Billing Manual Final Version

MEDICAL BILLING & CODING
PROCESS MANUAL
5/4/2010 Page 1 of 310 Healthcare Division

Table of Contents

Understanding Healthcare in US

Health Care in U.S.
Medical care in the United States is generally very high quality. The government
closely monitors medically oriented businesses and institutions. Hospitals, clinics,
medical schools, and pharmaceutical companies must comply with government
standards. Doctors, nurses and other medical
personnel must be licensed, and becoming a
medical specialist frequently entails fifteen years
or more of rigorous schooling and training. The
high level of technology available in the U.S. contributes to quality care, and the
average hospital contains millions of dollars worth of state-of-the-art equipment.
Medical and health care is big business. Hospitals and medical schools also spend
substantial amounts on research, knowing that new techniques and discoveries
will bring them prestige, patients, and money, while benefiting many people. The
result for consumers is ever improving quality and effectiveness of medical care,
but at the same time expensive care.
When seeking any kind of medical assistance in the United States, there are few
free services, and most care is expensive. Unlike other countries, there is little
government sponsored health care here, except for those over 65 years of age
(Medicare), or for the poor (Medicaid). The insurance industry is a major influence
in the business of staying well or regaining one's good health. Obtaining some
type of health insurance coverage to protect one self and their family is very
smart, but expect it to be a significant monthly expense.

Medical Emergency
In an emergency, the first thing to remember is "911". This is the telephone
number to call from anywhere in the United States for
immediate, skilled medical attention. While it is wise
to have other important numbers regarding medical
assistance (individual’s personal doctor, poison control
center, etc.) near telephone, in a genuine emergency it is imperative to dial
911 first. In such situations, time is the most important factor in preventing
damage or even loss of life. The operator handling your "911" call will immediately
dispense the necessary help, both in terms of sending an ambulance and in
routing individual’s call to a counselor who will guide through the situation until
the ambulance arrives.
Emergency medicine in the U.S. is very high quality. Ambulance attendants, or
paramedics, are highly trained in dealing with trauma and making split-second
decisions that save lives. And many hospitals are
equipped with trauma centers whose single purpose is
handling emergency situations, including emergency surgery. In an emergency,
individual will begin to receive treatment immediately and will be taken to the
facility that can best handle the situation, whether it is a trauma center, a burn
treatment center, a cardiac treatment center (heart attacks), a children's hospital
or a general hospital. If an individual is conscious, or if there is a family member
or a friend with the individual, they will be asked for the name of patient’s doctor,
who will be summoned to the hospital to which patient is taken.

It is important to keep in mind that while emergency care in the U.S. is excellent,
it is also expensive. There will be a fee for the ambulance, the emergency room,
any medications administered, the services of doctors involved and any tests or
special procedures involved. It is important never to hesitate when there is a
genuine emergency but these services are not intended for situations where a call
to your doctor or a visit to a walk-in clinic would be sufficient.
An additional note about "911" This number is also used in police emergencies,
and therefore is not limited to medical situations. Any time an individual is in
serious danger, witness an accident or a crime in progress, this number is called.
Why Health Insurance is needed?

The United States does not have socialized medical care. If a person does not
have health insurance coverage, he / she have to pay for health care out of their
own finances at the time of service. This can run into many thousands of dollars
for serious illnesses
One buy’s health insurance for the same reason one
buy’s other kinds of insurance, to protect one self
financially. With health insurance, an individual and
their family are protected in case of any medical care that could be very
expensive.
One cannot predict what his medical bills would be. In a good year, costs may be
low but if he becomes ill, medical bills could be very high. If he has insurance,
many of medical costs are covered by a third-party payer, not by the individual. A

third-party payer can be an insurance company or, in some cases, it can be the
employer.
Many people in the United States are enrolled in some sort of managed care plan.
This is an organized way of both providing services and paying for them. Different
types of managed care plans work differently and include preferred provider
organizations (PPOs), health maintenance organizations (HMOs), point-of-service
(POS) plans and fee-for-service plans.
Individuals enrolled in health care plans pay a monthly or quarterly fee as
insurance for the time when they will need medical attention. At the time when a
service is provided, the health insurance organization pays part or the entire fee,
minimizing the amount an individual have to pay at the time of service.
Choosing the right insurance plan that best meets financial circumstances will
depend on information like, whether an individual is married or single, have
children or no children. Definitions of the health insurance terms used are included
in the section called Understanding Health Insurance Terms.

What are the various types of Health Insurance Coverage?
The two main ways that people obtain health coverage are by paying into a group
or buying individual insurance.
 Group Health Plans

 Individual Insurance Plans
Group Insurance Plans
Most Americans get health insurance through their jobs or are covered because a
family member has insurance at work. This is called group insurance. Group
insurance is generally the least expensive kind. In many cases, the employer pays
part or all of the cost.
Some employers offer only one health insurance plan. Some offer a choice of plans
a fee-for-service plan, a Health Maintenance Organization (HMO), or a Preferred
Provider Organization (PPO), for example. Employers with 25 or more workers are
required by Federal law to offer employees the chance to enroll in an HMO.
What happens if an individual or his family
member leaves the job? He will lose employer-
supported group coverage. It may be possible to
keep the same policy, but he will have to pay for it himself. This will certainly cost
him more than group coverage for the same, or less, protection. A Federal law
makes it possible for most people to continue their group health coverage for a
period of time called COBRA (for the Consolidated Omnibus Budget Reconciliation
Act of 1985), the law requires that if an individual work’s for a business of 20 or
more employees and leave the job or are laid off, he can continue to get health

coverage for at least 18 months. He will be charged a higher premium than when
he was working.
He / she also will be eligible to get insurance under COBRA if their spouse was
covered but now he /she is widowed or divorced. If an individual was covered
under his parents group plan while he was in school, he can also continue in the
plan for up to 18 months under COBRA until the individual find a job that offers
individual health insurance.
Not all employers offer health insurance. Individual might find this to be the case
with his job, especially if he work’s for a small business or work part-time. If the
employer does not offer health insurance, he might be able to get group insurance
through membership in a labor union, professional association, club, or other
organization.
Individual Insurance Plans
If the employer does not offer group insurance, or
if the insurance offered is very limited, one can
buy an individual policy. One can get fee-for-service, HMO, or PPO protection. But
an individual should compare the options and shop carefully because coverage and
costs vary from company to company. Individual plans may not offer benefits as
broad as those in group plans
What Types of Insurance Plans Are There?

