248 Columbia Turnpike Florham Park, NJ 07932 Office: 973.845.6444 / Cell : 917.538.3905

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248 Columbia TurnpikeFlorham Park, NJ 07932

Office: 973.845.6444 / Cell: 917.538.3905Fax: [email protected]

mailto:[email protected]

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Understanding Your PlanTypes of Insurance

EPO (Exclusive Provider Organization)• Function much like a PPO with a much lower cost.• Lower cost is possible because EPO's limit coverage to in-network providers or

facilities.

HMO (Health Maintenance Organization)• HMO models are in-network-only designs that utilize significant managed care

policies that oversee and control access to care and services.• They don't carry nearly as many freedoms as a PPO model does, but will be

available at a much lower monthly cost.• Require the selection of a Primary Care Physician (PCP) who is responsible for

managing your healthcare needs –both for you and the insurance carrier.• Access to specialists, testing, out-patient hospital procedures and more is all

provided through referrals from your PCP.• All care must be accessed within the network for plan benefits to apply.

248 Columbia Turnpike - Florham Park, NJ 07932 - Office: 973.845.6444 / Cell: 917.538.3905 - Fax: 973.845.6466www.sjpha.com / [email protected]

http://www.sjpha.com/




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Understanding Your PlanTypes of Insurance

PPO (Preferred Provider Organization)• Allows free movement both within and outside of the plan's participating provider

network.• In a referral-free PPO model some hospital admissions, diagnostic testing, out-patient

surgery and more will require pre-certification.• Cover a percentage or portion of your out-of-network care according to their allowable

charges schedule (note that "100% coverage" means 100% of the plan's allowable charges; not 100% of the total bill).

• Have out-of-network care deductibles and coinsurance amounts (portions of the expenses that are shared by subscribers) that must be met before or in conjunction with applicable plan benefits.

POS (Point of Service)• Hybrid of the PPO and HMO models• Require the selection of a Primary Care Physician (PCP)• The PCP can refer patients to both and in and out-of-network providers but referrals are

required as part of the managed care aspect of the POS model.






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Is the plan fully-funded or self-funded?Fully Funded or Fully Insured Plan

• Employer and Employee or stand-alone Individual pay monthly premiums to the insurer.

• The insurer then pays for any medical treatment covered under the policy.

• Regulated by state in which the plan is written. In NJ the governing agency is the Department of Banking and Insurance (DOBI) and in NY the governing agency is the Department of Financial Services (DFS).

• Less flexibility to change or update what is and is not a covered benefit.

• Plans tend to be for small employers and individuals.






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Is the plan fully-funded or self-funded?Self Funded or Self Insured Plan

• Employer and Employee pay monthly premiums to insurer.• Employer covers the cost of any claims for medical treatment.• Most self-funded plans are administered by a third-party administrator

or insurance company that administers and processes claims for a fee.• Most self-funded plans buy protection called stop-loss and pay a

premium so that if a predetermined threshold is crossed the insurer rather than employer assumes the risk.

• Regulated by the Federal Employee Retirement Income Security Act (ERISA).

• More flexibility to change or update what is and is not a covered benefit.

• Plans tend to be for large corporations.






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What are the plan exclusions and limitations?Within your Insurance Summary Plan Description there will be a section

entitled “Medical Plan Exclusions”

• Within this section will be a detailed list of services not covered. Please note that this list is not comprehensive but just a high level summary. If you do not see a needed service as a covered benefit nor on the plan exclusion list, then you should call in to question.

• Language for this section will look like the following:• “Not every medical service or supply is covered by the plan, even if

prescribed, recommended, or approved by your physician or dentist. The plan covers only those services and supplies that are medically necessary and included in the What the Plan Covers section. Charges made for the following are not covered except to the extent listed under the What The Plan Covers section or by amendment attached to this Booklet.”






