Ch10- A/R and Collection Concepts

Question 1

Which denial is when the patient is covered under another insurance?
a. Coordination of benefits
b. Timely Filing
c. Incorrect Information
d. Non-covered service

Answer 1

a. Coordination of benefits

Question 2

Which is the best way to handle a denial for incorrect information?
a. Do nothing and resubmit the claim
b. Review the information, make sure it’s correct and if it matches, resubmit the claim
c. Contact the insurance company and the patient to figure out where the error is and get it corrected
d. Bill the patient and let them figure out what’s wrong

Answer 2

c. Contact the insurance company and the patient to figure out where the error is and get it corrected

Question 3

Which of the following is a statement sent to the patient from the insurance carrier explaining services paid for on their behalf?
a. Remittance Advice
b. Patient Statement
c. Explanation of Benefits
d. Patient Ledger

Answer 3

c. Explanation of Benefits

Question 4

What is the first step in working a denied claim?
a. Resubmit the claim
b. Contact the carrier
c. Appeal the claim
d. Determine and understand why the claim was denied

Answer 4

d. Determine and understand why the claim was denied

Question 5

What is the lower level of care denial?
a. A service coded at a higher level than the documentation supports
b. Care is provided on an inpatient basis that is typically provided on an outpatient basis
c. An outpatient procedure that could not have been done in the provider’s office
d. An outpatient procedure that is an inpatient only procedure

Answer 5

b. Care is provided on an inpatient basis that is typically provided on an outpatient basis

Question 6

Can a patient be refused treatment due to inability to pay for the services?
a. No, a patient can never be refused treatment
b. Yes, a provider can refuse to see any patient for any reason
c. Yes, a provider can refuse to see a patient when it is not an emergency situation
d. Yes, if a patient owes more than $5,000

Answer 6

c. Yes, a provider can refuse to see a patient when it is not an emergency situation

Question 7

Which of the following is the highest level of the appeals process of Medicare?
a. Reconsideration
b. Judicial Review
c. Appeal Council
d. Administrative Law Judge

Answer 7

b. Judicial Review

Question 8

Which federal act states that third-party collectors are prohibited from employing deceptive or abusive conduct in the collection of the debt?
a. Fair Credit and Charge Disclosure Act
b. Truth in Lending Act
c. Fair Credit Reportingg Act
d. Fair Debt Collection Practices Act

Answer 8

d. Fair Debt Collection Practices Act

Question 9

Which Chapter of the U.S. Bankruptcy Code combines the debt of the debtor and reduces the monthly payments allowing a potential for a provider to receive a portion of what is owed?
a. Chapter 11
b. Chapter 7
c. Chapter 9
d. Chapter 13

Answer 9

d. Chapter 13

Response Feedback:
Rationale: Chapter 13 – Adjustment of Debts of an Individual with Regular Income. The debts owed by the debtor are combined and the monthly payment is potentially reduced for the debtor. Under this filing, a provider or facility has the potential to receive a portion of the debt owed. Instructions for filing a claim against the bankruptcy are found on the back of the bankruptcy notice.

Question 10

What does a high number of days in A/R indicate for a medical practice?
a. The days in A/R do not indicate anything about the practice.
b. The practice is using their A/R for loan purposes.
c. The practice potentially has a problem in the revenue cycle.
d. The practice has good policies in place, which results in good collections of outstanding balances.

Answer 10

c. The practice potentially has a problem in the revenue cycle.

Response Feedback:
Rationale: The days in A/R number should be low, in contrast, a high days in A/R number will most likely indicate there is a problem in the revenue cycle.

Question 11

When a provider wants to give a discount on services to a patient, which option is acceptable?
a. The provider must discount the charge prior to billing the insurance carrier.
b. The provider can waive the co-payment at his discretion.
c. The provider can accept insurance only payments and write-off all patient balances.
d. The provider cannot discount the charge under any circumstance.