Managed Care: An Explanation
You will hear the term "managed care" quite a lot in the
United States. It is a way for insurers to help control
costs. Managed care influences how much health care an individual use. Almost all
plans have some sort of managed care program to help control costs. For
example, if an individual need to go to the hospital, one form of managed care
requires that he receive approval from his insurance company before he is
admitted to make sure that the hospitalization is needed. If he goes to the hospital
without this approval, he may not be covered for the hospital bill.
Fee-for-Service Plans
This is the traditional kind of health care policy. Insurance companies pay fees for
the services provided to the insured people covered by the policy. This type of
health insurance offers the most choices of doctors and hospitals. An individual
can choose any doctor he wishes and change doctors any time. He can go to any
hospital in any part of the country.
With fee-for-service, the insurer only pays for part of doctor and hospital bills.
Individual’s pay a monthly fee, called a premium.
A certain amount of money each year, known as the deductible, is paid for by the
individual before the insurance payments begin. In a typical plan, the deductible
might be $250 for each person in a family, with a family deductible of $500 when
at least two people in the family have reached the individual deductible. The
deductible requirement applies each year of the policy. Also, not all health

expenses have count toward the deductible. Only those covered by the policy do.
Individuals need to check the insurance policy to find out which ones are covered.
After individual has paid deductible amount for the year, he would share the bill
with the insurance company. For example, individual might pay 20 percent while
the insurer pays 80 percent. Individual’s portion is called "coinsurance".
To receive payment for fee-for-service claims, individual may have to fill out forms
and send them to insurer. Sometimes doctor's office will do this for Insured.
Individual also need to keep receipts for drugs and other medical costs and is
responsible for keeping track of his own medical expenses.
There are limits as to how much an insurance company will pay for a claim if both
individual and his spouse file for it under two different group insurance plans. A
coordination of benefit clause usually limits benefits under two plans to no more
than 100 percent of the claim.
Most fee-for-service plans have a "cap," the most individual will have to pay for
medical bills in any one year. He reaches the cap when out-of-pocket expenses
(for deductible and coinsurance) total a certain amount. It may be as low as
$1,000 or as high as $5,000. The insurance company then pays the full amount in
excess of the cap for the items listed in policy. The cap does not include what
individual pay for monthly premium.
Some services are limited or not covered at all. Insured need to check on
preventive health care coverage such as immunizations and well-child care.

There are two kinds of fee-for-service coverage basic and major medical. Basic
protection pays toward the costs of a hospital room and care while patient is in the
hospital. It covers some hospital services and supplies, such as x-rays and
prescribed medicine. Basic coverage also pays toward the cost of surgery, whether
it is performed in or out of the hospital, and for some doctor visits. Major medical
insurance takes over where insured basic coverage leaves off. It covers the cost of
long, high-cost illnesses or injuries.
Some policies combine basic and major medical coverage into one plan. This is
sometimes called a "Comprehensive Plan." Insured need to check whether his
policy covers both kinds of protection.
Health Maintenance Organizations (HMOs)
Health maintenance organizations are prepaid
health plans. As an HMO member, insured pay a
monthly premium. In exchange, the HMO
provides comprehensive care for the insured &
his family, including doctors' visits, hospital
stays, emergency care, surgery, laboratory
(lab) tests, x-rays, and therapy.
The HMO arranges for this care either directly in its own group practice and/or
through doctors and other health care professionals under contract. Usually,
patient choices of doctors and hospitals are limited to those that have agreements
with the HMO to provide care. However, exceptions are made in emergencies or
when medically necessary.

There may be a small co-payment for each office visit, such as $5 for a doctor's
visit or $25 for hospital emergency room treatment. Individual total medical costs
will likely be lower and more predictable in an HMO than with fee-for-service
insurance.
Because HMOs receive a fixed fee for your covered medical care, it is in their
interest to make sure patient get basic health care for problems before they
become serious. HMOs typically provide preventive care, such as office visits,
immunizations, well-baby checkups, mammograms, and physicals. The range of
services covered varies in HMOs, so it is important to compare available plans.
Some services, such as outpatient mental health care, often are provided only on
a limited basis.
Many people like HMOs because they do not require claim forms for office visits or
hospital stays. Instead, members present a card, like a credit card, at the doctor's
office or hospital. However, in an HMO individual may have to wait longer for an
appointment than he would with a fee-for-service plan.
In some HMOs, doctors are salaried and they all have offices in an HMO building at
one or more locations in individual’s community as part of a prepaid group
practice. In others, independent groups of doctors contract with the HMO to take
care of patients. These are called individual practice associations (IPAs) and they
are made up of private physicians in private offices who agree to care for HMO
members. Individual select a doctor from a list of participating physicians that
make up the IPA network. If an individual is thinking of switching into an IPA-type
of HMO, he needs to check whether doctor participates in the plan.

In almost all HMOs, individuals are either assigned or choose one doctor to serve
as patient’s primary care doctor. This doctor monitors health and provides most of
patient’s medical care, referring to specialists and other health care professionals
as needed. Patient usually cannot see a specialist without a referral from primary
care doctor who is expected to manage the care received by the patient. This is
one way that HMOs can limit patient’s choice.
In HMO’s there is another part called capitation which is like an agreement
between the insurance and the provider. In brief let us see what it is.
Capitation
Many HMO plans and some PPO plans are considering capitated. When a plan is
capitated the doctor and treatment center receives a monthly payment from
insurance company based on the number of enrollees. The monthly payment may
be varying due to increase or decrease and the treatment centers are paid more
than the individual doctors.
When a doctor or treatment center treats a capitated patient, we go through the
charge entry process, but none of the claims are mailed. This is because under a
capitated plan, since the doctors and treatment centers are paid monthly
regardless if they treat a patient. When they do treat a patient. They can not bill
the insurance company for the services rendered. If a claim is accidentally issued
to the insurance company, they automatically deny the claim as a provider with a
capitated plan, and you hope that none of the enrollees ever became patients

Point-of-Service Plans (POS)
Many HMOs offer an indemnity-type option known as a POS plan. The primary
care doctors in a POS plan usually make referrals to other providers in the plan.
But in a POS plan, members can refer themselves outside the plan and still get
some coverage.
If the doctor makes a referral out of the network, the plan pays all or most of the
bill. If patient refer themselves to a provider outside the network and the service
is covered by the plan then patient will have to pay coinsurance.
Preferred Provider Organizations (PPOs)
The preferred provider organization is a combination of traditional fee-for-service
and an HMO. Like an HMO, there are a limited number of doctors and hospitals to
choose from. When patient use those providers (sometimes called "preferred"
providers, other times called "network" providers), most
of his medical bills are covered.
When patient goes to doctors in the PPO, he presents a
card and do not have to fill out forms. Usually there is a
small co-payment for each visit. For some services, patient may have to pay a
deductible and coinsurance.
As with an HMO, a PPO requires that patient choose a primary care doctor to
monitor his health care. Most PPOs cover preventive care. This usually includes
visits to the doctor, well-baby care, immunizations, and mammograms.

