Training MateriaL RCM(Healthcare)

7/28/2019 Training MateriaL RCM(Healthcare)

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History of the US healthcare

reimbursement system

In the beginning of the 1900s, patients paid

providers directly for services


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reimbursement system

Health insurance was created in the 1930s.


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reimbursement system contd

Today, a large percentage of the US population hashealth insurance through their employer.

Today, many US residents also have health insurancethrough the government instead of a private company.


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What is a provider?

Providers:

Are individuals, corporations, institutions, orfacilities who are licensed by government to provide

medical care, services, goods, and suppliers to

patients.

Examples of providers: physicians, nurses,hospitals, and nursing homes.


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What is a supplier?

Suppliers:

Are organizations that sell healthcare products to

providers to be used in the delivery of healthcare.

Examples of suppliers: Merck, Johnson & Johnson.


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What is a researcher?

Healthcare Researchers:

Are persons or organizations that use scientificmethods to discover new causes of morbidity,

methods of treatment, or ways to avert illness.

This research leads to technological advances in

the healthcare.Examples of healthcare researchers: National

Institute of Health (NIH), The University of

Michigan (U of M), and Pharmacia Corporation.


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What is a health Insurance?

With health insurance.

A person pays periodic payments (i.e. premium)

to an insurance company to cover future

medical expenses. The insurance coverage is

referred to as an insurance plan. These

premium payments allow that person to beenrolled with the company; that person is then

referred to as an enrollee, insured, or

covered.


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How is a provider paid by health

insurance?

Once patient receives

treatment or evaluation,

the provider complies

diagnostic and

insurance information.

Clinical and charge

information is closed

A claim is generated

and submitted to the

insurance carrier

Provider receives payment

as per contractual or

reimbursement arrangement

The insurance carrier

reviews bill/claim and

reimburses provider

according to contract or

reimbursement

agreements


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A Closer look at providers


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A Closer look at providers contd

Providers can be:

- individuals such as doctors, nurses, oremergency room technicians

- Facilities such as hospitals, nursing homes, orambulatory surgery centers

All Providers must be licensed (usually by astate licensing board) to provide medical care,

services, goods, and supplies


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Three types of provider care

All the various providers are arranged to providethree types of care:

- Primary Care: Involves common healthproblems; accounts for 80-90% of all patient

care; usually provided at a physicians privateoffice (e.g. immunizations, sore throat)

- Secondary Care: Involves illnesses/sickness thatrequires somewhat specialized care; usually

provided at a local hospital (e.g. stroke, new borndelivery)

- Tertiary Care: Involves the most complex and/orrare diseases that require the most specialized,

provider expertise; usually provided at auniversity teaching hospital or medical center


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Types of facility providers

Because the CBO primarily is contracted byfacility providers, the training will focus onthese

The following list contains the most commonfacility providers in the US:

- Hospitals

- Ambulatory Surgery Center

- Skilled Nursing Facility- Home Health

- Hospice


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What is a hospital?

A facility that provides the most comprehensiveand intensive medical services available

Two main types of hospitals- Acute: Serves patients on a short term basis

(Example: childrens, adult, and specialtyhospitals)

- Chronic: Serves patients on a long termbasis (Example: Skilled nursing,

rehabilitative hospital)


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What is a hospital contd?

Three types of care are extended athospitals:- Inpatient: a person who is admitted tothe hospital so that he may receive careovernight

- Outpatient: a person who receiveshospital services but does not need toreceive care overnight; because care is notneeded overnight, outpatients are notadmitted

- Emergency: a person who requiresimmediate service because their illness issevere of life-threatening


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What is an Ambulatory Surgery

Center?

A freestanding facility, other than aphysicians office, that operates exclusively

to provide surgical services to patients whodo not require hospitalization. These centersmay either be affiliated with a hospital orhave no affiliation with a hospital.


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What is a Skilled Nursing

Facility (SNF)? A facility that primarily provides inpatient,

skilled nursing care and related services topatients at a lesser intensity than an acutefacility (i.e. hospital).

SNFs are used for patients who needmedical, nursing care, or rehabilitationservices.

Patients are usually treated on a long-termbasis, and care is usually less expensivethan in a hospital.

The most common SNF facility is a nursing

home.


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What is Hospice?

A facility, other than patients home, in whichpalliative and supportive care are provided toterminally ill patients and their families.

Hospices can be hospital-based or free-standing.

Only terminally ill patients are eligible for hospicecare. Hospices emphasize counseling, pain relief, and

symptom management. Treatment of the terminal illness ceases when a

patient chooses hospice care; only symptommanagement remains and treatments for anyother illness besides the one causing death.


