Questions and Answers
The payment category that utilizes a payment based on a fixed amount per member per month (PMPM) is:
Place the following steps in order for patient registration for an upper GI procedure:
1 = Gather demographic data from the patient 2 = Verify that the patient's information is updated and complete 3 = Contact the insurer 4 = Educate the patient about their financial responsibility to pay 5 = Ask how they would like to pay 6 = Collect the payment
Put the following during-visit activities in the correct order:
1 = Provide and document care to the patient 2 = Utilization review 3 = Change capture 4 = Discharge 5 = Medical record completion
Which of the following items might have been an error that resulted in a claim not being paid by the insurer?
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The ______ process the medical record to assign codes that describe the diagnosis of the patient's condition and the procedures performed during the patient visit.
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Which of the following would be an obvious error in coding accuracy?
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The claim for payment (or bill) is referred to as the ______.
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Remittance advice sent from the health plan to the provider explaining the payment decision is also known as the ______.
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The process where the health plan records the claim in its inventory of claims pending processing is known as ______.
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The steps required by the health plan to process the claim for payment is collectively referred to as ______.
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What are the steps in the payment processing?
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Which of the following items would not be needed for Kate to send a clean claim?
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Which of the following would be unimportant in determining why net days in receivables have increased over the past month?
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The combined activities of pre-visit, during-visit, and post-visit are known collectively as the:
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What is part of the process for clean review by a payer?
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Which of the activities below is not a part of the pre-visit portion of the revenue cycle?
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Which of the terms below represent the payer's steps involved in payment processing (claims adjudication)?
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_____ is the intentional deception or misrepresentation of facts for gain. It carries criminal penalties.
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________ involves unintentional actions (errors) that are inconsistent with accepted, sound medical, business or fiscal practices.
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What is the goal of the compliance program?
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What is a chief enforcement vehicle of the federal government that allows the US Department of Health and Human Services to recover monetary damages for false claims?
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Who is someone who discloses information he or she believes evidences violations of law or abuse?
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What law protects patients' health and demographic information?
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What prohibits physician self-referrals for health services to entities with which the physician or their family has a financial relationship?
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What makes it a criminal offense to offer remuneration for referrals?
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Which of the following is NOT a law or regulation with which healthcare entities must comply?
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What term refers to the sources of cash given in working capital management?
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Working capital is the surplus of cash and near-cash items such as accounts receivable over current obligations.
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What represents a potential risk to Prairie Family Care if they accept capitation?
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Which of the following would be a priority for Charles Medical Center in forming a Medicare ACO?
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What is a pre-determined amount that the patient pays before the insurer begins to pay for services?
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What is a percentage of the insurance payment amount that is paid by the patient?
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What is a flat amount that the patient pays at each time of service?
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What payment includes amounts for services that are not included in the patient's benefit design?
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What is the amount payable out of pocket for healthcare services?
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What is the expense incurred to deliver healthcare services to patients?
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What is the amount payable to the provider for services rendered?
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What is the expense related to provided health benefits?
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What does the provider set for services rendered before negotiating any discounts?
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What is the total amount a provider expects to be paid for healthcare services?
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What organization negotiates rates for provider services?
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What entity furnishes a healthcare service?
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What occurs when a healthcare provider bills a patient for charges that exceed the health plan's payment?
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What defines readily available information on the price of healthcare services?
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What is the quality of healthcare service in relation to the total price paid for it?
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What is the flow of money between the patient, the insurer, and the provider?
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What function is one of the most important resource management challenges in today's healthcare industry?
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What term describes payment by an insurer to a healthcare provider after services are rendered?
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What is the term for the price set by a healthcare facility for their services?
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What are the charges by a healthcare facility or physician compiled in?
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What describes a charge-based payment mechanism?
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What does fee-for-service payment provide?
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Why do healthcare facilities set retail prices significantly above rates actually paid?
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What is the use of cost-based payments?
