CHFP Module 1 Certification Test Flashcards
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Questions and Answers

The payment category that utilizes a payment based on a fixed amount per member per month (PMPM) is:

  • Bundled payments
  • Fee-for-service
  • Capitation (correct)
  • Per diem

    • 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?

    <p>There were duplicate E&amp;M charges on the claim</p> Signup and view all the answers

    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.

    <p>coding</p> Signup and view all the answers

    Which of the following would be an obvious error in coding accuracy?

    <p>Showing a hysterectomy for a male patient</p> Signup and view all the answers

    The claim for payment (or bill) is referred to as the ______.

    <p>ANSI 837 Healthcare Claim Format</p> Signup and view all the answers

    Remittance advice sent from the health plan to the provider explaining the payment decision is also known as the ______.

    <p>ANSI 835 Healthcare Claim Payment/Advice</p> Signup and view all the answers

    The process where the health plan records the claim in its inventory of claims pending processing is known as ______.

    <p>claim logging</p> Signup and view all the answers

    The steps required by the health plan to process the claim for payment is collectively referred to as ______.

    <p>claims adjudication</p> Signup and view all the answers

    What are the steps in the payment processing?

    <p>Claim logging, eligibility, adjudication, remittance</p> Signup and view all the answers

    Which of the following items would not be needed for Kate to send a clean claim?

    <p>Copies of the patient's previous medical records</p> Signup and view all the answers

    Which of the following would be unimportant in determining why net days in receivables have increased over the past month?

    <p>The amount of time required for a new patient to get an appointment</p> Signup and view all the answers

    The combined activities of pre-visit, during-visit, and post-visit are known collectively as the:

    <p>Revenue cycle</p> Signup and view all the answers

    What is part of the process for clean review by a payer?

    <p>Adjudication cycle</p> Signup and view all the answers

    Which of the activities below is not a part of the pre-visit portion of the revenue cycle?

    <p>Coding</p> Signup and view all the answers

    Which of the terms below represent the payer's steps involved in payment processing (claims adjudication)?

    <p>Claims logging, eligibility, adjudication, remittance</p> Signup and view all the answers

    _____ is the intentional deception or misrepresentation of facts for gain. It carries criminal penalties.

    <p>Fraud</p> Signup and view all the answers

    ________ involves unintentional actions (errors) that are inconsistent with accepted, sound medical, business or fiscal practices.

    <p>Abuse</p> Signup and view all the answers

    What is the goal of the compliance program?

    <p>To prevent fraud and abuse</p> Signup and view all the answers

    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?

    <p>False Claim Act</p> Signup and view all the answers

    Who is someone who discloses information he or she believes evidences violations of law or abuse?

    <p>Whistleblower</p> Signup and view all the answers

    What law protects patients' health and demographic information?

    <p>HIPAA</p> Signup and view all the answers

    What prohibits physician self-referrals for health services to entities with which the physician or their family has a financial relationship?

    <p>Stark I and II</p> Signup and view all the answers

    What makes it a criminal offense to offer remuneration for referrals?

    <p>Anti-Kickback Statute</p> Signup and view all the answers

    Which of the following is NOT a law or regulation with which healthcare entities must comply?

    <p>CHIP</p> Signup and view all the answers

    What term refers to the sources of cash given in working capital management?

    <p>Cash</p> Signup and view all the answers

    Working capital is the surplus of cash and near-cash items such as accounts receivable over current obligations.

    <p>Working capital management</p> Signup and view all the answers

    What represents a potential risk to Prairie Family Care if they accept capitation?

    <p>Potential losses from increases in service utilization</p> Signup and view all the answers

    Which of the following would be a priority for Charles Medical Center in forming a Medicare ACO?

    <p>Develop information systems</p> Signup and view all the answers

    What is a pre-determined amount that the patient pays before the insurer begins to pay for services?

    <p>deductible</p> Signup and view all the answers

    What is a percentage of the insurance payment amount that is paid by the patient?

    <p>coinsurance</p> Signup and view all the answers

    What is a flat amount that the patient pays at each time of service?

