinghouses offer added features that provide a whole new level of claim intelligence for revenue cycle management that makes their services extremely compelling from a financial perspective, and as well, highly desirable from an office-staff efficiency point of view.
Clearing House Premium services includes:
- Eligibility Verification
- Electronic Remittance
- Claim Status Reports (Know the status of a claim at all times)
- Rejection Analysis
- Online Access
- Printed Claims - Have non-par claims automatically dropped to paper but
still be able to track them electronically.
- Patient Statement Services
- Support
Main Clearing House Benefits
Here are the main benefits of using a electronic claims clearinghouse
Using an electronic clearinghouse to send claims:
Allows you to catch and fix errors in minutes rather than days or weeks
Results in significantly higher claim success --fewer rejected claims.
Allows you to catch and fix errors in minutes rather than days or weeks.
Results in significantly higher claim success --fewer rejected claims.
Rapid claims processing: Submitting claims electronically can reduce your reimbursement times to under ten days.
Eliminates the need to prepare claims and manually re-key transaction data over and over for each payer.
Submit all your electronic claims in batch all at once, rather than submitting separately to each individual payer.
It provides a single location to manage all your electronic claims
Avoid long hours of being on-hold with Medicare and Blue Cross inquiring about claim errors.
Vastly improve vender relationships with insurance carriers.
If you subscribe to a good clearinghouse, you'll be speaking with a knowledgeable support person within just a few rings.
Shorter payment cycles lead to more accurate revenue forecasts.
Reduce or eliminate need for paper forms, envelopes and stamps.
Plain and simple, using a clearing-house will greatly simplify your claims processing.
Charge Entry Process can be found here
Steps ingvolved in Medical Billing and Coding Process
Medical biller
MEDICAL BILLER
Medical Billers is a responsible job who make sure everyone is being billed correctly. Some of this involves talking with patients and/or health insurance companies on a regular basis to make sure all invoices are paid in a timely fashion. The biller should understand how to read medical invoices and coding language. This is perfect spend time on analyzing invoices and data.
Medical Billing at home is possible but there are many scams which advertise medical billing at home and according to US governemt statistics, only 3% of the medical billers are working at home and earning.
Medical Biller in US earn about $13 to $15 per hour.
Medical Billers is a responsible job who make sure everyone is being billed correctly. Some of this involves talking with patients and/or health insurance companies on a regular basis to make sure all invoices are paid in a timely fashion. The biller should understand how to read medical invoices and coding language. This is perfect spend time on analyzing invoices and data.
Medical Billing at home is possible but there are many scams which advertise medical billing at home and according to US governemt statistics, only 3% of the medical billers are working at home and earning.
Medical Biller in US earn about $13 to $15 per hour.
Medical coder
MEDICAL CODER:
In medical billing, a medical coder is an individual who uses a set of published codes for reporting services provided by a health care provider to an insurer of the recipient of the care
Medical Coders don’t have too much interaction with insurance companies and patients. This job is perfect for someone who would prefer to spend time analyzing and coding data. Every duty performed in a medical office has a particular code assigned to it, and it needs to be coded properly in order for proper billing.
CODER TRAINING:
Medical coding training is necessary in order to perform medical coding understand terminologies. It can be avail from some institute or online.
Few Link which provider medical coding training:
http://www.allalliedhealthschools.com/faqs/medical-coding-career.php
http://www.meditec.com
http://www.ahima.org/medicalcoding/medical_coding_training.asp
In medical billing, a medical coder is an individual who uses a set of published codes for reporting services provided by a health care provider to an insurer of the recipient of the care
Medical Coders don’t have too much interaction with insurance companies and patients. This job is perfect for someone who would prefer to spend time analyzing and coding data. Every duty performed in a medical office has a particular code assigned to it, and it needs to be coded properly in order for proper billing.
CODER TRAINING:
Medical coding training is necessary in order to perform medical coding understand terminologies. It can be avail from some institute or online.
Few Link which provider medical coding training:
http://www.allalliedhealthschools.com/faqs/medical-coding-career.php
http://www.meditec.com
http://www.ahima.org/medicalcoding/medical_coding_training.asp
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