In a PPO, patient can use doctors who are not part of the plan and still receive
some coverage. At these times, patient will pay a larger portion of the bill himself
(and also fill out the claims forms). Some people like this option because even if
their doctor is not a part of the network, it means they do not have to change
doctors to join a PPO.
Features of different Insurance Plans
Whether insured is opting for traditional indemnity fee-for-service plans (FFS),
health maintenance organizations (HMOs), point of service plans (POS), and
preferred provider organizations (PPO). Each plan has its own features to consider
before making a choice.
FFS, Also Called Traditional Indemnity
FFS coverage offers flexibility in exchange for higher out-of-pocket expenses,
more paperwork, and higher premiums.
FFS advantages:
• Individual may choose your own doctors and hospitals.
• Individual may visit any specialist without getting permission from a
primary care physician.
FFS disadvantages:
• There's typically a deductible (anywhere from $500 to $1,500) before the
insurance company starts paying claims, and then doctors are reimbursed
about 80 percent of the bill while patient pick up the remaining 20 percent.

• FFS plans pay only for "reasonable and customary" medical expenses. If
patient’s doctor charges more than the average for the area, patient will
have to pay the difference.
HMO
HMOs are the least expensive, but also the least flexible of all the health insurance
plans. They are geared more toward members of a group seeking health
insurance.
HMO advantages:
• They offer their customers low co-payments, minimal paperwork, and
coverage for many preventive-care and health-improvement programs.
HMO disadvantages:
• Individual must choose a primary care physician, also known as a PCP.
• HMOs require that individual see only network doctors or they won't pay.
• Individual must get a referral from your PCP to see a specialist.
POS
POS plans are more flexible than HMOs, but they also require patient to select a
PCP.

POS advantages:
• Depending on patient insurance company's rules, he may choose to visit a
doctor outside the network and still receive coverage — but the amount
covered will be substantially less than if patient went to a physician within
the network.
• These plans tend to offer more preventive care and well-being services,
such as workshops on smoking cessation and discounts to health clubs.
POS disadvantages:
• Individual must choose a PCP.
• While individual may choose to see a physician outside the network, if he
did not receive permission from PCP, individual is likely to wind up
submitting the bills himself and receiving only a nominal reimbursement —
if any.
PPO
PPOs give policyholders a financial incentive — reasonable co-payments (also
called co-pays) — to stay within the group's network of practitioners.
PPO advantages:
• The standard co-payment is $10 for a routine office visit during regular
hours.
• Individual may go to any specialist without permission, as long as the
doctor participates in the network.

PPO disadvantages:
• If individual see an out-of-network doctor, he may have to pay the entire
bill himself, and then submit it for reimbursement.
• Individual may have to pay a deductible if he chooses to go outside the
network, or pay the difference between what network doctors vs. out-of-
network doctor’s charge.
Types of Insurance
MEDICARE
Medicare is the federal (national) health insurance program for Americans age 65
and older and for certain disabled Americans. If
individual is eligible for Social Security or Railroad
Retirement benefits and are age 65, he and his spouse
automatically qualify for Medicare.
Medicare has two parts hospital insurance, known as Part A, and supplementary
medical insurance, known as Part B, which provides payments for doctors and
related services and supplies ordered by the doctor. If individual is eligible for
Medicare, Part A is free, but insured must pay a premium for Part B.
Medicare will pay for many of insured health care expenses, but not all of them. In
particular, Medicare does not cover most nursing home care, long-term care
services in the home, or prescription drugs. There are also special rules on when
Medicare pays patient’s bills that apply if patient have employer group health

insurance coverage through his own job or the employment of a spouse. Medicare
usually operates on a fee-for-service basis.
Some people who are covered by Medicare buy private insurance, called
"Medigap" policies, to pay the medical bills that Medicare doesn't cover. Some
Medigap policies cover Medicare's deductibles; most pay the coinsurance amount.
Some also pay for health services not covered by Medicare. There are 10 standard
plans from which individual can choose (some States may have fewer than 10.) If
an individual buy a Medigap policy, he should make sure that he does not
purchase more than one.
MEDICARE PART A
Medicare Part A is also known as Hospital Insurance (HI). The intermediary
determines payment to Part A facilities for covered items and services provided by
the facility. The following services are covered in Part A,
• Inpatient Hospital Care.
• Inpatient Care in a Skilled Nursing Facility (SNF).
• Home Health Care.
• Hospice Care.
The services and coverage limitations for each of Medicare Part A Care:
Part A services and coverage for Inpatient Hospital Care:
Covered Services for Inpatient Hospital Care:

• Semi private room
• All meals, including special diets
• Regular Nursing services
• Costs of special care units
• Blood transfusions
• Lab tests
• Medical supplies such as splints and casts
• Use of appliances such as wheelchairs
• X-rays and other radiology services, including radiation therapy, billed by
the Hospital.
• Operating and recovery room costs
• Rehabilitation services, such as physical therapy, occupational therapy and
speech pathology therapy.
Non-covered Services for Inpatient Hospital Care:
• Private duty Nurses
• Personal convenience items
• Any extra charges for a private room unless medically necessary.

Benefit Period for Inpatient Hospital Care:
Benefit period begins when the first day (not on the previous benefit period) on
which an eligible patient is furnished inpatient hospital or extended care services
by a qualified provider. The benefit period with the close of a period of 60
consecutive days (after the date of discharge from the facility) during which the
patient was neither an inpatient hospital nor a Skilled Nursing Facility (SNF).
Eligible Benefits for Inpatient Hospital Care:
A patient is eligible for 90 days of hospital care in a benefit period, as long as
medical necessity for the admission and the number of days has been proven. The
patient also has a lifetime reserve of 60 days, which could be used once the 90
days have been exhausted. Once the reserve days have been used, they are not
replenished.
Part A services and coverage for Inpatient Care in a Skilled Nursing Facility (SNF):
Covered Medicare Part A SNF services include the following:
• Semi-private room
• All meals, including special diets
• Regular Nursing services
• Physical/occupational therapy and speech-language pathology services
• Drugs furnished during stay

• Blood transfusions
• Medical supplies such as splints and casts
• Use of appliances such as wheelchairs
Non-Covered Medicare Part A SNF services include the following:
• Private duty Nurses
• Any extra charges for a private room unless medically necessary
• Any services not provided by the facility and included in its bill.
Duration of Care:
Benefit period – A benefit period begins with the first day (not in a previous
benefit period) on which an eligible patient is furnished inpatient hospital or
extended care services by a qualified provider. The benefit period ends with the
close of a period of 60 consecutive days (after the date of discharge from the
facility) during which the patient was neither an inpatient of a hospital nor an
inpatient of a Skilled Nursing Facility (SNF).
Eligible benefits – A patient is eligible for 100 days of care in a SNF during a
benefit period, as long as medical necessity for the admission and the number of
days has been proven.
Part A services and coverage for Inpatient Care in a Home Health Care:

Covered Medicare Part A home health care services include the following:
• Part-time or intermittent skilled nursing care and home health aid services
• Physical therapy
• Speech-language pathology services
• Occupational therapy
• Medical social services
• Medical supplies
• Durable medical equipment (DME)
Non-covered Medicare Part A Home Health Care services include the following:
• 24-hour-a-day nursing care at home
• Drugs and biologicals
• Meals delivered to the patient’s home
• Homemaker services
• Blood transfusion.
Duration of Care:
Eligibility requirements – The eligibility requirements for home health services are:

• The patient must be homebound
• The home health services must be provided under a plan of care
established and approved by a physician
• The patient must be under the care of a physician
• The patient needs skilled nursing care on an intermittent basis or has a
continued need for physical/occupational therapy or speech-language
pathology services
• The Home Health Agency (HHA) must be acting upon a physician
certification that is part of the plan of care and the agency must meet
certain qualification requirements to be certified under the Medicare
program.

