WK5 ASSIGNMENT HP-214

Please review the lecture information prior to completing this task. This scenario is for a provider who contracts with Medicare. More information is available to you on pages 322-330 of your text.

Health Insurance Calculations – Medicare Participating Provider

Please review the lecture information prior to completing this task. This scenario is for a provider who contracts with Medicare. More information is available to you on pages 322-330 of your text.

Specific tips are:

· Participating provider receives the full amount listed on the Medicare Physician’s Fee Schedule (MPFS or PFS).

· The copay may be paid by the patient or supplemental insurance.

Analyze a scenario to determine monetary responsibility for a visit.

Calculate the figures for each category under both scenarios.

Scenario 1A

Calculate the following amounts for a participating provider who bills Medicare and has no deductible left.

Submitted charge (based on provider’s regular fee)            $650 

Medicare participating physician fee schedule (PFS)          $450

Coinsurance amount (20% paid by)                                     $      

Medicare payment (80 percent of the PFS)                         $      

Provider write-off                                                                  $     

Scenario 1B

Calculate the following amounts for a participating provider who bills Medicare and the remaining annual deductible for the patient.

Submitted charge (based on provider’s regular fee)            $650

Medicare participating physician fee schedule (PFS)          $450

Patient pays $100 remaining on their deductible                  $     

Remaining amount for Insurance and patient to pay            $     

(PFS - $100)

Coinsurance amount (20% of remaining amount)                $      

Total paid by patient (deductible & 20% of remaining)         $      

Medicare payment (80 percent of the remaining amount)   $      

Provider write-off                                                                  

Medicare and Accurate Completion of the CMS-1500

This is the last week that we will be discussing Medicare and the completion of the CMS-1500 claim form in specific terms. Medicare is a federal health insurance program that provides benefits to seniors and those with disabilities and certain illnesses. Medicare has four parts. Part A covers hospitals, nursing facilities, and home health services. Part B covers outpatient services like doctor visits, diagnostic tests, and medical equipment. Part D covers prescription drugs, and Part C, also known as Medicare Advantage, is contracted to private insurance carriers and may offer a variety of additional benefits. While Part A is typically free, Parts B, C, and D come with premiums and deductibles. General Medicare eligibility rules include individuals, or their spouses, who have worked at least 10 years in Medicare-covered employment, who are minimum of 65 years old, and are citizens or permanent residents of the United States. Individuals also qualify for coverage if they are younger than 65 and have a disability or end-stage renal disease (ESRD). The cost for beneficiaries continues to rise slightly in 2020. The standard monthly premium for Medicare Part B enrollees will be $144.60 for 2020 and has a deductible of $198. The Medicare Part A inpatient hospital deductible that beneficiaries will pay when admitted to the hospital will be $1,408 in 2020. The Part A inpatient hospital deductible covers beneficiaries’ share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period.

The forms that we use to bill health insurance carriers were developed by the National Uniform Claim Committee (NUCC) which is led by the American Medical Association (AMA) with assistance from CMS. The CMS-1500, formerly known as the HCFA-1500, was for many years the universal health claim, meaning that it was accepted by most payers. HIPAA now requires electronic transmission of claims except from very small practices and those that never send any kind of electronic health care transactions. Only these providers can still mail or fax paper claims. Electronic transmission of the HIPAA claim is mandated for all other physician practices. The most current version of these forms is the 02/12 form which has been required since October 1, 2014.

The HIPAA-mandated electronic transaction for claims form, or the 837P claim, is based on the CMS-1500 claim, which is a paper claim form. The “P” in 837P stands for professional and because this is the form required for outpatient provider services. There is also an 837I, which is used for Institutions, such as hospitals. The paper counterpart for the 837I form is the UB-04.  The information on the paper claim and on the electronic transaction is essentially the same with a few exceptions. The HIPAA claim contains data elements that are structured in the five major sections of the HIPAA 837 transaction. These five major sections include: provider information; subscriber information; payer information; claim information; and service line information. This claim contains 33 item numbers (INs), or information boxes. Item numbers 1-13 refer to the patient and the patient's insurance coverage. This information is entered based on the patient information form and the patient insurance card. Item numbers 14-33 contain information about the provider and the patient's condition, including diagnoses, procedures, and charges.

Do not be overwhelmed by the idea that there are 33 separate instructions for each of the 33 boxes on these forms. For the most part the instructions have similar guidelines about punctuation and formatting. First, always write everything in CAPITAL letters. Insurance carriers typically use optical character recognition (OCR) to process paper CMS-1500 claim forms. This means that claims will be processed more rapidly, without excessive denials, when the forms are typewritten using black ink and in a font such as Pica 10 or 12-point typeface. Use an ink jet or laser printer rather than a dot matrix, which is more difficult for OCR systems to read. For all claims, both paper and electronic, do not use special characters, (dollar signs, decimals, dashes, asterisk, or backslashes) unless otherwise specified. All identification numbers (social security, NPI, etc.) should be written without spaces or punctuation. As difficult as it may be, because it feels lacking in specificity, do not put decimals in the ICD-10 codes. Also, it is required that the patient’s date of birth (DOB) is written using 8 digits, mm dd yyyy, with a space between month, day, and year. It is also required that the rest of the dates are consistently written as either 6 or 8-digit, but not a mix of the two. It simplifies instructions if you just choose to always use the 8-digit formatting throughout the claim form. The rest of the instructions are straightforward with the exception of how to handle claims where the provider is not a physician.

Non-physician providers (NPP), such as Physician’s Assistants (PAs) and Nurse Practitioners (NPs), can bill under their own names and NPI and receive 85 percent of the Medicare physician fee schedule (MPFS) rate. But physicians often work with NPPs on an incident-to basis. That permits the practice to bill for services provided by an NPP and supervised by a physician at the full MPFS rate, as if the physician personally performed the service. Effectively using incident-to rules can allow a practice to enhance revenues by ensuring that much of the NPP's time rendering services is billed at a higher rate and is increasing the range of services the practice offers. To qualify for incident-to designation, the services must meet certain requirements. Some requirements include:

·       Must relate to a service initially performed by the physician.

·       Must be performed under direct supervision – when the physician is in the office suite/building.

·       Cannot be billed when more than 50 percent of the visit is for counseling or care coordination.

These specific requirements only apply to Medicare, but some private insurance plans allow incident-to billing using similar rules. When billing an incident-to scenario, the supervising physician will be listed in box 17 with the NPP listed in box 24J.

It is highly recommended that you print out and use the NUCC instruction booklet (included under assigned reading). There are high-lighted areas within the booklet. You can add extra notes for Medicare and additional insurance types when we cover them in weeks 6-8.

The following information is designed to help you to understand and complete the assignment scenarios found this week through the end of the course. We talked about the insurance terms that are most important when billing. There was an emphasis on a provider who was in “network”, or a “participating provider.” If a provider participates with an insurance carrier, they have a written contract agreeing that they will accept the allowed amount, as determined by the insurance carrier. We are now going to add to that concept by addressing non-participating providers who may, or may not, agree to accept assignment. Essentially, “assignment” means that a provider, or supplier, agrees to accept an insurance-approved amount as full payment for covered services.

If a provider does not have a contractual agreement and does not wish to accept what the insurance carrier allows, they are a “non-participating provider” who does not “accept assignment”. It is important to note that a provider who does not participate can still opt to accept assignment on just a particular claim or for specific services. This later provider is called a “non-participating provider” who “accepts assignment”. These terms become very important when determining the financial responsibilities for the patient, insurance carrier and the provider.