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What is the payment mechanism that has been nearly eliminated from the healthcare industry?
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Which healthcare provider benefits the most from a cost-based payment method?
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What payment method is least effective in stabilizing costs per patient?
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What are the five main types of prospective payments used in today's healthcare market?
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What payment is based on the patient's diagnosis?
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What is the most widely used payment method to healthcare providers?
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What classifies a disease or injury into approximately 750 different categories?
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What defines the increase or decrease adjustment to payment?
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What is the average level of severity of conditions of patients in a healthcare provider during a specified period?
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A _________ pays a specified fee for each procedure performed on a patient.
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What are the two payment approaches used in the per-procedure payment plan?
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What payment approach is similar to the inpatient DRG?
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What payment approach allows physician payment to vary based on resources needed?
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__________ at 100% of the per-procedure fee.
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_________ at 50% of the normal per-procedure fee.
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_________ 25% of the normal per-procedure fee.
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What are the common discounting approaches?
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What must a health plan have in place to control its risk of increased costs?
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What is the predetermined amount paid to a healthcare provider for a specified service?
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What is the difference between case rate and DRG?
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Where is a common area where case rates would be used?
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What payment system is used primarily for long-term care facilities?
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What health plan reimburses a facility a fixed amount per day?
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What are the cons of the per diem system?
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What are the benefits of the per diem system?
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What involves staff from the facility working with the health plan for patient review?
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What is episodic payment in which all services provided are paid as a single rate?
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What are forms of risk-based contracts?
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What aligns the incentives of healthcare providers and physicians?
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What must be in place for acceptable financial results from a per diem payment contract?
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What pays a fixed amount Per Member Per Month to a provider?
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What is the most common in relationships between primary care physicians and managed care plans?
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_________ at 50% of the normal per-procedure fee.
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What is the average level of severity of conditions of patients known as?
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What are examples of risk-based contracts?
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______ _________ contracts overlay a conventional payment methodology with a retrospective settlement mechanism.
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_________ the payer and the provider share financially in both the risks and rewards of healthcare services.
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From the perspective of the medical group, what poses the least financial risk?
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What is the least to greatest risk to healthcare providers?
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What represents the greatest and least financial risk for hospitals?
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What is a payment based on a pre-determined amount for a specified service?
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What is payment based on billed charges or a percentage discount of charges?
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What is payment based on a patient's diagnosis?
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What is payment based on a fixed amount per day?
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Ambulatory Payment Classification (APC) and Resource-Based Relative Value Scale (RBRVS) are both approaches to which type of payment?
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Study Notes
Healthcare Payment Terminology
- Deductible: Pre-determined amount a patient pays before insurance covers services.
- Coinsurance: Percentage of the insurance payment that the patient also pays.
- Copayment: Fixed amount paid by the patient at each service time.
- Out-of-pocket payment: Payment for non-covered services and amounts exceeded by out-of-network providers.
- Cost to the patient: Total patient expenses for healthcare, including deductibles, copayments, and balance-billed amounts not covered by insurance.
- Costs to the provider: Both direct and indirect expenses incurred for delivering healthcare services.
- Cost to the health plan/insurer: Amount reimbursed to the provider for services rendered.
- Cost to the employer: Expenses incurred related to employee healthcare benefits, including premiums and claims.
- Charge: Dollar amount set by a provider before negotiations that may differ from the paid amount.
- Price: Total expected payment for healthcare services from various payers.
Healthcare Providers and Plans
- Health Plan/Payer: Organization negotiating rates, collecting premiums or tax revenues, and processing health claims.
- Provider: Entity or individual delivering healthcare services.
- Balance Billing: Practice of billing patients for charges exceeding the insurance payment—prohibited for in-network but common for out-of-network providers.
Payment Systems in Healthcare
- Price Transparency: Clear access to healthcare service prices, assisting patients in making informed choices.
