Medical Billing Facts

Medical Billing Fact: Insurance carriers spend in excess of $19 billion annually processing paper claims.

Fact: Healthcare providers spend more than $7 billion annually just submitting claims to carriers.


Fact: According to the New England Journal of Medicine, the U.S. Healthcare System wastes up to 24 cents out of every dollar on administrative and billing costs, or in excess of $6 billion annually.


Fact: 30 to 35% of all paper claims are rejected due to typo's, errors and omissions.


Fact: Less than 1% of electronic claims are rejected.

 

Medical billing fact An electronic claim takes just seconds to prepare.

Fact: Most electronic claims are processed for payment by carriers within 24 hours.



Fact: Electronic claims cost healthcare providers between $1.50 and $3.00 depending on volume, specialty and other factors.

Fact: Using paper claims submission, reimbursement takes an average of 90 to 120 days.

Fact: Electronic claims are paid within 7-21 days.


Fact: Reports show that the average healthcare provider has more than $150,000 in outstanding accounts receivables.


Fact: Electronic Claims Submission can reduce outstanding accounts receivables by more than 60%.


Fact: Coding errors for surgical procedures eats up about $6 billion annually in unneeded costs.


Fact: Medicare provides healthcare coverage to some 35 million people over age 65.


Fact: The social Security Administration estimated some 2.2 million people turned 65 in the year 2003.


Fact: That number will rise to 4.2 million in the year 2027. In all, 74.9 million people will turn 65 during the next 25 year period, creating a future of opportunity.

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What is ClearingHouse ?

In Medical billing Clearinghouses are a major part of a billing service's ability to conduct business. Your professionalism and reputation depend on aligning yourself with a reputable clearinghouse.


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.


Clearinghouses charge fees in many ways. Some charge an initial start up fee to the billing service ranging from $125 to $300. Others are free to sign-up with initially. Some charge a provider enrollment fee for every healthcare provider you enroll, while others don't. Most of them charge a per claim fee of some sort, depending upon the carrier.


In the last couple of years, clearinghouses have adjusted their fees to the advantage of billing services. Many only charge for Medicare, Medicaid and Blue Cross/Blue Shield claims, while major commercial carrier claims are free in some cases.


If the company you are considering purchasing from is not able to offer you free NEIC claims, you may be able to find a better alternative by obtaining your own claims clearinghouse connection.


If a company tells you they are their own clearinghouse, BEWARE!!! That means you are tied into them, and can't use any other clearinghouse. What happens to you if they go out of business? You'll have to buy new software so you can make your own connection with a different clearinghouse.


These days, you can find a company that offers you many choices in clearinghouses. You may need two or more for medical claims and another for dental claims. The point is, be sure your options are many, not few.

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Useful provider related links

Useful Websites

http://www.upinregistry.com/provider_form.asp

Provider UPIN search Engine



http://www.cms.hhs.gov/NationalProvIdentStand/01_overview.asp

NPI Application online




http://upin.ecare.com/

UPIN numbers are required for insurance billing specifically for referral based practices.
This UPIN Number corresponds with the referring provider.



http://www.healthlink.com/tech_tip_taxonomy_code.asp

Need to know your Taxonomy code? Look it up here!



http://www.upinregistry.com/provider_form.asp

Register your UPIN number and begin the search engine for other provider to access your UPIN number.



http://www.insurance.wa.gov/

Need to contact the Washington State Insurance Commissioner?



http://www.appeallettersonline.com/

Online resource to assist your office in overturning denials, motivating insurers to pay more quickly and preventing denials.

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The Glossary of Insurance and Medical Billing Terms

ICD-9

A 3 to 5-digit number code describing a diagnosis or medical procedure.
Inpatient A patient who is admitted to a hospital and receives medical services from a physician during at least a 24-hour period.

In-Network Provider

Physicians and other service providers who are contracted with a managed care plan.

Out-of-Network Provider

Physicians who are not contracted with a managed care plan.

Outpatient

A patient who receives health care services, but is not admitted to a hospital during a 24-hour period.

Primary Care Physician

A physician, usually a general, family practitioner or internist, who delivers general health care, and is most often the first doctor a patient sees. This physician treats the patient directly, refers them to a specialist (or secondary care physician) or admits them to the hospital.

Provider

A physician, hospital, laboratory, pharmacy or other organization that provides health care, goods or services.

Pre-Certification

Also known as pre-admission certification, is the process of obtaining authorization from the health care plan for routine inpatient and outpatient admissions. Failure to obtain pre-certification may result in penalty to the provider or the subscriber.

Referral Authorization

Approval for a member to see a physician or access services outside of the participating medical group.

Referral Physician

A physician who sees a patient after another doctor has sent them for specialty care or services.

Referring Physician

A physician who sends a patient to another doctor for specialty care or services.

Subscriber

A person who enrolls in a health care plan and agrees to pay for premiums, co-payments and deductibles that are part of the plan.

Treating Physician

A physician who provides care to the patient while in the hospital, and usually works at the hospital or comes in as a specialist.