Part A services and coverage for Inpatient Care in a Hospice Care:
Covered Medicare Part A Hospice care services include the following:
• Nursing services
• Doctors services
• Drugs, including outpatient drugs for pain relief and symptom management
• Physical/Occupational therapy and speech-language pathology services
• Home health aide and homemaker services
• Medical social services
• Medical supplies and appliances
• Short-term inpatient care, including respite care
• Counseling
Non-covered Medicare Part A Hospice Care services include the following:
• Treatment other than for pain relief and symptom management of a
terminal illness
• Regular Medicare can usually help pay for treatment not related to the
terminal illness.

Duration of care:
Eligibility requirements – Provided to patients terminally ill with a life expectancy
of six months or less who elect to forego traditional medical treatment for the
terminal illness and elect to receive only limited (hospice) care.
Eligible Benefits – A patient may elect to receive Medicare coverage of four
election periods of hospice care. The periods consist of two 90-day periods, one
30-day period and an unlimited fourth extension period.
MEDICARE PART B
Medicare Part B is also known as Supplemental Medical Insurance (SMI). Medicare
part B typically thought of as insurance for physician services (in both hospital &
non-hospital settings). However, Medicare Part B also covers certain non-
physician services
Medicare Part B coverage:
• Physician Services
• Non-Physician Services
• Diagnostic Tests
• Durable Medical Equipment
• Ambulance Transportation

PHYSICIAN SERVICES
Definition of physician services – For Medicare purposes, a physician is described
as a doctor of medicine; doctor of osteopathy; doctor of dental surgery or dental
medicine; a chiropractor; a doctor of podiatry or surgical chiropody; or a doctor of
optometry legally authorized to practice by a state in which s/he performs this
function.
Scope of Physician Services – The services performed by a physician within the
above definition are subject to any limitations imposed by CMS 1500, the state
licensing agency or the local Medicare contractor on the scope of practice. If any
limitations are placed on the scope of practice, Medicare will only cover items or
services within the limitation. For example, Medicare limits reimbursement for
chiropractors for only spinal manipulation, as long as coverage requirements are
met – based on the scope and limitation of the medical license.
Requirements for coverage of physician services – In order for a physician service
to be potentially covered under Medicare, it must be reasonable and necessary for
the diagnosis or treatment of an illness or injury or to improve the functioning of a
malformed body member.
Covered Medicare Part B physician services include, but are not limited to, the
following:
• Diagnostic tests and procedures that are part of treatment

• X-rays
• Medical and surgical services, including anesthesia
• Drugs and biologicals that cannot be self-administered
• Treatment of mental illness.
Non-covered services – Situations in which an item or service would not be
covered under Medicare Part B include, but are not limited to the following:
• Program exclusions, as designated by CMS 1500
• Medical devices or biologicals which have not been approved by the food
and drug administration.
• Items and services which are determined to be investigational in nature.
NON-PHYSICIAN SERVICES
In addition to physician services, Medicare Part B also reimburses covered items
and services from various non-physician providers. These non-physician providers
include the following types:
• Certified Registered Nurse Anesthetist (CRNA)
• Certified Nurse Midwife (CNM)
• Clinical Psychologist (CP)

• Clinical Social Worker (CSW)
• Physician Assistant (PA)
• Independent Billing Audiologists
• Independent Billing Psychologists
• Independent Practicing independent Physical, occupational and speech
therapists
• Nurse practitioner and
• Clinical Nurse Specialist in collaboration with a physician
Scope of Non-Physician services – The services performed by the above listed non-
physicians are subject to any limitations imposed by CMS 1500, the state licensing
agency or the local Medicare contractor on the scope of practice. If any limitations
are placed on the scope of practice, Medicare will only cover items or services
within the limitation. For example, Medicare limits reimbursement for clinical
psychologists or clinical social workers to services involving treatment of mental
illness, as long as coverage requirements are met – based on the scope and
limitation of the medical license.
Requirements for coverage of non-physician services – In order for a non-
physician service to be potentially covered under Medicare, it must be reasonable
and necessary for the diagnosis or treatment of an illness or injury or to improve
the functioning of a malformed body member.

Covered Medicare Part B non-physician services include, but are not limited to, the
following:
• Diagnostic tests and procedures that are part of treatment
• X-rays
• Anesthesia
• Administration of drugs and biological’s that cannot be self-administered
• Treatment of mental illness
Non-covered services – Situations in which an item or service would not be
covered under Medicare Part B include, but are not limited to the following:
• Program exclusions, as designated by CMS 1500
• Medical devices or biologicals which have not been approved by the Food
and Drug Administrations
• Items and services which are determined to be investigational in nature
Note: All service(s) which are related to a non-covered item or service is /are also
not covered service(s) under the Medicare Program.

Non-covered Medicare Part B non-physician services include, but are not limited
to, the following:
• Acupuncture
• Hearing aids
• Personal comfort items
Note: The local Medicare contractor has the ability and authority to designate an
item or service as non-covered for their service area or jurisdiction. For a
complete list of all non-covered items or services for your state, you should
contact your local Medicare contractor.
Diagnostic Procedures
Diagnostic procedures can be performed in a variety of places, such as
independent laboratories, Independent Diagnostic Testing Facilities (IDTF),
outpatient x-ray and testing facilities and inpatient hospitals (interpretation only).
Keep in mind Diagnostic tests, as with all other services your provide must meet
the regular coverage requirements in order for Medicare to make payment. They
are the item or service must be reasonable and necessary for the diagnosis or
treatment of an illness or injury or to improve the functioning of a malformed body
member. For most diagnostic tests, Medicare contractors develop a list of
diagnoses for which payment will only be allowed. If a claim for a diagnostic test
is received and the indicated diagnosis is not on the list of covered diagnosis
codes, then Medicare will deny the service as not being medically reasonable and

necessary. For a list of diagnostic tests and applicable covered diagnosis codes,
please contact your local Medicare contractor.
Diagnostic Tests
Covered diagnostic tests include, but are not limited to the following:
• X-ray (diagnostic radiology)
• Magnetic resonance imaging (MRI)
• Cat scans
• Diagnostic ultrasound procedures
• Nuclear medicine
• Nuclear imaging procedures
• Organ or disease-oriented panels
• Drug screens
• Clinical pathology consultations
• Individual blood chemistry tests
• Immunology
• Transfusion medicine

• Surgical pathology
Durable Medical Equipment (DME)
include, but are not limited to the following:
• Wheelchairs
• Commode chairs
• Oxygen equipment
• Walkers
• Hospital beds
• Canes
• Nebulizers
Non-covered DME include, but are not limited to the following:
• Bathroom or safety equipment
Duration of care:
Claims for DME are processed by regional contractors (DMERC). You should
contact your local DMERC for further information regarding duration of care.