Answer 11

a. The provider must discount the charge prior to billing the insurance carrier.

Response Feedback:
Rationale: A provider who practices routine write-offs of co-payments and deductibles is at risk of violating insurance carrier contracts or federal and state laws. When a patient covered by insurance is offered a discount at the time of service, often referred to as a prompt payment discount, the insurance carrier must also be offered the same discount.

Question 12

When a patient files Chapter 7 under the U.S. Bankruptcy Code, which statement is TRUE?
a. The patient’s debt is reorganized and paid at a discounted rate.
b. Most medical debt is discharged, the provider will write-off amounts owed.
c. The provider is required to refund the patient any balances paid.
d. The patient’s debt is adjusted.

Answer 12

b. Most medical debt is discharged, the provider will write-off amounts owed.

Response Feedback:
Rationale: Chapter 7 – Liquidation. The person’s assets are sold and the payment is made to debtors. In the case of Chapter 7 under the U.S. Bankruptcy Code, most medical debt is discharged. In this case, the provider will write-off the amount owed by the patient.

Question 12

What should be included in a financial policy?
I. Explain that patient balances are due at the time services are provided.
II. List insurance carriers the providers are contracted with.
III. List insurance carriers the providers are not contracted with.
IV. List the practice’s policy when seeing patients who are out-of-network.
V. List the patients on the Medicaid roster.
a. I, III, V
b. II, IV, V
c. I, III, IV
d. I, II, IV

Answer 12

d. I, II, IV

Response Feedback:
Rationale: The financial policy should explain that the total cost of the visit, copayments, co-insurance, and/or deductibles are required to be paid at the time of service. The policy should also list the insurance plans that are accepted, and the practice’s policy for patients with out-of-network insurance plans.

Question 13

A biller received a request for medical records for Patient A for DOS 05/15/20XX. Patient A’s entire medical record (multiple dates of service) was copied and sent to the insurance carrier. Which statement below is TRUE?
a. This is a violation of the Affordable Care Act.
b. This is a violation of the Fair Debt Collection Practices Act.
c. This is a violation of HIPAA.
d. This is an acceptable practice to minimize the time to look for the correct date of service.

Answer 13

c. This is a violation of HIPAA.

Response Feedback:
Rationale: HIPAA has a clause called “minimum necessary.” This means only the records requested to support the submitted charges are the ones that should be copied and sent. Additional dates of service not requested should not be sent.

Question 14

When accepting debit cards in a medical practice, which act requires the office to disclose specific information before completing a transaction?
a. Fair Credit Billing Act
b. Health Insurance Portability and Accountability Act (HIPAA)
c. Electronic Funds Transfer Act
d. Equal Credit Opportunity Act

Answer 14

c. Electronic Funds Transfer Act

Response Feedback:
Rationale: When allowing payments via a debit card, the office must also be familiar with the Electronic Funds Transfer Act. This act requires the office or facility to disclose specific information before completing a transaction.

Question 15

Which statement is TRUE regarding the Prompt Payment Act?
a. Federal agencies are required to pay clean claims within 30 days of receipt.
b. Federal agencies are not required to respond to all clean claims within 30 days of receipt.
c. Patients are required to pay patient balances within 30 days.
d. Patient balances are dismissed if a statement is not sent to the patient within 30 days.

Answer 15

a. Federal agencies are required to pay clean claims within 30 days of receipt.

Response Feedback:
Rationale: The Prompt Payment Act is a federal law that ensures that federal agencies pay their bills within 30 days of receipt and acceptance of material and/or services.

Question 16

How often should the patient’s insurance coverage be verified?
a. at the initial visit and when the insurance coverage changes
b. every visit
c. once a year
d. once a month

Answer 16

b. every visit

Response Feedback:
Rationale: The patient’s insurance coverage should be verified every time a patient is seen. The patient may present an insurance card, but that does not mean that they are insured. Changes in coverage are common. A patient may change insurance plans or the copayments and deductibles may change. Prior to treatment, the insurance carrier should be contacted to verify coverage and the amount to be collected from the patient. This can be done through phone calls, the insurance carrier’s website, or through the clearinghouse.