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Within your Insurance Summary Plan Description there will be a section entitled “Medical Plan Exclusions”

• Language for this section will look like the following:• “Therapies for the treatment of delays in development, unless

resulting from acute illness or injury, or congenital defects amenable to surgical repair (such as cleft lip/palate), are not covered. Examples of non-covered diagnoses include Pervasive Developmental Disorders (including Autism), Down Syndrome, and Cerebral Palsy, as they are considered both developmental and/or chronic in nature.

• Exclusions for developmental disabilities are common in self-funded plans. Sometimes the word “habilitative” is used to describe such therapies as PT, OT and SLP for those with developmental disabilities.

What are the plan exclusions and limitations?






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Within your Insurance Summary Plan Description there will be a section entitled “Medical Plan Limitations”

• While services may be covered, it is also important to note the limitations on coverage. Most if not all plans no longer have a dollar cap per lifetime limitation but they may have limits such as the following:30 visits of PT, OT and SLP combined per annum

30 visits of PT, OT and SLP combined per annumOR60 visits per condition per lifetime

What are the plan exclusions and limitations?






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What are the deductibles & coinsurance amounts?

DeductibleA fixed dollar amount during the benefit period - usually a year that an insured person pays before the insurer starts to make payments for covered medical services.

• Plans may have both per individual and family deductibles. • Some plans may have separate deductibles for specific services. For

example, a plan may have a hospitalization deductible per admission.• Deductibles may differ if services are received from an approved

provider or if received from providers not on the approved list.






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CoinsuranceA form of medical cost sharing in a health insurance plan that requires an insured person to pay a stated percentage of medical expenses after the deductible amount, if any, was paid.

• Once any deductible amount and coinsurance are paid, the insurer is responsible for the rest of the reimbursement for covered benefits up to allowed charges: the individual could also be responsible for any charges in excess of what the insurer determines to be “usual, customary and reasonable”.

• Coinsurance rates may differ if services are received from an approved provider (i.e., a provider with whom the insurer has a contract or an agreement specifying payment levels and other contract requirements) or if received by providers not on the approved list.

• In addition to overall coinsurance rates, rates may also differ for different types of services.

What are the deductibles & coinsurance amounts?






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How does the plan reimburse?

In-NetworkContract Rates. Member is only responsible for Co-Pay.

Out of NetworkPercentage of Medicare or Usual, Customary and Reasonable (UCR) charges?

• Some plans base reimbursement on a percentage of what Medicare would pay for the procedure regardless of whether or not an individual is on Medicare. The percentage ranges anywhere from 140% - 250%.

• Other plans reimburse based on Usual, Customary, and Reasonable (UCR) charges. UCR charges mean that the charge is the provider’s usual fee for a service that does not exceed the customary fee in that geographic area (zip code) and is reasonable based on the circumstances.

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What does a proper invoice look like for out of network providers & how does this affect reimbursement?

Refer to the HICF 1500 FORM

Does this invoice have the correct patient information?

• Member name, Address, ID #

Does the invoice have the correct provider information?

• Provider Name, Address, Tax ID #, License #

Does the invoice have the correct diagnosis code (DX) and procedure code (CPT)

• Confirm with medical doctor & provider. Make sure decimal points are in the correct spot.

Does the procedure code need to be state in time such as one hour or in units?

• Physical Therapy and Occupational Therapy should be submitted based on units whereby 1 unit is 15 minutes

• Speech Therapy is reimbursed by date of service

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Example






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How are claims processed?

How are claims processed?

• Each invoice needs to be submitted with a claim form that can be obtained from your insurance provider or through their website. Refer to the Claim Form.

• The invoice needs to be paper clipped (not stapled) to your claim form for it to be processed.

Review of explanation of benefits (EOBs). Refer to the EOB.

• Was the correct rate paid to client and/or provider?• Was the deductible and co-insurance properly accounted for?• How best to track EOBs to ensure proper accounting of claims on an annual basis?






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How to file an appeal if specific services/treatments/procedures are denied?

Review of Level 1, Level 2 and External Appeal.

• As a Member you have three levels of appeal; Level 1 (internal), Level 2 (internal with a different team than the one that rendered the Level 1 denial) and External Appeal. The External Appeal will either be submitted to the State in which your Plan was written out of or, if a self-funded plan, your External Appeal will go to your insurance provider and they will in turn.