Note: All DME must be prescribed by a physician.
Ambulance Transportation
In order for Medicare to reimburse ambulance transportation, several coverage
requirements must be met. These coverage requirements include, but are not
limited to the following:
• The ambulance service must be medically necessary and reasonable. To
meet medical necessity, the patient’s condition must be such that use of any other
method of transportation is contraindicated. In any case, in which some means of
transportation other than an ambulance could be utilized without endangering the
individuals health, whether or not such other transportation is actually available,
no Medicare payment may be made for the ambulance service. To meet the
medical reasonableness, the patients diagnosis must warrant ambulance services.
The diagnosis requirement still needs to be met, even though the patient’s
condition may contraindicate the use of other means of transportation.
• The ambulance vehicle and crew must meet Medicare requirements.
Medicare covers ambulance transportation either by land or air. The average
requirements for air ambulance are stricter than land transportation.
Duration of care:

There is no limit to the number of ambulance transports, as long as medical
necessity and reasonableness has been determined and proven.
MEDICARE PART C
Medicare Part C coverage includes:
• Part A Medicare Coverage
• Part B Medicare Coverage
In addition, Part C coverage includes:
• Preventive Care
• Prescription Drugs
• Eyeglasses
• Dental Care
• Hearing Aids

What is hospice?
Hospice is a special way of caring for people who are terminally ill, and for their
family. This care includes physical care and counseling. Hospice care is given by a
public agency or private company approved by Medicare. It is for all age groups,
including children, adults, and the elderly during their final stages of life. The goal
of hospice is to care for the patient and their family, and not to cure the patient
illness.
If a patient qualifies for hospice care, he/she gets medical and support services,
including nursing care, medical social services, doctor services, counseling, &
homemaker services. In many cases, the patient and their family can stay
together in the comfort of their home. Depending on the patient’s condition, they
may have hospice care in a hospice facility, hospital, or nursing home.
Who is eligible for Medicare Hospice Benefits?
Hospice care is covered under Medicare Part A (Hospital insurance). A patient is
eligible for Medicare hospice benefits when:
• Patient is eligible for Medicare Part A (Hospital Insurance);
• Patients doctor and the hospice medical director certify that a patient is
terminally ill and probably have less than six months to live;
• Patient signs a statement for choosing hospice care instead of routine
Medicare covered benefits for terminal illness;

How does hospice work?
Patient’s doctor and the hospice will work with the patient and their family to set
up a plan of care that meets patient’s needs.
For a hospice patient, there is a team of people that will help take care of the
patient. They are:
• Patient’s family
• A doctor
• A nurse
• Clergy or other counselors
• A social worker
• Trained volunteers
Volunteers are trained to help with every day tasks, such as shopping and
personal care services, like bathing and dressing. Speech, physical, and
occupational therapists and other persons who are trained to give care are also
there when required.
A Family member or other person who cares for the patient will be there every day
and members of the hospice team will make regular visits. A nurse and a doctor
are on-call 24 hours a day, 7 days a week to give the patient and their family the

support and care when needed. If a patient should need care in hospital for illness,
the hospice team will help arrange the stay.’
Even though a doctor is a part of the hospice team, patient can choose to use
his/her regular doctor, who is not a part of the hospice to get care. The hospice
will work closely with the patient’s regular doctor to give the care that a patient
needs.
What does Medicare covers?
Medicare covers these hospice services and pays nearly all of their costs:
• Doctor services
• Nursing care
• Medical equipment (such as a wheelchairs or walkers)
• Medical supplies (such as bandages and catheters)
• Drugs for symptom control and pain relief
• Short-term care in the hospital including respite care
• Home health aide and homemaker services
• Physical and occupational therapy
• Speech therapy
• Social workers services

• Dietary counseling
• Counseling to help you and your family with grief and loss
The patient, only have to pay part of the cost for outpatient drugs and inpatient
respite cares.
What is respite care?
Respite care is care given to a hospice patient by another caregiver so that the
usual caregiver can rest. As a hospice patient, you may have one person that
takes care of you every day. That person might be a family member. Sometimes
they need someone to take care of you for a short time while they do other things
that need to be done. During a period of respite care, you will be cared for in a
Medicare approved facility, such as a hospice facility, hospital or nursing home.
What is not covered?
The care that you get for your terminal illness must be from a hospice. When you
choose hospice care, Medicare will not pay for:
• Treatment to cure your terminal illness.
As a hospice patient, you can get comfort care to help you cope with your illness
not cure it. Comfort care includes drugs for symptom control and pain relief, pain
relief, physical care, and counseling and other hospice services. Hospice uses
medicine, equipment, and supplies to make you as comfortable and pain-free as
possible. Medicare will not pay for treatment to cure your illness. You should talk

with your illness; you should talk with your doctor if you are thinking about
potential treatment to cure your illness. As a hospice care and go back to your
regular doctor health plan.
• Care from another hospice that was not set up by your hospice.
You must get hospice care from the hospice provider you chose. You can get
hospice care from another hospice provider, unless you change your hospice
provider.
• Care from another provider that is the same care that you must get from
your hospice.
Your hospice team must give all care that you get for your terminal illness. You
cannot get the same type of care from a different provider unless you change your
hospice provider.
What will I have to pay for hospice care?
Medicare pays the hospice for your hospice care. You will have to pay:
No more that $5 for each prescription drug and other similar products”
The hospice can charge up to $5 for each prescription for outpatient drugs or other
similar products for pain relief and symptom control.
5% of the Medicare payment amount for inpatient respite care For example, if
Medicare pays $100 per day for inpatient respite care, you will pay $5 per day.
You can stay in a Medicare – approved hospital or nursing home up to 5 days each

time you get respite care. There is no limit to the number of times you can get
respite care The amount you pay for respite care can change each year.
Can I keep my Medicare health plan?
Yes. You should use your Medicare health plan (like the Original Medicare Plan or a
Medicare managed care plan) to get care for any health problems that are not
related to your terminal illness. You may be able to get this care from your own
doctor who is not a part of the hospice, or from the hospice doctor. When you use
your Medicare health plan, you must pay the deductible and coinsurance amounts
(if you have the Original Medicare Plan), or the copayment (if you have a Medicare
managed care plan).
• Important information about Medicare Supplemental Insurance:
If you are in the Original Medicare Plan, you may have a medicare Supplemental
Insurance or “Medigap” policy. Your Medigap policy still helps to cover the costs
for the care of health problems that are not related to your terminal illness.
How long can I get hospice care?
You can get hospice care as long as your doctor certifies that you are terminally ill
and probably have less than six months to live. Even if you live longer than six
months, you can get hospice care as long as your doctor recertifies that you are
terminally ill.
Hospice care is given in periods of care. As a hospice patient, you can get hospice
care for two 90-day periods followed by an unlimited number of 60-day periods. At

the start of each period of care, your doctor must certify that you are terminally ill
in order for you to continue getting hospice care. A period of care starts the day
you begin to get hospice care. It ends when your 90 or 60-day period is up. If
your doctor re-certifies that you are terminally ill, your care continues through
another period of care.
As a hospice patient, why would I stop getting hospice care?
Sometimes a terminally ill patient’s health improves or their illness goes into
remission. If that happens, your doctor may feel that you no longer need hospice
care and will not re-certify you at that time. Also, as a hospice patient you always
have the right to stop getting hospice care, for whatever reason. If you stop your
hospice care, you will get your health care from your Medicare health plan, (like
the Original Medicare Plan or a Medicare managed care plan). If you are eligible,
you can go back to hospice care at any time. As a hospice patient, you always
have the right to stop getting hospice care and go back to your regular doctor or
health plan.