    <p>copayment</p> Signup and view all the answers

    What payment includes amounts for services that are not included in the patient's benefit design?

    <p>Out-of-pocket payment</p> Signup and view all the answers

    What is the amount payable out of pocket for healthcare services?

    <p>Cost (to the patient)</p> Signup and view all the answers

    What is the expense incurred to deliver healthcare services to patients?

    <p>Costs (to the provider)</p> Signup and view all the answers

    What is the amount payable to the provider for services rendered?

    <p>Cost (to the health plan/insurer)</p> Signup and view all the answers

    What is the expense related to provided health benefits?

    <p>Cost (to the employer)</p> Signup and view all the answers

    What does the provider set for services rendered before negotiating any discounts?

    <p>Charge</p> Signup and view all the answers

    What is the total amount a provider expects to be paid for healthcare services?

    <p>Price</p> Signup and view all the answers

    What organization negotiates rates for provider services?

    <p>Health Plan/Payer</p> Signup and view all the answers

    What entity furnishes a healthcare service?

    <p>Provider</p> Signup and view all the answers

    What occurs when a healthcare provider bills a patient for charges that exceed the health plan's payment?

    <p>Balance Billing</p> Signup and view all the answers

    What defines readily available information on the price of healthcare services?

    <p>Price Transparency</p> Signup and view all the answers

    What is the quality of healthcare service in relation to the total price paid for it?

    <p>Value</p> Signup and view all the answers

    What is the flow of money between the patient, the insurer, and the provider?

    <p>Revenue Cycle</p> Signup and view all the answers

    What function is one of the most important resource management challenges in today's healthcare industry?

    <p>Billing and Collection</p> Signup and view all the answers

    What term describes payment by an insurer to a healthcare provider after services are rendered?

    <p>Reimbursement</p> Signup and view all the answers

    What is the term for the price set by a healthcare facility for their services?

    <p>Charges or Billed Charges</p> Signup and view all the answers

    What are the charges by a healthcare facility or physician compiled in?

    <p>Chargemaster</p> Signup and view all the answers

    What describes a charge-based payment mechanism?

    <p>Fee-for-service</p> Signup and view all the answers

    What does fee-for-service payment provide?

    <p>more units of service in order to receive more payments.</p> Signup and view all the answers

    Why do healthcare facilities set retail prices significantly above rates actually paid?

    <p>Access to contracted payment rates and related factors.</p> Signup and view all the answers

    What is the use of cost-based payments?

    <p>Limited set of small rural healthcare facilities.</p> Signup and view all the answers

    What is the payment mechanism that has been nearly eliminated from the healthcare industry?

    <p>Cost based Payment</p> Signup and view all the answers

    Which healthcare provider benefits the most from a cost-based payment method?

    <p>The healthcare provider</p> Signup and view all the answers

    What payment method is least effective in stabilizing costs per patient?

    <p>Cost-based payment</p> Signup and view all the answers

    What are the five main types of prospective payments used in today's healthcare market?

    <p>DRG healthcare provider, Per Procedure, Case rate, Per diem, Bundled payment</p> Signup and view all the answers

    What payment is based on the patient's diagnosis?

    <p>(DRG) Diagnosis Related Group</p> Signup and view all the answers

    What is the most widely used payment method to healthcare providers?

    <p>(DRG)'s</p> Signup and view all the answers

    What classifies a disease or injury into approximately 750 different categories?

    <p>(DRG)</p> Signup and view all the answers

    What defines the increase or decrease adjustment to payment?

    <p>Relative weight</p> Signup and view all the answers

    What is the average level of severity of conditions of patients in a healthcare provider during a specified period?

    <p>case mix index</p> Signup and view all the answers

    A _________ pays a specified fee for each procedure performed on a patient.

    <p>Health plan</p> Signup and view all the answers

    What are the two payment approaches used in the per-procedure payment plan?

    <p>APC and RBRVS</p> Signup and view all the answers

    What payment approach is similar to the inpatient DRG?