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A closer look at payors contd

Payors are third parties who pays for most,if not all, of an enrollees healthcare throughdirect payments to the enrollees provider.

Payors helps individuals reduce personal

financial risk. Payors may be either private companies or

government agencies

Each payor has its own set of coveredbenefits, payment mechanism, andregulations.


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What is Medicare?

Medicare is a US federal governmentprogram which pays for certain healthcareservices for:

- persons 65 years and over,- disabled, or

- diagnosed with permanent kidney failure.

- Persons with AIDS

Because many US employees stop workingbetween age 62-65, Medicare mostly insuresthose no longer eligible for an employershealth coverage.


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Medicare contd

Medicare Managed Care (Medicare Part C)

Insurance plan provided by privateorganizations.

Need to purchase this plan. Covers services that are covered by Part A,

Part B and more (i.e. Prescription drugs, Eyeglasses, Dental care and Hearing aids)


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Medicaid contd

Medicaid does not provide medical assistance forall poor persons

Eligibility depends on a familys income

Family income vs. Federal Poverty Level (FPL),

for 2000 is $17,050 for a family of 4 members Generally state offers coverage to one or more of

the following groups:

- Mandatory

- Categorically Needy- Medically Needy


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Medicaid contd

Categorically needy- Represent same conditions or problemsaddressed on the mandatory eligibles but havehigher income

- States are not required to offer Medicaidcoverage to this group

Medically needy- Persons who have significant healthcareexpenses but have family income in excess of

whats allowed under the mandatory orcategorically needy guidelines

- When the medical expenses are subtrate fromthe family income, the remaining income would

qualify for Medicaid- States are not re uired to offer Medicaid


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Medicaid contd Medicaid Coverage

- Medical coverage has mandatory and optionalservices that may vary from state to state

- State may limit the amount and duration ofservices offered

- Coverage can go back up to the third monthprior to the application

Payment for Medicaid Services- State may pay providers directly or throughpre- payment arrangement (HMO)

- Provider must accept Medicaid payment ratesas payment in full- State can impose nominal deductible, co-insurance and/or co-payments on someMedicaid recipients for certain services


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New Jersey Medicaid Program

Has the three basic categories; Mandatory,Categorically and Medically Needy

1st two are considered regular components

- Pregnant woman with family income below

185% FPL- Aged people (> or = 65 y/o), blind,

permanent or totally disable with familyincome below 100% FPL

Services and coverage depends on Medicaidcategory (regular vs. medically needy)

Fiscal Intermediary process the claim(UNISYS)


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New Jersey Medicaid Program

Billing guidelines may vary from stateto state. In NJ there are some casesthat are required to be billed onhardcopy

Timely filing may also vary from stateto state. The time limit for NJMedicaid is:- 1 year of the date of discharge from an IP

or OP claim

-1 year of the earliest date on OP recurrentaccounts

- 30 days from the date of service forparticipants of Early & Periodic Screening,Diagnosis and Treatment Program

(ESPDT) and Pediatric Health Start


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What is Commercial insurance

contd2. Commercial insurance plan (i.e. indemnity)

- Typically, the insurance co. will pay 80% of a claimwhile the patient pays 20%; another commonarrangement is where company pays 70% of claimwhile the patient pays 30%

-Two types of commercial plans: Group and Individual

Group plans: When the same type of commercial plan iscollectively purchased by a group of people. Groupinsurance is usually purchased by employers for theiremployees

Individual plans: When a commercial insurance is

purchased by only one person


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What is Managed Care? contd

2. Managed Care Plan

- Managed care is different fromCommercial insurance because itattempts to manage a persons care byrestricting the providers an enrollee canvisit. Managed care usually has cheaperpremiums than Commercial Insurance.

- In general, managed care pays a larger

portion of a patients bill thancommercial insurance by limiting apatients choice in providers to thoseproviders who discount services


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Managed Care contd

There are three common types of managed careplans:- Health Maintenance Organization (HMO) plans- Point of Service Organization (POS) plan

-Preferred Provider Organizations (PPO) plans

Other types of plans exist but are beyond thescope of training

Each type of plan has a different balance ofpatients choice in providers versus a patientscost for the plan.

In general, the more choice a patient has inwhich provider he can see, the more expensivethe plan.


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Managed Care: PPO A Preferred Provider Organization (PPO) is

made up of a group of providers who havesimply agreed to discount their services for aspecific insurance plan; this provider group isgenerally much larger than the network in anHMO and POS.

With PPOs, a patients care is not managed bya PCP or even the group of providers; a patientcan see any physician he wants to among theproviders offering discounts.

