Preadmission is gathering information and taking care of as many items as possible prior to the date of service. Preadmission reduces patient waiting time on the day of the appointment and improves accuracy. It allows more time to verify benefits and to prepare patients for their financial obligations. With preadmission, precertification requirements can be met and clinical work can be arranged in advance, resulting in better patient care. Finally, room requirements can be anticipated in advance.

Precertification or preauthorization is obtaining advance insurance approval in order to secure payment later. The responsibility rests on different parties (patient, physician, Case Management, etc.) in different situations, and the requirements can vary widely depending on the type of service. Therefore, procedures must be in place to assure that the necessary steps have been followed.

An effective process requires:

• adequate staffing, guidelines, procedures, and training
• Adequate time prior to admission
• A smooth process between Case Management and Patient Access
• Appropriate discharge practices so inpatient days are not denied

• Centralized registration genrally offers easier staff scheduling, coverage, training, and communication; more supervision and better quality control; and less risk of staff pulled to out-of-scope tasks.
• Decentralized registration generally offers shorter wait times, more focus on unique patient needs, and greater customer satisfaction.

• Obtaining complete and accurate demographic information
• Obtaining complete insurance information
• Verifying all applicable insurance benefits
• Identifying the need for a referral/authorization
• Identifying uninsured individuals

Financial Counselors may:

• Notify the patient of financial responsibility
• Collect patient deductibles and copayments
• Make payment arrangements
• Review outstanding patient debts with hospital
• Identify potential third party resources
• Complete and/or make referrals for government programs
• Assess patients for ability to pay and/or charity care guidelines
• Collect appropriate signatures
• Participate in the discharge process and work with patients afterwards

Because asking for money can be unconfortable, it is important to provide training in dealing with the objections.

Patients will be reluctant to pay unless they feel the estimates are credible. Therefore, estimates must be based on actual insurance verification and take into account any insurance discount. Providers can purchase software or develop their own in-house tool to assist with the estimates.

• Use an online verification tool
• Ask the patient
• Call the insurance company for verification

Patient Access staff must receive education on fraud and abuse issues both during their initial training period and continuously. This education is important because Patient Access has a key role in a compliant billing process. The information entered during registration affects many other areas and much of the data appears on the claim. Incorrect demographics can lead to fraudulent or abusive bills.

The important Message from Medicare explains to inpatients what to do if they feel they are being discharged too soon. It protects them from financial liability until they have had a chance to appeal. It is required to be issued within two days of admission and again within two days of discharge.

Case management is often called UR or Utilization Review.

Functions include:

• Preventing unnecessary services or treatment
• Evaluating an individual's safety and ability to live independently
• Obtaining appropriate medical care
• Securing necessary medical supplies and equiptment
• Obtaining home care nursing services
• Obtaining assistance with homemaking, personal care, and errands
• Coordinating healthcare service delivery and medical follow-up
• Arranging for transportation to and from doctors appointments

• Identify uninsured patient prior to admission
• Gather accurate demographic and billing information
• Provide financial counseling at the time of registration
• Work with physician's office to reschedule elective admissions
• Make payment arrangements with patient or guarantor prior to discharge
• Screen for repeat bad debt patients
• Explain payment programs and collection policy to patients or guarantor
• Identify potential charity cases
• Meet with guarantor or relative in emergency cases
• Meet with patient in room
• Qualify patients for government assistance
• Request deposits for deductibles and coinsurance amounts
• Work with the Social Services and Case Management departments to meet patient prior to discharge

1. Prior to services
2. At admission / registration
3. During the stay
4. At discharge / the end of the visit
5. After discharge / the appointment

• Patient presents to the ER - If the admission is emergent, allow it and make financial arrangements as soon as possible
• Patient's doctor refers him or her for direct admission - If the admission is urgent, contact the physician to determine if it could be delayed in order to make financial arrangements and contact the patient/family as soon as possible.
• Patient is scheduled for elective service - If the admission is elective, delay or cancel it until financial arrangements are completed and notify the physician.