- Value: Quality of healthcare services measured against total price paid by purchasers.
- Revenue Cycle: Flow of money between patients, insurers, and healthcare providers.
- Billing and Collection: Critical function managing resources between healthcare facilities and insurers.
- Reimbursement: Older term for insurance payment process, now commonly referred to simply as "payment."
Payment Mechanisms
- Fee-for-service: Charge-based system where providers are paid based on the services rendered.
- Cost-based payment: Rarely used now, mainly for critical access hospitals—payment based on actual service costs.
- Prospective Payment Systems (PPS): Fixed payments based on diagnosis or treatment procedures, introduced to control rising healthcare costs.
- Diagnosis Related Group (DRG): Fixed rate payment system based on the patient's diagnosis; flat rate adjusted for severity and resources.
- Per Diem Payment System: Fixed daily rate for care, primarily in long-term care facilities; incentivizes longer patient stays.
- Capitation: Fixed payment per patient per month for comprehensive services, common in primary care and managed care settings.
- Bundled Payment: Single payment covering a range of services provided by multiple providers during an episode of care.
Risk-based Payment Models
- Risk-based contract: Arrangement where providers share in the financial risks and rewards, promoting cost management.
- Shared Savings Programs: Incentivizes providers to reduce healthcare costs while maintaining quality care.
- Value-based payment: Aiming to align providers' incentives toward improving care quality rather than volume.
Coding and Claims Management
- Coding: Process of assigning codes to medical records to describe diagnoses and procedures.
- Errors in claims: Common mistakes include duplicate charges or incorrect coding, which can lead to claim denials.
- Concurrent review: Collaboration between facility staff and health plans for effective patient stay justification.
Payment Security and Incentives
- Utilization Management Program: Essential for controlling costs under per-procedure payment models to ensure medical necessity in services rendered.### Claims and Payment Processing
- Claims for payment are recorded in the ANSI 837 Healthcare Claim Format, known as the 837 record.
- Remittance advice detailing payment decisions is sent via the ANSI 835 Healthcare Claim Payment/Advice, referred to as the 835 record.
- Claim logging occurs when a health plan acknowledges receipt of a claim, typically through electronic acknowledgment.
- Claims adjudication is the process steps required by a health plan to process claims for payment.
- Payment processing steps include claim logging, eligibility verification, adjudication, and remittance issuance.
Revenue Cycle Management
- The combined activities pre-visit, during-visit, and post-visit are collectively known as the revenue cycle.
- The adjudication cycle is the process involved for a payer's clean review of claims.
Compliance and Regulations
- Fraud is the intentional deception or misrepresentation of facts for gain and is subject to criminal penalties with a high burden of proof.
- Abuse refers to unintentional actions inconsistent with accepted practices and carries civil monetary penalties with a lower burden of proof.
- The goal of compliance programs is to prevent fraud and abuse within healthcare practices.
Legal Framework
- The False Claims Act allows the federal government to recover damages up to $11,000 for each false claim.
- Whistleblowers report violations of laws, gross mismanagement, or dangers to public health and safety.
- HIPAA protects patient health information, requiring patient authorization for certain disclosures and limiting information sharing to the minimum necessary.
- Stark I and II prohibit self-referrals by physicians for health services with entities they have a financial relationship with.
- The Anti-Kickback Statute criminalizes the exchange of remuneration to induce referrals.
Financial Management
- Cash is a primary source of working capital management.
- Working capital is the surplus of cash and near-cash items (like accounts receivable) over current obligations, which is crucial for daily operations.
- Prairie Family Care faces potential risks from increased service utilization if they accept capitation from Premier Health Plan.
- Charles Medical Center's priority in forming a Medicare ACO is developing information systems for effective operation.
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Description
Test your knowledge with these flashcards for CHFP Module 1 Certification. The cards cover key insurance terminology such as deductible, coinsurance, and copayment. Perfect for anyone preparing for their certification in healthcare finance.