Question 17

Review the following Accounts Receivable Management Policy:
1-Insurance claims will be created daily for manual and electronic filing. This should ensure that all insurance claims are submitted within two days of charge entry.
2-Guarantor statements will be created weekly to ensure timely initial billing of personal balances. Patients will receive one statement per month for personal balances. Each charge on which there is an unpaid personal balance will be billed a minimum of three times.
3-Insurance balances will be referred to internal follow-up staff for follow-up at 45 days post initial claim, and personal balances will be referred at the time the patient becomes responsible for payment. The collection services department becomes responsible for all balances as soon as the charge is entered.
4-Personal balances will be eligible for referral to an outside collection agency after three statements have been sent.

Based on this policy, when does follow-up of insurance balances begin?
a. Within two days of charge entry.
b. 60 days post initial claim.
c. 45 days post initial claim.
d. After three claims have been sent.

Answer 17

c. 45 days post initial claim.

Response Feedback:
Rationale: According to this policy, insurance balances will be referred to internal follow-up staff for follow-up at 45 days post initial claim.

Question 18

Review the following financial policy:
Financial Policy:
You are responsible for paying all co-payments at the time of service. Co-payments, co-insurance, deductibles, and non-covered services cannot be waived by our office, as it is a requirement placed on you by your insurance carrier. Failure to pay your portion of services rendered will be reported to your insurance carrier and could result in termination of your insurance plan.
Non-covered Services: The following services are considered “Non-Covered Services” by most insurance carriers. The fees listed below must be paid at the time of service.
· Forms Completion: Disability Form, Insurance Form, Travel Form, Release from Work Form, Prior Authorization, and other forms are not required by most insurance plans or employers. If you require a physician to complete one of these forms, there will be a $25 charge in addition to your office visit charge.
· Paper Medical Records: We will provide to you, upon written request, a paper copy of your medical record. We charge a base fee of $20.00.
· Late Fees: Invoices not paid within 60 days will result in a $5 per month late fee.
· Co-payment Collection Fee: If we must bill you for your co-payment, you may be required to pay a $20 Co-payment Collection fee.

When must a co-payment be collected by the office for the patient to avoid a penalty?
a. Before the appointment is scheduled.
b. At the time of service.
c. After receiving a statement.
d. After the insurance is billed.

Answer 18

b. At the time of service.

Response Feedback:
Rationale: The policy states “You are responsible for paying all co-payments at the time service.” Co-payments should be collected by the front office staff during patient registration. It is more difficult to collect payment after the patient has received treatment. Many times, patients will leave the office without paying or state they forgot their checkbook or debit card at home. When this happens, the practice has the added cost of sending an invoice to the patient to collect the money that should have been collected up front.

Question 19

What steps should be taken when a medical office receives notice that a patient has filed bankruptcy?
a. Obtain the case number, verify the case filing, verify the provider is listed as a creditor, and stop all collection efforts for balances filed under the bankruptcy.
b. Stop all collection efforts and dismiss the patient from the practice.
c. Dismiss the patient from the practice and send any outstanding balances to a collection agency.
d. Obtain the case number and write-off all patient and insurance balances on the patient’s account.

Answer 19

a. Obtain the case number, verify the case filing, verify the provider is listed as a creditor, and stop all collection efforts for balances filed under the bankruptcy.

Response Feedback:
Rationale: When a medical provider or facility receives notice that a patient has filed for bankruptcy, the following steps should be taken:
· If notice is received from the patient, ask for the case number. If a notice is received from the bankruptcy court, the case number will be on the notice.
· Verify the case filing with the bankruptcy court.
· Verify the medical provider or facility is listed as a creditor.
For providers listed as a creditor, stop all collection efforts on balances incurred prior to the filing of bankruptcy. The provider or facility may continue to collect balances due from the insurance carriers.