MEDICAID
The Medicaid Program provides medical assistance for certain individuals and
families with low incomes and resources. Medicaid eligibility is limited to
individuals who fall into specific categories. Although the Federal government
establishes general guidelines for the program, the Medicaid program
requirements are actually established by each State
Medicaid eligibility is limited to individuals who fall into specified categories. The
federal statute identifies over 25 different eligibility categories for which federal
funds are available. These categories can be classified in to five broad coverage
groups:
• Children;
• Pregnant Women;
• Adults in Families with Dependent children;
• individuals with disabilities;
• and individuals 65 or over

BLUE CROSS BLUE SHIELD PLANS
Blue Cross plans were founded originally to cover hospital expenses. Blue shield
plans were originally established primarily to cover physician services. In most
areas, Blue cross and blue shield plans are a single corporation. In other areas,
they are separate organizations and in some case even compete with each other.
A person becomes a member by entering into a contract with the local Blue cross
and/or Blue shield plan and by paying regular dues. The person becomes a
subscriber not a policyholder and retains a certificate not a policy, that tells him
what to expect from the contract when medical services are required.
When the BCBS plans serve as a Medicare contractor (Medicare HMO), the Blue
Cross staff within the plan handle Medicare Part A as the fiscal intermediary and
the Blue shield staff within the plan handle Medicare Part B as the carrier.
Types of Blue Cross and Blue Shield contracts
There are two basic types of blue cross and blue shield contracts: -
• Service Benefit Contracts - Offered by all BCBS plans that offer physician
participation agreements. The contract provides the covered services
themselves, rather than reimbursing the subscriber for some or all of the
expenses incurred in obtaining covered services. Through physician
participation agreements, a blue cross or blue shield plan secures the
performance of service benefits (i.e. covered services) on behalf of its
subscribers.

• Indemnity Benefit – contracts cover some or all of the actual expenses of
providing covered services but not more than the actual charges for a
specific service. An indemnity benefit contract makes not promise to cover
the full fee. A professional provider may bill the subscriber an amount in
excess of the Plan’s benefit allowance. The subscriber is responsible for any
difference between the plan’s allowance and the professional provider’s bill.
TRICARE (CHAMPUS)
Tricare is the Managed healthcare program for Active Duty service members and
retirees and their families.
Tricare formerly CHAMPUS is the Managed care program for DoD beneficiaries.
Through the 3 tricare programs Standard, Extra and Prime, Military Treatment
Facilities MTF and Civilian providers work as partners to help control the overall
cost of healthcare. TRICARE is administered by regional Managed care Contractors
to provide you with an appropriate balance of cost, access and quality.
The TRICARE programs are available to family members of active duty military
service members and also to military retirees and their dependents. These
dependents include spouses, unmarried children under age 21, unmarried children
who are full-time students under age 23 and stepchildren adopted by the sponsor.
Those who are eligible must be listed in the Defense Department's worldwide,
computerized database DEERS (Defense Enrollment Eligibility Reporting System).
The following are not eligible for TRICARE benefits:
• People age 65 or older who are eligible for Medicare (with some exceptions)

• Parents and parents-in-law of active duty service members or retirees
• People who are eligible for health benefits under CHAMPVA (Civilian Health
and Medical Program of the Department of Veterans Affairs)
The Defense Enrollment Eligibility Reporting System (DEERS) is a military
database that lists everyone who is eligible for TRICARE benefits. Make sure your
DEERS record is up-to-date. This will help us process your claims quickly and
accurately.
RAILROAD MEDICARE
The Railroad Retirement Board’s mission is to administer retirement/survivor and
unemployment/sickness insurance benefit programs for railroad workers and their
families under the Railroad Retirement Act and the Railroad Unemployment
Insurance Act. These programs provide income protection during old age and in
the event of disability, death or temporary unemployment and sickness. The
Railroad Retirement Board also administers aspects of the Medicare program and
has administrative responsibilities under the Social Security Act and the Internal
Revenue Code.
The ID format is one or two alpha’s followed by 8 numeric.
Medicare - Blue Cross and Blue Shield Plans have served as partners to the
federal government in administering the Medicare program since its inception in
1966. Blue Plans helped design the original infrastructure for tracking and
processing Medicare payments. Today, the Blue System collectively is the largest
single processor of Medicare claims - handling more than 90 percent of claims

from hospitals and institutions (Part A) and nearly 60 percent of claims from
physicians and other health care practitioners (Part B).
National Accounts – This is a program that covers the employees of a company
that has offices, plans and people in several states and whose employees travel a
great deal or change location frequently. The Identification number on the
subscriber’s card indicates this is a National account. Claims are filed and paid by
the local plan where the treatment was rendered.

DISABILITY INSURANCE
Disability insurance replaces incomes which individual lose if he has a long-term
illness or injury and cannot work. This is an important type of coverage for
working-age people to consider. Disability insurance does not cover the cost of
rehabilitation if an individual is injured.
Some employers offer group disability insurance and this may be one of the
benefits where individual work. Or the individual might be eligible for some
government-sponsored programs that provide disability benefits. Many different
kinds of individual policies are also available.
WORKMEN’S COMPENSATION INSURANCE
This insurance policy protects the insured party from legal liabilities against injury
or death of any of his employees who is a "workman" as defined by the
Workmen's Compensation Act. Workers hurts on-the-job are protected by workers’
compensation insurance. Oregon law requires employers to insure their
employees.
With rare exceptions, Oregon has a "no fault" system, which means both workers
and employers are protected from the time and expense of determining who
caused an on-the-job accident. It is the workers responsibility, however, to prove
that an injury or disease is job related rather than substantially related to a
diagnosed pre-existing condition.

