October 17, 2017

 
Payment

 Insurers 

If a "deny claim letter" is to be generated and sent out, this is the place. Below is a survey of some of the places where things may have gone off the rails. If you receive a denial that you can't understand by reading the remark code, it is sometimes helpful to look at the steps below and try to isolate where the bad information may have been introduced to cause this less-than-satisfactory result. Then, when you call customer service, if you can inform them of your theory - and where you think their company messed up - they'll know that you know what your talking about and pay the claim. Anyway, this is what's taking place at this late stage in the process 
 
Auto-adjudication  The health insurer establishes the final payment of the claim this way: Once the accuracy of the data fields is complete, the claim is reviewed to verify that it is consistent with the health insurer rules and procedures, it is not a duplicate, it is a covered benefit, and all required information is available to process the claim completely in lieu of a deny claim letter .
 
The insurer auto-adjudicates the claim by individual lines, not the total claim. This method is how the insurer is able to downcode, bundle or otherwise adjust individual line items. Payment rules and policies vary from insurer to insurer. They might arbitrarily change and inconsistently apply these rules and often don't provide easily accessible reimbursement and coverage policies. Additionally, they may misapply or misunderstand CPT and ICD-9 codes and guidelines. This is all further complicated by the fact that over the years, health insurance claims adjudication has become more complex as a result of the introduction of new technology. This frequently translates into extended processing time and delayed payments to physicians.
 
When a claim is denied, it is usually the result of: 
If the health insurer approves the claim, payment is queued into a payment register for remittance in the next payment run. During the check run, the check is cut and mailed to the practice along with a paper EOB/RA. (EFT) deposit directly into the practice bank account. In the case of electronic remittances, the insurer sends it to a clearinghouse, and this may accompany a paper check or an electronic funds transfer.
 
EOB/RA Generated  The practice uses the information from the EOB's/RA's to process and post payments and adjustments to a patient's account. Once the EOB/RA has been evaluated for accuracy and to detract processing errors, the claim is posted. Then billing staff follows up with health insurers for erroneous denials, partial payments,  downcoding, bundling, payments made after the state required time limits and other considerations. Every EOB/RA is reviewed in this manner to ensure that contracted allowed amounts are applied and paid appropriately. If they are not, the practice's appeal protocol begins in lieu of a deny claim letter . 
 
HIPAA"s Administrative Simplification Transaction and Code Sets Final Rule established guidelines requiring health insurers to use standardized reason codes as part of claim payments. This national administrative code set identifies the reasons for any differences and adjustments between the original physician's charge for a service and the health insurer's remittance.
 
Payment Sent  Electronic funds transfer is a prevalent payment method to route monies between parties today. It can be nearly instantaneous and may reduce administrative steps associated with issuing and depositing payments. The electronic EOB is known as an X12 835There are many ways health insurers can combine the X12 835 and the actual payment. They may forward an EOB/RA with an a check or they may transfer payment through a depository financial institution (DFI). Regardless of the method of payment receipt, the amount and remittance information are reviewed for consistency with the insurer contract.
 
In summary, if the health insurer approves the claim, a check is cut and delivered to the practice. If they partially pay the claim, the check and the EOB/RA are forwarded with remark codes that provide the rationale for the partial payment. The insurer also forwards an EOB/RA to the insured person. If the health insurer denies the claim, they return the denied claim to the provider with a zero remittance EOB/RA
 
  
  
Providers

Whether medical claims are billed electronically or paper billed by mail, medical office staff follows-up with the insurance carriers to obtain claim status.Once the bill has been received by the insurance company, payment can be expected in as little as 15 days depending on the billing method . Following up on the status of claims not received in this time frame can definitely improve how accounts receivables are looking. Developing the policy below can help guarantee that claims are  paid quickly. 

Claim Follow Up  Practices submit claims electronically nowadays because it can reduce the time administrative staff  would otherwise need for the claims follow-up process in lieu of a deny claim letter. The claims clearinghouse or insurer will usually confirm whether or not it successfully received the claims and has them on file. After a pre-determined time, staff responsible for handling the collection function implements claims follow-up procedures to confirm that the insurer has processed them.