• These third party review organizations are referred to as Independent Review Organization (IURO). The IURO’s decision is binding on the insurance carrier but the Member can seek legal action thereafter.






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Proper review of denial letter to ensure client is meeting stated deadlines for the three levels of appeal as well as understanding of the reason for denial.

• The initial processing or denial of a claim will come in the form of your Explanation of Benefits. If you are denied coverage for your claim, you will be notified that you can start the Appeals Process within a certain amount of time (i.e. 180 days) from receipt of the EOB. There will also be an address on where to send the Appeal to.

• If you are not successful with the Level 1 Appeal, you will be given the option to proceed with a Level 2 Appeal. • The time frame for a Member to submit the Level 2 Appeal typically differs than the

time frame for the Level 1 Appeal. As such, it is very important to keep track of these dates.






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Proper review of denial letter to ensure client is meeting stated deadlines for the three levels of appeal as well as understanding of the reason for denial. • You are also allowed to request the policy guidelines and any additional

information your Insurance Provider used in making their denial. This must be done in writing.

• Additionally, most plans start the time frame for the External Appeal on the same date that you can initiate the Level 2 Appeal. For example, you may be given 90 days from the Level 1 Denial to initiate the Level 2 Appeal while at the same time be given 4 months from the Level 1 Denial to submit the External Appeal. There is not much difference in time so it’s imperative to get the Level 2 Appeal in as quickly as possible.

• At any time that the Appeal is ruled in Member’s favor, you are then done with the Appeals process.






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Who is the client appealing to?

• As noted previously, the External Appeal route will depend on whether or not your Plan is fully-funded or self-funded. • Fully-Funded will be sent to the State in which your Plan was written (i.e. Dept of

Banking and Insurance in NJ or Department of Financial Services in NY).• Self-Funded will be sent to your Insurance Provider requesting an External Review.






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What is a letter of medical necessity? How do you write one to ensure a successful appeal?

• Insurance Plans deny for two main reasons: medical necessity or plan exclusion.• The latter, plan exclusion, cannot successfully be appealed unless the Insurance

Provider is not reading your Plan accurately in denying your claim. If however, your Plan is self-funded, you may approach your Human Resource Dept to write in the benefit. This can be done very quickly if your company chooses to do so.

• If you are being denied for medical necessity, then the Appeals Process detailed earlier is the route to go. • Critical to a successful appeal is the following:

• Clear and detailed notes, progress reports etc from the treating physician/therapist.

• Understanding of your Plan’s Clinical Policy Bulletin. Refer to CPB• Letters of Medical Necessity (LMNs) from your physician/therapist.






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NJ Autism MandateThe law requires that carriers provide:• Coverage for expenses incurred in screening and diagnosing autism or another

developmental disability.• Coverage for expenses incurred for medically necessary physical therapy, occupational

therapy and speech therapy services for the treatment of autism or another developmental disability.

• Coverage for expenses incurred for medically necessary behavioral interventions based on the principles of applied behavior analysis (ABA) and related structured behavioral programs for treatment of autism in individuals under 21 years old with a cap of $36,000; and

• A benefit for the coverage of the “Family Cost Share” expense incurred for certain health care services obtained through the New Jersey Early Intervention System (NJEIS).• Carriers must provide the required coverage without consideration of whether the

services are restorative or have a restorative effect.• *The Federal Mental Health Parity and Addiction Equity Act of 2008 generally prohibits

group health plans, other than small employer group health plans, from having more restrictive benefits or services for treatment of mental illness than are applicable to treatment of physical conditions. As such, the $36,000 may not be enforced depending on plan.






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248 Columbia TurnpikeFlorham Park, NJ 07932

Office: 973.845.6444 / Cell: 917.538.3905Fax: [email protected]


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248 Columbia Turnpike Florham Park, NJ 07932 Office: 973.845.6444 / Cell : 917.538.3905