This insurance policy is necessary for every employer since it indemnifies him
against his legal liability as an "employer" towards accidental or fatal injuries
sustained by his work men during work.
The actual cost of workers’ compensation insurance coverage is paid totally by
employers to the insurance company the employer selects. The amount the
employer pays depends primarily upon a worker’s job. A hazardous job costs more
to insure than a less hazardous job. For example, a roofing company may pay
$14.31 for workers’ compensation insurance for every $100 earned by each of its
roofers, but just 18 cents for every $100 earned by its bookkeeper. On extra
payment of premium, medical, surgical and hospitalization expenses including
transportation costs are also covered.
Liabilities that may arise owing to diseases mentioned in Section III (C) of
Workmen's Compensation Act during the course of employment are also covered.
Some common things regarding Workers Compensation-
A worker's paycheck shows a deduction for "workers’ compensation."
What is this for?
The payroll deduction is the Department of Consumer and Business Services’
cents-per-hour assessment. Both workers and employers are assessed equal
amounts for each hour the employee works. The money is collected by the
Department of Revenue and is passed on to the Department of Consumer and
Business Services (DCBS) -- the state agency that oversees the Oregon workers’
compensation system. The assessment goes to special funds the DCBS

administers and is used to provide incentives to rehire injured workers and to
ensure that benefits paid to injured workers and workers’ beneficiaries keep pace
with the cost of living.
Why do employers care about on-the-job injuries, if insurance covers
those injuries?
Employer’s care for several reasons:
No employer wants to see anyone get sick, hurt or injured on-the-job.
Employers don’t want to lose valuable, trained employees. The most valuable
resource a business has is the people who work there.
Injuries cause rates to increase. Individuals may have to pay more for car
insurance if they are in an automobile accident. Similarly, employers may have to
pay more for insurance or may even have coverage canceled, if there are too
many injuries in the workplace.
There are many indirect costs associated with accidents. For example, there may
be lost production time and damage to machinery, which are costs not covered by
insurance.

What are workers supposed to do if they are hurt on-the-job?
They should report their injury to their employers or supervisors immediately.
They will help their workers get appropriate medical treatment, if necessary.
The worker and employer must then file a workers’ compensation claim for
benefits if the worker sees a doctor for medical treatment or missed time from
work. The claim is filed by completing a Report of Occupational Injury or Disease
(Form 801) available from the employer. Workers must complete page 2, then
give the form to the employer who will complete page 1. The employer will send
both pages to the insurance company. If the worker is in the hospital or cannot
complete the form due to injury, the employer can send it to the insurer without
the worker’s signature. The employer should give the worker a copy of the
completed form.
Workers should be sure to tell their doctors that the injury happened on the job
and the name of the company that insures the employer. The doctor is required to
file a report and will ask the worker to sign a portion of the form.
If the employer is enrolled in a managed care organization (MCO) service area, he
or she provides the worker with a list of doctors who are authorized to treat
injured workers under the contract. A worker’s family doctor or authorized nurse
practitioner may also be permitted to treat by the MCO. Employers will provide
workers with additional information, if necessary.

What kinds of injuries or illnesses qualify for workers’ compensation
benefits?
Generally, any injury that occurs while working (or illness due to work) that
requires the worker to see a doctor or results in disability or death may qualify for
workers’ compensation benefits. An injury could be traumatic (caused by an
accident), cumulative (caused by repetitive motion) or an occupational disease
(such as loss of hearing). A doctor must be able to verify that there is objective
medical evidence showing that an injury or disease exists and that work exposure
was the major cause.
How does a worker get benefits when hurt on-the-job?
If SAIF is the employer’s workers' compensation insurance company, we will begin
evaluating the claim as soon as it is received. We will notify the worker and
employer in writing when the claim has been accepted or denied. A claim number
will be assigned to the claim. A claims adjuster may contact the worker by
telephone or in writing to ask questions about the claim. Workers should have
their claim number with them when they complete any forms, see the doctor or
call SAIF. Having the claim number available will also help workers get their
questions answered quickly.

What does "deferred" mean?
It means the claim has not been accepted or denied. No decision has been made
yet.
A claim is considered to be "deferred" while it is being evaluated.
While a claim is deferred (and also when a claim is accepted), workers will receive
wage replacement benefits, if the doctor states that the worker cannot work, and
the worker is unable to work for more than three days. These benefits will not be
paid if the claim is denied within 14 days of the day the injury was reported to the
employer.
Who pays for medical expenses if the claim is deferred?
No one should pay for medical expenses while the claim is in a deferred status. If
SAIF accepts the claim, we will pay for medical care related to the claim. If the
claim is denied, the worker or the worker’s private health insurance carrier will be
responsible for medical expenses. However, as of January 1, 2002, a claim that is
denied and is on appeal will be processed by the health insurance company,
provided the worker has coverage. However, if there is a balance remaining, the
medical provider can bill the workers compensation carrier, who will pay up to the
fee schedule for certain types of medical services prescribed to reduce pain,
diagnose the condition or prevent disability. If the claim denial is ultimately
upheld, the amount paid to the medical provider can be held as an overpayment
and deducted from future workers’ compensation benefits with the same insurer.

By law, if the worker is receiving medical care in Oregon, the doctor may not seek
payment from the worker for the medical treatment related to the claim during the
time the claim is being evaluated or if the claim is accepted. It is also important to
know that during the time the claim is being evaluated (deferred), SAIF will not
make payment for any medication the doctor may prescribe or for any other
expenses such as transportation costs for visits to the doctor’s office. Workers
should keep receipts for these expenses, as they will be paid by SAIF, in addition
to related medical bills, if the worker’s claim is accepted. If SAIF sends a worker
for an evaluation during this "deferred" period, we will reimburse expenses to
attend the appointment(s).
How do workers get reimbursed for prescriptions that they pay for?
Workers may send their prescription receipts to their claims adjusters for
reimbursement. Pharmacies can direct bill SAIF for most future prescriptions.
Workers may contact us to verify whether a pharmacy participates in our
pharmacy program.
When will the worker receive a wage replacement check?
If SAIF has received notification of the injury, the initial check will be mailed no
later than 14 days from the date the worker informed the employer of the injury
or became unable to work because of the injury, unless the claim is denied by the
14th day. Subsequent checks are mailed about every two weeks. An attending
physician or authorized nurse practitioner must authorize these benefits.

How long do wage replacement checks continue?
The wage replacement benefit checks will continue until one of the following
occurs:
The worker returns to regular work;
The worker’s doctor releases him/her to return to regular work; or
The doctor approves a written offer of modified work by the employer, but the
worker refuses to take it, and the wage offered is equal to or greater than the
wage at injury.
The worker returns to modified work and receives the equivalent of a regular
wage. The claim is closed.
SAIF may ask the worker to verify earnings after returning to modified work to
ensure that he/she is receiving the correct amount of wage replacement. A prompt
response will ensure there is no interruption in benefits.
What is the amount of the wage replacement check?
In most cases, the check will be for two-thirds of the worker’s weekly wage up to
a maximum. For dates of injury on or after January 1, 2002, the maximum is
133% of the Oregon average weekly wage. There is usually a deduction for the
three-day wait that is not paid in the first check.