Out of all managed care plans, PPOs give

patients the most choice in which providersthey can use; for this reason, PPOs are usuallythe most expensive managed care plan.


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Managed Care

PCP Out ofNetwork

HMO x

POS X (if innetwork)

X (at a lesserreimburseme

nt)PPO


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What is Workers Compensation?

Workers Compensation is an insurance system foremployees who have become ill or injured from theirjob.

Employees are eligible to receive a percentage oftheir wages and medical care depending on the timeneeded before they can work again and the extent of

medical treatment needed. Workers Compensation is funded by employer taxes;

employees cannot be charged any premiums Workers Compensation is required by the

government but varies by state; each state has itsown regulations governing the Workers

Compensation system in that state.


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Healthcare Payment Systems:


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Payment Basics

Payors pay providers according to a contractthat they both have signed; in absence of acontract, reimbursement is based on 100%of billed charges

With rising healthcare costs, payors areconstantly seeking payment methods whichencourage providers to reduce healthcareexpenses.

Providers are constantly seek payment

methods which cover their costs of serviceand allow them to treat patients accordingto whats medically necessary (but notnecessarily less expensive)


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P ti t P t


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Patient Payments While payors cover the majority of an enrollees

cost of health care, patients are sometimes

responsible for paying some of the cost.

Common patient responsibilities:

- Premium: the regular payment a person makesto an insurance company to obtain health

coverage

- Deductible: a fixed amount per contractualperiod that a patient pays before healthinsurance will begin to pay; this is only paid if

provider for specific services- Copayment: a small, fixed amount a patient

directly pays a provider for specific services

- Coinsurance: a fixed percentage a patient pays

for services received after a deductible and


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Revenue

The term revenue means amounts earnedby an organization from the provision ofservice or sale of goods.

Because the CBO primarily has hospitalclients, training will focus on hospital

revenue. Thus, hospital revenue includes money the

hospital earns from patient care. To earn revenue, a series of tasks must be

performed; this series of tasks is termed the

revenue generation cycle.


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Admission/Registration

Admission/Registration is the point of entryfor a hospital.

This department

- Admits patients into the hospital and/or

registers them for specific services- Collects patient insurance and other

information, authorizations, and referralsso that hospital services will be covered

- Performs processes before a patient isadmitted or receives services in mostcases

The information collected from patients atthis department are using in billing


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Eligibility Determination

This department verifies the accuracy of thepatients information, particularly regardinginsurance.

The department may contact an insurancecompany or check a companys enrolled fileto verify that a future patient is covered forexpected services.

For patients without insurance, hospitals

will work with patients to find appropriatecoverage.


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Utilization Management &


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Utilization Management &Case Management

Utilization management is responsible for:

-Certification of Admissions

- LOS Monitoring

- Utilization Monitoring

- Discharge Planning

Utilization review may be done while apatient is receiving services (i.e.concurrently) or after a patient hascompleted receiving services (i.e.

retrospectively).

These services are performed to insure

- That a patient can continue recommendedcare (if care has not been completed)

- That a atients insurance will reimburse

Utilization Management & Case


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Utilization Management & Case

Management cont. With the creation of the Managed Care

Programs the Utilization Managementactivities are required to be monitored dailyin coordination with the Payors CaseManager (management of patient care)

At the end of each IP admission the CaseManagement Department will know the LOSapproved and the level of accommodationapproved per case. This information must be

provided to the Patient AccountsDepartment in order to validate theappropriateness of the payment


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Medical Records

Medical Records is the point where codesare assigned to all hospital servicesprovided (ICD-9-CM and HCPCS)

These codes are used by payors to

determine the cause of illness, the necessityof care, and how much a provider should bepaid.

Assigning the appropriate codes isextremely important as it has a direct effect

on how much a hospital will be paid.


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Billing

After a patient has completed care andcodes have been assigned to a patientsaccount, the billing department assignscharges, (according to specific contractualagreements) sends out the bill, and followsthe bill until payment is received or otherfinal action is taken.

The billing department insures that bills (i.e.claims) are sent out correctly and that

payors appropriately process claims.This thepart of the revenue cycle that the CBOperforms!


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Collections

If a bill has been sent but payment has notbeen received for an extended period oftime, Collections attempts to find thisrevenue.

Collection processes may be performed bythe hospital or an outside entity with whichthe hospital contracted.

Collections enter into the revenue cycle forclaims that have not been paid after an

extended period; most hospital claims arepaid before Collection processes are needed.


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Collections cont.

Tools and CBO relation- A/R work station

- EOBs

-Rejection reportsFailed bill report

Scrubbing systems

Clearing House

Payors

- Correspondence

Documents

Training MateriaL RCM(Healthcare)