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UNITED STATES AND ITS CODES

Alabama AL
Alaska AK
American Samoa AS
Arizona AZ
Arkansas AR
California CA
Colorado CO
Connecticut CT
Delaware DE
District of Columbia DC
Federated States of Micronesia FM
Florida FL
Georgia GA
Guam GU
Hawaii HI
Idaho ID
Illinois IL
Indiana IN
Iowa IA
Kansas KS
Kentucky KY
Louisiana LA
Maine ME
Marshall Islands MH
Maryland MD
Massachusetts MA
Michigan MI
Minnesota MN
Mississippi MS
Missouri MO
Montana MT
Nebraska NE
Nevada NV
New Hampshire NH
New Jersey NJ
New Mexico NM
New York NY
North Carolina NC
North Dakota ND
Northern Mariana Islands MP
Ohio OH
Oklahoma OK
Oregon OR
Palau PW
Pennsylvania PA
Puerto Rico PR
Rhode Island RI
South Carolina SC
South Dakota SD
Tennessee TN
Texas TX
Utah UT
Vermont VT
Virgin Islands VI
Virginia VA
Washington WA
West Virginia WV
Wisconsin WI
Wyoming WY
Armed Forces Africa AE
Armed Forces Americas AA
Armed Forces Canada AE
Armed Forces Europe AE
Armed Forces Middle East AE
Armed Forces Pacific AP

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Glossary - Payments

In Medical billing payment related terms are very important for follow up with insurances.

Payments

• Deductible
• Explanation of Benefits (EOB)
• Bundled Payment
• Transaction Control Number (TCN)
• Rejection & Reviews
• Out of Pocket Expenses

Deductible:

The amount of expense an insured must first incur before insurance begins payment for covered services.

Explanation of Benefits (EOB)

After an insurance carrier processed a claim, and the claim is paid, a document known as an Explanation of Benefits is usually issued to the Provider who receives along with a payment check and to the Insured, if the benefits have been assigned. If the claim has not been assigned, payment goes to the patient and the physician may have a difficult time obtaining this payment
In General EOB is also called as

Statement of Benefits
Notice of Payment

EOB is called with different names by different Insurances

Medicare Remittance Advice (Medicare)
Provider Payment Advisory (Blue Shield)
Medex Detailed Advisory (Medex)
Statement of Account (Tufts)
Practitioner Remittance Advice (Medicaid while Primary)
Practitioner Crossover Remittance Advice (Medicaid secondary)
Explanation of Payment (Pilgrim Health)

Bundled Payment:

A single comprehensive payment for a group of related services.
For example,
94760 (NONINVASIVE PULSE OXIMETRY,SINGLE DETERMINATION)94761 (NONINVASIVE PULSE OXIMETRY, MULTIPLE)
In this case, if both the procedures are billed, insurance will pay for 94762 and will deny both 94760 & 94761 as already included in 94762

Transaction Control Number (TCN)

It is a number automated by the system while automatic crossover. If a claim is resubmitted then we need to provide the old TCN and the insurance will again provide a new TCN for the resubmitted claim. Normally, it has to be resubmitted within 2 weeks.

Rejection/Reviews:

Basically, when a claim is submitted, there may be two types of response from the insurance.

a.Denial
b.Payment

Under Denial, it is categorized as Rejections and Reviews only for the purpose of billing office for further follow up.

Rejection:

When an insurance company denies a claim stating that info provided in the claim is not sufficient to process the claim, for which the patient or guarantor is responsible (which can be collected only from them) is called the “Rejection by Insurance”. Eg. Incorrect Ins ID#, Wrong Ins, etc.

Review:

When an insurance company denies a claim stating that it needs additional info for processing, which can be obtained from the Provider’s or billing office can be defined as “Review”. Wrong Procedure or Diag Code, Invalid or Incomplete info on claim etc are some of the examples for review.

Out of Pocket Expense:

Out of Pocket Expense normally refers to the payment made by the insured.
Normally it refers to Both copay and Deductibles.

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Medicare Plan or Part D

Its a program for Prescription drugs. Its not like Part A or Part B. Patient has to pay their own premum to buy this services. Its run by private companies.

All plans will have different costs and benefits from year to year, thus it is advisable for all beneficiaries to consider their options and make the best choice they can.

Coverage and Deductible

The Medicare law establishes a standard Part D drug benefit. Plans must offer a benefit package that is at least as valuable as the standard benefit. The standard benefit is defined in terms of the benefit structure, not the particular drugs that must be covered. In 2009, this standard benefit includes an initial $295 deductible. After meeting the

deductible the beneficiaries pay 25% of the cost of covered Part D prescription drugs, up to an initial coverage limit of $2,700. Once the initial coverage limit is reached, beneficiaries are subject to another deductible, known as the "Donut Hole," or "Coverage Gap," in which they must pay the full costs of drugs.

Covered Drugs.

The MMA defines the drugs that are covered under Part D, and therefore the drugs for which payment will be made under Part D, in relationship to their coverage under Medicaid and under other parts of Medicare. A Part D drug is a drug that is approved by the Food and Drug Administration, for which a prescription is required, and for which payment is required under Medicaid.[6] Biological products, including insulin and insulin supplies, and smoking cessation drugs are also covered under Part D.[7]

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