• Acupuncture
• Applicable deductibles, coinsurance, or copayments
• Dental care and dentures (in most cases)
• Cosmetic surgery
• Custodial care (help with bathing, dressing, toileting, and eating) at home or in a nursing home
• Healthcare while traveling outside of the United States (except in limited cases)
• Hearing aids
• Orthopedic Shoes (only with a few exceptions)
• Outpatient prescription drugs (with only a few exceptions)
• Routine foot care (with only a few exceptions)
• Routine eye care and eyeglasses except following cataract surgery
• Routine yearly physical exams (besides the IPPE, when applicable)
• Screening tests, except those listed
• Vaccinations, except those listed
• Some diabetic supplies (like syringes or insulin, unless its with an insulin pump)
• The monthly Part B premium

What is the best way to handle a late charge posted in each of the following timeframes?

1. After DOS but before bill drops
2. After lag days have passed
3. After the bill has dropped

1. After DOS but before bill drops - No follow up or action should be required since the account has not yet been final billed.
2. After lag days have passed - Account should be reviewed to determine if the charges will bill correctly when the account does final bill. Action may or may not be required.
3. After the bill has dropped - Account should be reviewed. A corrected claim will need to be submitted to the insurance carrier.

CCI edits apply to physician services under the Medicare Physician Fee Schedule. OCE edits apply to hospital outpatient services under the OPPS.

The end result of these edits is that some pairs of codes cannot be billed together, and some pairs can only be billed with modifiers to indicate unusual circumstances. In addition, the edits look for things that don't make sense based on standard anatomy.

The POA indicator is paired with each diagnosis code in the medical record to help identifiable non-payable complications such as hospital-acquired infections, sponges left in patients, and so on.

What is a brief description for each of the following types of Medicare denials?

1. RTP File
2. Line-item rejection
3. Claim rejection
4. Claim suspension

1. RTP File - An error exists that does not pass Medicare's front end edits; the billing team needs to review the claim, correct the information, and resend the UB.
2. Line-item rejection - One line of the UB claim is rejected; the billing team is allowed to correct and resubmit the claim, but not to appeal the line rejection.
3. Claim rejection - The entire claim is rejected; the billing team is allowed to correct  and resubmit the claim, but not to appeal the claim rejection.
4. Claim suspension - The claim is suspended within the Medicare system for medical review or another reason; the claim does not hit the RTP file.

1. Redetermination - within 120 days of the initial decision
2. Reconsideration - within 180 days relevant of the receipt of redetermination
3. Administrative Law Judge - within 60 days from the date of receript of the reconsideration
4. Review by the Medicare Appeals Council - within 60 days from the receipt of the ALJ hearing decision
5. Judicial Review by the Federal District Court - within 60 days from the date of receipt of the Medicare Appeals Council decision or declination of the review

• Maintain cash flow
• Reduce AR days
• Reduce turnaround time
• Reduce duplicate claims
• Maintain compliance with managed care contracts
• Identify and address issues with particular payers

From the following information, determine tge expected payer reimbursement. Also determine the amount owed by the patient. Be sure to show your work.

• Total Bill - $12,000
• Noncovered charges - $400
• Unmet deductible - $350
• Coverage percentage - 80%
• Out-of-pocket maximum (excluding deductible) - $1,000

Payer Reimbursement:

• Covered charges ($12,000 - $400) = $11,600
• Less unmet deductible ($11,600 - $350) = $11,250
• Reimbursement Rate ($11,250 * 0.80) = $9,000

Out-of-pocket calculation:

• Coinsurance ($11,250 * 0.20) = $2,250
• Less out-of-pocket maximum ($2,250 - $1,000) = $1,250)

Total Payer Reimbursement ($9,000 + $1,250) = $10,250

Patient Obligation:

• Noncovered Charges - $400
• Unmet deductible - $350
• Out-of-pocket maximum - $1,000

Total Patient payment Amount ($400 + $350 +$1,000) = $1,750

Everyone involved in preparing and billing claims should receieve frequent education. Sources include local MACs and AAHAM. Computer systems should be set up so that information flows accutrately from place to place, with edits along the way to catch errors. Bilelrs should never change codes without direction from the responsible department. Any problem that occurs repeatedly should be investigated and fixed.