Question 20

A claim was resubmitted to AAPC Insurance Company through a clearinghouse 60 days after the date of service and the claim was denied. AAPC Insurance Plan has a 60 day timely filing limit. The biller checked the claim status system and determined AAPC Insurance Plan did not receive the claim. What action should the biller take?
a. Write-off the balance since the claim was not received within Medicare’s timely filing deadline.
b. Check with the provider.
c. Check the clearinghouse’s report and appeal the denial with proof of claims submission.
d. Transfer the balance to patient responsibility.

Answer 20

c. Check the clearinghouse’s report and appeal the denial with proof of claims submission.

Response Feedback:
Rationale: If a claim is submitted after the filing deadline, the claim is denied. This type of denial can be appealed if you have documentation that supports the claim was originally filed within the timely filing deadline. When a claim is denied because it was not filed timely, and there is no documentation for an appeal, the balance must be written off by the participating provider and cannot be billed to the patient.

Question 21

What documents are needed for a successful appeal?
a. The original RA, copy of the medical record, encounter form, and a statement from the patient.
b. Copy of the medical record, a letter detailing why the claim should be paid, and a statement from the patient.
c. Copy of the RA, encounter form, medical record, and a letter detailing why the claim should be paid.
d. Copy of the RA, copy of the medical record, copy of the original claim, and a letter detailing why the claim should be paid.

Answer 21

d. Copy of the RA, copy of the medical record, copy of the original claim, and a letter detailing why the claim should be paid.

Response Feedback:
Rationale: The following documents are needed to successfully appeal a denied claim:
· Copy of the remittance advice for the denied claim
· Copy of the medical record (supporting documentation)
· Copy of the original claim
· Letter (or form specified by the insurance carrier) detailing why the claim should be paid

Question 22

What is a prompt payment discount?
a. A discount given to self-pay patients when they pay at the time of service.
b. A discount on premiums from the insurance carrier when the patient pays their co-payment at the time of service.
c. A discount given to insurance carriers when payment is received in less than 30 days from the date of service.
d. A discount given to patients when payment is received in less than 30 days from the date of service.

Answer 22

a. A discount given to self-pay patients when they pay at the time of service.

Response Feedback:
Rationale: When it comes to patients without insurance, a cash or prompt payment discount may be possible. This policy must be used consistently. A prompt payment discount is typically a percentage of the standard fee schedule and should not be more than any discount given based on insurance contracts.

Question 23

Which Act prohibits third-party debt collectors from calling debtors at odd hours?
a. Truth in Lending Act
b. Equal Credit Opportunity Act
c. Fair Credit Reporting Act
d. Fair Debt Collection Practices Act

Answer 23

d. Fair Debt Collection Practices Act

Response Feedback:
Rationale: The Fair Debt Collection Practices Act (FDCPA) states that third-party debt collectors are prohibited from employing deceptive or abusive conduct in the collection of consumer debts incurred for personal, family, or household purposes.

Question 24

A claim has been denied as not medically necessary by Medicare. The biller has checked the patient’s medical record and the patient’s insurance policy. No ABN was signed. What is the next action the biller should take?
I. Write-off the charge
II. Check with the provider to appeal the claim
III. Transfer the charge to the patient’s account
a. II or III
b. I or II
c. I
d. III

Answer 24

b. I or II

Response Feedback:
Rationale: Medicare has determined, based on information (procedure and diagnosis code(s)) submitted on the claim, that the procedure was not medically necessary. When a claim is denied due to lack of medical necessity, if the information was reported correctly, the provider can either appeal the claim or write off the amount. If the patient has signed an ABN prior to the procedure, the balance may be transferred to patient responsibility.

