BUSI 323
KAITLYN HOLDER
HOMEWORK: BILLING AND CODING ASSIGNMENT INSTRUCTIONS
OVERVIEW
The homework assignment will contain a variety of short answer and essay questions focusing
on various theories/topics., assessing students’ recollection, understanding, and analysis of the
material covered.
INSTRUCTIONS
Chapters 2–3
1. A hospital submitting an outpatient claim would use a UB-04 claim form. What source of
coding information is used to report diagnosis codes? What source of coding information
is used to report procedures?
ICD-10-CM is used for diagnosis code reporting. HCPCS is used for procedure reporting.
2. What are the primary uses of financial information?
Evaluating financial condition of an entity, evaluating stewardship withing an entity, assessing
the efficiency of operations, assessing the effectiveness of operations, and determining the
compliance of operation with directives.
3. Is profit maximization the same thing as shareholder wealth maximization?
No, the first is about short term and the second is about long term.
4. What are the objectives of not-for-profit (NFP) firms?
The objective of not-for-profit firms is to serve its community with its healthcare services. This
can be through unconmpensated care, settings lower prices, or offering some services that a for-
profit organization might not consider worth while.
5. What are social responsibility and ethics as they relate to business-oriented
organizations? How should social responsibility and ethics affect the decisions of even
for-profit companies?
The social responsibility is a businesses ability to contribute to society in a positive way. Ethics
in relation to a business-oriented organization is a businesses foundation and what it is in support
of and how it contributes to the things it supports. Both should be used to have a positive effect
on a businesses consumer pool and the industry.
6. What is the main difference between the fee-for-service and capitation reimbursement
methods?
With fee-for-service it is essentially what it is called, providers will profit based upon services
rendered, where as with capitation there is a standard amount that is paid out per patient
regardless.
7. For the following problems (as applicable), assume that the Medicare/patient split of
payments is as covered in the book. Assume that the participating/non-participating and
maximum allowable charge are as covered in the book. Ignore the patient's annual
deductible. Use the following information to answer the question. Dr. Melissa Rose is
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BUSI 323
trying to decide whether to be a Medicare-participating physician for the upcoming year.
(Assume that her entire practice consists of Medicare patients or at least that her practice
has slack capacity. Her Medicare patients do not displace non-Medicare patients.)
Assume that her average charge is $120 (before Medicare's limiting charge is applied),
for which the average Medicare-approved amount is $100. If she decides to be a non-
participating physician, she expects to accept assignment 80% of the time. For the
unassigned patients, assume that she would set her charges at 110% of the Medicare-
approved fee for a nonparticipating physician. Assume that her Medicare patient volume
is not reduced if she chooses not to participate nor if she does not accept assignment.
(Ignore bad debt and any other factors not presented here.)
Case Study: What will be Dr. Rose's average reimbursement per visit if she chooses to
be a Medicare-participating physician? (This is the total from both Medicare and the
patients.)
If Medicare is 80% of $100 = Then it would be $80 from Medicare. If the patient is 20%
of $120 = then it would be $24 from patient. The total provider reimbursement would be
$104.
8. For the following problems (as applicable), assume that the Medicare/patient split of
payments is as covered in the book. Assume that the participating/non-participating and
maximum allowable charge are as covered in the book. Ignore the patient's annual
deductible. Use the following information to answer the question. Dr. Melissa Rose is
trying to decide whether to be a Medicare-participating physician for the upcoming year.
(Assume that her entire practice consists of Medicare patients or at least that her practice
has slack capacity. Her Medicare patients do not displace non-Medicare patients.)
Assume that her average charge is $120 (before Medicare's limiting charge is applied),
for which the average Medicare-approved amount is $100. If she decides to be a non-
participating physician, she expects to accept assignment 80% of the time. For the
unassigned patients assume that she would set her charges at 110% of the Medicare-
approved fee for a nonparticipating physician. Assume that her Medicare patient volume
is not reduced if she chooses not to participate nor if she does not accept assignment.
(Ignore bad debt and any other factors not presented here.)
Case Study: Based strictly on the information presented here (ignore bad debt, patient
mix differences, and other considerations not presented here), should she choose to be
participating or non-participating if she wishes to maximize her total reimbursement for
services?
Based on just the information presented here, the better choice between the two would be
a non-participating physician since a non-participating physician can charge more
allowing the provider to collect the remainder of the amount Medicare doesn’t pay from
the patient.
9. A non-participating physician provides services to a Medicare patient who has total
charges of $100 (before Medicare's limiting charge is applied). The physician does not
accept assignment, charges the maximum allowable, and submits the claim to Medicare.
Assume Medicare's approved schedule for these services is $80. What is the Medicare
portion of the physician payment (which Medicare sends to the patient)? What is the
patient's portion of the payment to the physician (net of the reimbursement from
Medicare)?
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BUSI 323
If medicare is at 80% of $95 = then it would be $76 from Medicare. If the patient pays
20% of the cost at $95 = it would be $19 from the patient. Then the total reimbursement
is $95.
Answer the questions above and submit the Microsoft Word document to Canvas.
Note: Your assignment will be checked for originality via the Turnitin plagiarism tool.
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