    <p>APC</p> Signup and view all the answers

    What payment approach allows physician payment to vary based on resources needed?

    <p>Resource Based Relative Value Scale (RBRVS)</p> Signup and view all the answers

    __________ at 100% of the per-procedure fee.

    <p>Primary procedure</p> Signup and view all the answers

    _________ at 50% of the normal per-procedure fee.

    <p>Secondary procedure</p> Signup and view all the answers

    _________ 25% of the normal per-procedure fee.

    <p>Third and Subsequent procedure</p> Signup and view all the answers

    What are the common discounting approaches?

    <p>primary, secondary, and third/subsequent procedures</p> Signup and view all the answers

    What must a health plan have in place to control its risk of increased costs?

    <p>A utilization management program</p> Signup and view all the answers

    What is the predetermined amount paid to a healthcare provider for a specified service?

    <p>Case rate</p> Signup and view all the answers

    What is the difference between case rate and DRG?

    <p>Case rates encompass similar procedures while DRG can be specific to a diagnosis.</p> Signup and view all the answers

    Where is a common area where case rates would be used?

    <p>Cardiac surgery</p> Signup and view all the answers

    What payment system is used primarily for long-term care facilities?

    <p>Per diem payment system</p> Signup and view all the answers

    What health plan reimburses a facility a fixed amount per day?

    <p>per diem payment system</p> Signup and view all the answers

    What are the cons of the per diem system?

    <p>The rate may vary for different levels of service.</p> Signup and view all the answers

    What are the benefits of the per diem system?

    <p>It is administratively easy and provides predictable payment rates.</p> Signup and view all the answers

    What involves staff from the facility working with the health plan for patient review?

    <p>Concurrent review</p> Signup and view all the answers

    What is episodic payment in which all services provided are paid as a single rate?

    <p>bundled payment</p> Signup and view all the answers

    What are forms of risk-based contracts?

    <p>bundled payments and other shared savings</p> Signup and view all the answers

    What aligns the incentives of healthcare providers and physicians?

    <p>value-based payment</p> Signup and view all the answers

    What must be in place for acceptable financial results from a per diem payment contract?

    <p>A concurrent review</p> Signup and view all the answers

    What pays a fixed amount Per Member Per Month to a provider?

    <p>Capitation</p> Signup and view all the answers

    What is the most common in relationships between primary care physicians and managed care plans?

    <p>Capitation</p> Signup and view all the answers

    _________ at 50% of the normal per-procedure fee.

    <p>Secondary procedure</p> Signup and view all the answers

    What is the average level of severity of conditions of patients known as?

    <p>case mix index</p> Signup and view all the answers

    What are examples of risk-based contracts?

    <p>MSSP ACOs and the Quality Payment Program</p> Signup and view all the answers

    ______ _________ contracts overlay a conventional payment methodology with a retrospective settlement mechanism.

    <p>risk based</p> Signup and view all the answers

    _________ the payer and the provider share financially in both the risks and rewards of healthcare services.

    <p>risk based contract</p> Signup and view all the answers

    From the perspective of the medical group, what poses the least financial risk?

    <p>charge based payment</p> Signup and view all the answers

    What is the least to greatest risk to healthcare providers?

    <p>least risk - charge based payment; greatest risk - Capitation</p> Signup and view all the answers

    What represents the greatest and least financial risk for hospitals?

    <p>greatest risk - cost based payment; least risk - charge based payment</p> Signup and view all the answers

    What is a payment based on a pre-determined amount for a specified service?

    <p>case rate</p> Signup and view all the answers

    What is payment based on billed charges or a percentage discount of charges?

    <p>charge based</p> Signup and view all the answers

    What is payment based on a patient's diagnosis?

    <p>DRG</p> Signup and view all the answers

    What is payment based on a fixed amount per day?

    <p>per diem</p> Signup and view all the answers

    Ambulatory Payment Classification (APC) and Resource-Based Relative Value Scale (RBRVS) are both approaches to which type of payment?

    <p>per procedure payment</p> Signup and view all the answers

    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.
    • 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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    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.

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