Question 25

Which act protects information collected by the consumer reporting agencies?
a. Fair Credit Reporting Act
b. Equal Credit Opportunity Act
c. Truth in Lending Act
d. Fair Debt Collection Practices Act

Answer 25

a. Fair Credit Reporting Act

Response Feedback:
Rationale: Fair Credit Reporting Act – protects information collected by the consumer reporting agencies such as the credit bureaus, medical information companies, and tenant screening services. Organizations that provide information to consumer reporting agencies also have specific legal obligations including the duty to investigate disputed information.

Question 26

Review the following Accounts Receivable Management Policy:
1-Insurance claims will be created daily for manual and electronic filing. This should ensure that all insurance claims are submitted within two days of charge entry.
2-Guarantor statements will be created weekly to ensure timely initial billing of personal balances. Patients will receive one statement per month for personal balances. Each charge on which there is an unpaid personal balance will be billed a minimum of three times.
3-Insurance balances will be referred to internal follow-up staff for follow-up at 45 days post initial claim, and personal balances will be referred at the time the patient becomes responsible for payment. The collection services department becomes responsible for all balances as soon as the charge is entered.
4-Personal balances will be eligible for referral to an outside collection agency after three statements have been sent.

Based on this policy, when are patient balances eligible for an outside collection agency?
a. Within two days of a balance becoming patient responsibility.
b. 45 days after the balance becomes patient responsibility.
c. 60 days after the balance becomes patient responsibility.
d. After three statements have been sent.

Answer 26

d. After three statements have been sent.

Response Feedback:
Rationale: According to this policy, personal balances are eligible for referral to an outside collection agency after three statements have been sent.

Question 27

Which statement is TRUE about a patient’s insurance?
a. Verification of coverage should happen at each visit.
b. Verification of coverage should happen once per year.
c. Once you have a patient’s insurance information it is up to the patient to let you know when it changes.
d. Insurance coverage can only change at the beginning of a year and it is good for the remainder of the year.

Answer 27

a. Verification of coverage should happen at each visit.

Response Feedback:
Rationale: The patient’s insurance coverage should be verified each time a patient is seen. The patient may present an insurance card, but that does not mean that they are insured. Changes in coverage are common. A patient may change insurance plans or the copayments and deductibles may change. Prior to treatment, the insurance carrier should be contacted to verify coverage and the amount to be collected from the patient.

Question 28

Review the following financial policy:
Collections Policy:
Invoices not paid within 60 days begin our collection process. Invoices not paid within 120 days are subject to patient dismissal and submission to our Collection Agency and notification to your insurance plan.

According to this policy, at what age is a balance owed by the patient considered a bad debt and sent to their collection agency?
a. 30 days
b. 365 days
c. 120 days
d. 60 days

Answer 28

c. 120 days

Rationale: Invoices not paid within 120 days are subject to patient dismissal and submission to our Collection Agency and notification to your insurance plan.

Question 29

Which option below is the better way to ask the patient about their current demographic information?
a. Are you still at 123 Highway 21?
b. What is your current address?
c. Has your address changed?
d. Is your address 123 Highway 21?

Answer 29

b. What is your current address?

Rationale: It is important to ask the patient for information in the correct way. Do not ask “has your information changed?” Instead, the front office staff should ask the patient “what is your address, telephone number, employment, and insurance information?” Have the patient give answers to open ended questions instead of a yes or no confirmation.

Question 30

Which statement is TRUE regarding patient balances?
a. The financial policy of the practice cannot include information about write-offs for patient balances.
b. Small balances for which processing costs exceed potential collections may be automatically written-off according to the financial policy of the practice.
c. Writing off any patient balance is considered waiving co-payments and puts the practice at risk for violating state and federal regulations.
d. Best practices is to write-off any patient balance under $50.00.

Answer 30

b. Small balances for which processing costs exceed potential collections may be automatically written-off according to the financial policy of the practice.

Rationale: The financial policy should address handling of past due accounts. A practice may automatically write off small patient balances for which processing costs exceed potential collections.