• Supervise billing staff; provide on-going education and mentoring
• Monitor new payer / regulatory requirements
• Monitor benchmarks, including claims follow-up targets
• Assess billing system inputs, performance, and edits
• Monitor delayed billing reports
• Support strong hospital-physician relationships

• Admission policy
• Expectations for collecting at time of service
• Means for determining a patient's financial need
• Guidelines for discounts and charity care
• Acceptable methods of payment
• Minimum acceptable payments
• Charges for returned checks, missing appointments without cancelling, etc.
• Follow-up parameters
• Methods to identify uncollectible accounts

• Advantages: immediate assurance of payment; installment payments sometimes made more redily; method to accept phone payments; ability to get prior authorization to charge balance after insurance payment.
• Disadvantages: additional costs; potentially more paperwork; potentially public relations problem.

• patient accounting system
• post office
• internet sites
• credit reports
• employers
• previous employers
• neighbors
• relatives

Total recovered - Total (contingency or flat) Fees =

Net Recovery

Bad Debt - Bad Debt Recovery = Net Bad Debt

Gross Revenue - Allowances/Discounts - Charity - Bad Debt - Other Non-Cash Deductions = Net Revenue

Net Bad Debt / Net Revenue = Net Bad Debt Percentage

Personnel + Sysyems + Statements = Total Costs to Collect

Medicare + Medicaid + Insurance + Patients = Total Received

Total Costs to Collect / Total Received = Cost to Collect

Managers must carefully consider any potential incentive plan. An effective plan should improve production, morale, and motivation among employees who are able to participate and who are sucessful. Sucess should also yield increased cash collection.

However, an ineffective plan could be a negative experience for employees who are not sucessful or cannot participate. Without careful training/monitoring, employees could become too aggressive in their collection practices, triggering negative public reactions.

• Ensure that staff is properly trained, scheduled, and assigned.
• Create and/or monitor policies for operations
• Emphasize collection at time of service and offer discounts for prompt payment
• Prioritize billing and follow-up for large dollar accounts and fast payers; consider outsourcing smaller or older accounts
• Monitor unbilled claims; when a backlog becomes extreme, devise a plan with both short- and long-term solutions.
• Minimize bill hold days
• Minimize accounts that are DNFB

Total Daily Revenue / Number of Days = Average Daily Revenue

Total AR / Average Daily Revenue = Gross AR Days

Total Daily Revenue - Total Charity - Bad Debt - Total Contractual Allowances = Total Net Daily Revenue

Total Net Daily Revenue / Number of Days = Average Net Daily Revenue

Total AR / Average Daily Revenue = Net AR Days

• Overpayment by third party payer or patient (guarantor)
• Miscalculation of contractual allowance
• Not following COB protocols
• Improper posting of payment
• Patient payment or adjustment applied to wrong account
• Duplicate payment, charge credit

1. Offer
2. Acceptance
3. Consideration
4. Legal Purpose
5. Mutuality
6. Competence

• Authorization and referral requirements
• Coordination of benefits
• Clean claim definition
• Timely filing limits
• Prompt payment incentitives
• Payer deduction rate
• Remmittance advice
• Audit requirements
• Denial attachments/billing requirements
• Appeal processing
• Dispute resolution
• Catastrophic protection; stop loss
• Payment default or bankruptcy provisions
• Credentialing requirements
• Reimbursement methodologies for payment posting auditing
• Overpayment policy
• Refund policy
• Contract renewal and termination requirements

1. Automated: the RAC identifies a potential issue, uses its database to find improper payments, and notifies the provider of denied claims.
2. Complex: the RAC requests medical records from the provider and makes its determination from them
3. Prepayment: the RAC reviews claims prior to Medicare payment (as part of a demonstration project starting in 2012)