Chapter 10: A/R and collection Concepts

Question 1

What is the first step to a denied claim?

Answer 1

Determine and understand why the claim was denied

Question 2

Which denial is when the patient is covered under another insurance?

Answer 2

Coordination of benefits

Question 3

Which are the two main types of bankruptcy seen by medical practices?

Answer 3

Chapter 7 & 13
Chapter 7 - liquidation
Chapter 13 - adjustment of debts of an individual with regular income

Question 4

What is a statement sent to the patient from the insurance carrier explaining services paid for on their behalf?

Answer 4

EOB - explanation of benefits

Question 5

What is the best way to handle a denial for incorrect information?

Answer 5

Contact the insurance company and the patient to see where the error is and get it corrected

Question 6

Can a patient be refused treatment due to the ability to pay for the service?

Answer 6

Yes, if it is not an emergency situation

Question 7

What is a lower level of care denial?

Answer 7

-Care provided on an inpatient basis is typically provided on an outpatient basis.
-Outpatient procedure could have been done in the providers office.
-Skilled nursing care old have been performed by a HH agency.

• An appeal should be written to insurance explaining why the higher level of care was required.

Question 8

Which federal act states that third party debt collectors are prohibited from employing deceptive or abusive conduct in the collection of the debt?

Answer 8

Fair debt collection practices act (FDCPA)

Question 9

Which is the highest level of appeal process of medicare?

Answer 9

Judicial Review - final level of appeal for medicare

Question 10

What is an ERA (Electronic Remittance Advice)?

Answer 10

An electronic statement sent by an insurance carrier to the medical provider

Question 11

What information does the RA and ERA include?

Answer 11

Identifying information of the patient.
Claim amounts - total billed, adjustment, amount paid, claim total.
Claim status - paid, denied, pending
Explanation of decision

Question 12

What represents money owed to the healthcare practice by patients and/or insurance carriers?

Answer 12

A/R - Account Recceivable

Question 13

What are the functions of accounts receivable management?

Answer 13

Insurance verification
insurance eligibility
prior authorization
billing and claims submission
posting payments
collections

Question 14

Which act prohibits third party debt collectors from calling debtors at odd hours?

Answer 14

Fair Debt Collection Practices Act (FDCPA) - third party collectors are prohibited from employing deceptive or abusive conduct in the collection of consumer debts incurred

Question 15

What is the Prompt Payment Act?

Answer 15

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

Bankruptcy:
Chapter 7 vs. Chapter 13

Answer 16

Chapter 7: liquidation - assets are sold and payment is made to debtors. Most medical debt is discharged. (Written off)
Chapter 13: Adj. of debts of an individual with regular income - debts owed by the debtor are combined and the monthly payment is potentially reduced for the debtor. Provider or facility has the potential to receive a portion of the debt owed. Instructions for filing a claim will be on the back of the notice.

Question 17

What steps must be taken when a provider or facility receives notice a patient has filed for bankruptcy?

Answer 17

• get case number (from patient or notice)
• verify case filing with bankruptcy court
• verify medical provider or facility is listed as a creditor
• stop all collection efforts on balances owed if listed as creditor (for balances inquired prior to filing for bankruptcy.)

Question 18

What should be included in a Financial policy?

Answer 18

• total cost of the visit
• copays, coinsurance, and/or deductible that are required to be paid at time of service
• list insurance plans that are accepted
• practice policy for patients with out of network insurance plans

Question 19

What is the prompt pay discount?

Answer 19

A discount given to self-pay patients when they pay at the time of service. Must be used consistently. Usually a percentage of the standard fee schedule

(Don’t confuse this with the prompt payment act!!!)

Question 20

Prompt Payment Act vs. Prompt Payment Discount

Answer 20

Prompt payment act - federal law that ensures federal agencies pay their bills within 30 days of receipt and acceptance of materials and/or services

Prompt payment discount - a discount given to self pay patients when they pay at the time of service

Question 21

Which act protects information collected by the consumer reporting agencies?

Answer 21

Fair Credit Reporting Act - protects information collected by the consumer reporting agencies such as the credit bureaus, medical information companies, and tenant screening services.

Question 22

What is considered acceptable for when a provider wants to give a discount on services to a patient?

Answer 22

A provider who practices routine write-offs of copays 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, the insurance carrier must also be offered the same discount.

Question 23

When should patient invoices/statements be sent to the patient?

Answer 23

As soon as the RA is posted and a balance is transferred to the patients account (pt responsibility)
*The sooner the invoice is received the sooner it is likely to be paid.

Question 24

What are some potential errors that can occur during patient registration?

Answer 24

• Invalid address
• Invalid insurance information
• Invalid phone number
• Incorrect subscriber and DOB
• Patient Name and DOB doesn’t match insurance

Question 25

How often should the patient’s insurance coverage be verified?

Answer 25

At every visit.

Question 26

A biller received a request for medical records for Patient A for DOS 05/15/20XX. Patient A’s entire medical record was copied and sent to the insurance carrier. What act does this violate?

Answer 26

violation of HIPPA.
“minimum necessary’ = should have only sent medical records for the DOS in question.

Question 27

Once a credit balance for an insurance carrier has been identified, what action should the biller take?

Answer 27

Research to determine if it is a true overpayment, then submit a refund to the insurance carrier for the overpayment.
Failure to refund an overpayment = violates Reverse False Claims Act

Question 28

What does a high number of days in A/R indicate for a medical practice?

Answer 28

The practice potentially has a problem in the revenue cycle. Days in A/R should be low.

Question 29

What are some common claim denial reasons?

Answer 29

• Incorrect information
• COB
• Timely filing
• Missing a referral or PA
• Non-covered services
• Coverage terminated
  -Not medically necessary
• Pre-existing condition

Question 30

What are the 5 levels of appeal for Medicare?

Answer 30

1. Redetermination
2. Reconsideration
3. Administrative Law Judge
4. Appeals Council
5. Judicial Review in Federal Court

Question 31

What should be included in the Patient collection policy?

Answer 31

• details how the practice attempts to collect debts and what actions to take when the patient doesn’t pay
• process for dismissal of a patient for nonpayment
• payment plans
• use of a collection agency

Question 32

What act was developed in 1968 to ensure fair and honest credit practices?

Answer 32

Consumer Credit Protection Act (CCPA)

Question 33

What acts does the Consumer Credit Protection Act (CCPA) include?

Answer 33

• Equal Credit Opportunity Act
• Fair Credit Reporting Act
• Truth in Lending Act
  1. Fair Credit Billing Act
  2. Fair Credit and Charge Card Disclosure Act

Question 34

Which act prohibits the discrimination for providing credit based on person characteristics such as race and religion?

Answer 34

Equal Credit Opportunity Act

Question 35

Which act requires lenders to disclose credit terms and for the creditor to use uniform methods for computing the cost of credit which allows the borrowers to fully understand how much it will cost to borrow money?

Answer 35

Truth in Lending Act contains 2 other acts:
1. Fair Credit Billing Act - Requires creditor to promptly credit your payments and correct mistakes
2. Fair Credit and Charge Card Disclosure Act - Requires a creditor to disclose terms on the credit such as the APR