Before assigning staff, there are different types of claims that have been submitted Which staff member has the right expertise to effectively get the claim paid? Consider all of the practice staff and not just the billing team as individuals who can track a claim. With the efficient functionality of electronic work files, assign work files to different staff throughout the practice and monitor their progress day to day.
 
Processing RAs/EOBs An RA/EOB repeats the unique claim control number that the provider assigned to the claim when sending it. This number is the resource needed to match the payment to a claim. To process the RA/EOB, each claim is located in the practice management program (PMP)—either manually or automatically by the computer system. The remittance data are reviewed and then posted to the PMP.
 
This procedure is followed to double-check the remittance data:
 
1. Check the patient’s name, account number, insurance number, and date of service against the claim.
2. Verify that all billed CPT codes are listed.
3. Check the payment for each CPT against the expected amount, which may be an allowed amount or a percentage of the usual fee. Many practice management programs build records of the amount each payer has paid for each CPT code as the data are entered. When another RA/EOB payment for the same CPT is posted, the program highlights any discrepancy for review.
4. Analyze the payer’s adjustment codes to locate all unpaid, downcoded, or denied claims for closer review.
5. Decide whether any items on the RA/EOB need clarifying with the payer, and follow up as necessary.
 
Procedures for Posting Many practices that receive RAs/EOBs authorize the payer to provide an electronic funds transfer (EFT) of the payment. Payments are deposited directly into the practice’s bank account. Otherwise, the payer sends a check to the practice, and the check is taken to the practice’s bank for deposit.
 
Posting and Applying Payments and Adjustments Payment and adjustment transactions are entered in the practice management program. The data entry includes:
 
• Date of deposit.
• Payer name and type.
• Check or EFT number.
• Total payment amount.
• Amount to be applied to each patient’s account, including type of payment. Codes are used for payments, adjustments, deductibles, and the like.
 
Some PMPs have an autoposting feature. Instead of posting payments manually, this feature automatically posts the payment data in the RA/EOB to the correct account. The software allows the user to establish posting rules, such as “post a payment automatically only if the claim is paid at 100 percent,” so that the medical insurance specialist can examine claims that are not paid as expected. Finally, The process of reconciliation means making sure that the totals on the RA/EOB check out mathematically. The total amount billed minus the adjustments (such as for allowed amounts and patient responsibility to pay) should equal the total amount paid.
  
Deconstruct Denials When staff sits down to actually work claim denials, it is immediately a complex process that requires considerable knowledge.  Medical groups want experienced staff to work denied claims using established denial management strategies.  Due to payer denial deadlines, these strategies must consider speed and efficiency or appealing denials that have already passed the appeal deadline may be pursued thus using expensive resources for no potential financial return. Let’s discuss one of the most common denials:   
 
Duplicate Claims The EOB remark indicates payer has received another claim for the same service and the denial reads “duplicate claim” or “previously paid”.  However, the claim may not be a true duplicate for the following reasons:
 
  • Same CPT code/procedure was performed more than once on same date of service (two chest x-rays)
  • Same CPT code/procedure was performed more than once by a physician in the same medical group (same tax identification number) on the same date of service (two specialists in the same multispecialty group)
  • Payer’s computer system does not read modifiers as submitted on claim in their adjudication system.
 
For these reasons, staff cannot just adjust off claims as duplicates because the denial may not be accurate.  The staff member needs to review the patient’s account to identify the potential reason for the duplicate denial and then take action based on that.  Developing a decision tree tool for staff to refer to when working duplicates may be the answer.  For example, if they find that there were two chest x-rays on the same day; then they review the claim submitted to see if it was coded appropriately and if not, they will correct it and resubmit it.  If it was coded correctly, they will follow the payer’s appeal process to communicate to the payer that the claim is payable for the following reasons.



           Related Resources:
 
 

 
   
Bob Schieffer interviews Donna Smith from the Nurses Association and Robert Zerkilbach of America's Health Insurance Plan (AHIP) on a new report on insurance claims. One out of five received a deny claim letter in California. The weasel from AHIP tries to spin it (big surprise that) saying it's 3% - 4% to little or no avail. 

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