Why is there a three-day wait?
The three-day wait is required by state law and acts as a form of "deductible."
If the worker’s physician authorizes temporary total disability for 14 consecutive
days or if the worker is hospitalized as an inpatient during the first period of
disability, wage replacement benefits are paid back to the first day the worker
missed work.
How much is the maximum compensation?
Wage replacement checks will generally be equal to two-thirds of the worker’s
weekly wage, up to the maximum that is 133% of Oregon’s average weekly wage.
(If your date of injury is prior to January 1, 2002, your maximum is 100% of the
Oregon average weekly wage.) This maximum is calculated annually using figures
from the state Employment Department. The minimum for any injured worker is
$50 per week or 90 percent of the worker’s weekly wage, whichever is less.
When will the claim be accepted or denied?
A claim is evaluated and accepted or denied as quickly as possible. Sometimes
your adjuster may need additional medical information or must request an
investigation. This may cause a delay in the decision to accept or deny a claim. By
law, insurers have 60 days from the time your employer knew of the injury to
make this decision. (If your date of injury is prior to January 1, 2002 we have up
to 90 days.)

What are the worker's responsibilities if a claim is denied?
The worker has 60 days to appeal a denial. If a claim is denied and that denial
becomes final, the worker will be responsible for payment of all medical bills. The
worker may bill his/her private health insurance company for medical treatment if
the claim is denied by sending a copy of the denial to them.
According to Oregon workers’ compensation law, it is up to the injured worker to
prove that an injury occurred on-the-job or that an illness was due to job-related
factors. Workers who file a workers’ compensation claim for an injury that they
know occurred off-the-job or attempt to collect wage replacement and benefits for
one job while failing to report earnings at another may be committing fraud and
could be prosecuted. For dates of injury after January 1, 2002, some medical
benefits may be paid while the claim is on appeal. Contact your adjuster if you
need more information on these benefits.
What are the worker's responsibilities if a claim is accepted?
A SAIF claims adjuster is available to assist the worker with his/ her claim.
Workers should be sure to ask questions if they don’t understand something or
receive any forms or letters that are confusing. Workers should also keep their
claims adjusters up to date on their recovery progress. The adjuster is there to
help.
It is the worker’s responsibility to do all he/she can to return to work. Workers
should cooperate fully with those who are helping to return them to work. They

should keep their medical appointments and follow their doctor’s instructions and
treatment plan. They should avoid any activities that will slow or stop recovery.
It is important for workers to keep their employers informed about their condition.
Employers need to know what the worker’s doctor reports after each medical visit.
When the doctor releases the worker for work, the worker must contact the
employer immediately. Workers should be sure to obtain a written copy of the
work release to give to the employer.
What happens to the worker’s job if he/she can’t work?
The intent of the workers’ compensation system is to help injured workers get
back to work. Workers have a responsibility to make every effort to return to work
once they are able. Employers may also ask an injured worker to return to a
different job while they are healing. Studies show that most injured workers
recover more quickly when they can return to the workplace.
If the worker is unable to return to his/her old job and has a permanent disability,
he/she may be eligible for the Preferred Worker Program that provides financial
incentives to employers who hire injured workers with permanent disabilities. The
Department of Consumer and Business Services will notify workers if they are
eligible or they can contact the Department directly at 1-800-445-3948 to inquire
about this program.

Will the worker get retrained?
Retraining is one of the last options exercised to get an injured worker back to
work. In most cases, re-employment depends upon the worker’s existing skills and
physical capabilities. If a worker believes his/her injury will prevent him/her from
returning to any employment he/she has held in the past, the worker should
contact SAIF to review eligibility for vocational benefits.
Why do insurers send out all that paperwork inquiring about a worker’s
medical and work history?
This information is needed to ensure that the benefits the worker receives are
appropriate and to determine his/her eligibility for vocational assistance or
permanent partial disability.
Who should a worker call if he/she has questions about workers’
compensation?
Employers can certainly help answer questions workers may have. Any worker
who has filed a claim with SAIF should contact us at 1-800-285-8525. They can
also call the Department of Consumer and Business Services Injured Workers'
Hotline at 1-800-452-0288 or the Ombudsman for Injured Workers at 1-800-927-
1271.

HOSPITAL INDEMNITY INSURANCE
This insurance offers limited coverage. It pays a fixed amount for each day, up to
a maximum number of days. An individual may use it for medical or other
expenses. Usually, the amount the individual receive will be less than the cost of a
hospital stay. Some hospital indemnity policies will pay the specified daily amount
even if patient has other health insurance. Others may coordinate benefits, so that
the money patient /insured receive is not equal / more than 100 percent of the
hospital bill.
LONG-TERM CARE INSURANCE
Long-term care insurance is designed to cover the costs of nursing home care,
which can be several thousand dollars each month. Long-term care is usually not
covered by health insurance except in a very limited way. Medicare covers very
few long-term care expenses. There are many plans and they vary in costs and
services covered, each with its own limits

Understanding Health Insurance Terms
Coinsurance
The amount patient / insured is required to pay for
medical care in a fee-for-service plan, after deductible
have been met. The coinsurance rate is usually
expressed as a percentage. For example, if the
insurance company pays 80 percent of the claim, patient / insured pay 20 percent.
Coordination of Benefits
It is a system to eliminate duplication of benefits, when an individual is covered
under more than one group plans. Benefits under the two plans usually are limited
to no more than 100 percent of the claim.
Co-payment
It is another way of sharing medical costs. Here Individuals pay a flat fee every
time he receives medical service. (For example, $5 is paid for every visit to the
doctor). The insurance company pays the rest.
Covered Expenses

Most insurance plans, whether they are fee-for-service, HMOs, or PPOs, do not pay
for all services. Some may not pay for prescription drugs. Others may not pay for
mental health care. Covered services are those medical procedures the insurer
agrees to pay for. They are listed in the policy.
Customary Fee
Most insurance plans will pay only what they call a reasonable and customary fee
for a particular service. If patient’s doctor charges $1,000 for a hernia repair while
most doctors in that area charge only $600, patient will be billed for the $400
difference. This is in addition to the deductible and coinsurance which patient is
expected to pay.
Deductible
The amount of money insured must pay each year to cover medical care expenses
before insurance policy starts paying.
Exclusions
Specific conditions or circumstances for which the policy will not provide benefits.

HMO (Health Maintenance Organization)
Prepaid health plans. Insured pay a monthly premium and the HMO covers
doctors' visits, hospital stays, emergency care, surgery, checkups, lab tests, x-
rays, and therapy. Insured must use the doctors and hospitals designated by the
HMO.
Managed Care
Ways to manage costs, use, and quality of the health care system. All HMOs and
PPOs, and many fee-for-service plans, have managed care.
Maximum Out-of-Pocket Expenses
The most money insured will be required pay a year for deductibles and
coinsurance. It is a stated dollar amount set by the insurance company, in addition
to regular premiums.
PPO (Preferred Provider Organization)
A combination of traditional fee-for-service and HMO. When patient use the
doctors and hospitals that are part of the PPO, he can have a larger part of
medical bills covered. Patient can use other doctors, but at a higher cost.
Pre-existing Condition
A health problem that existed before the date insurance became effective.
Premium

The amount which insured or his employer pays in exchange for insurance
coverage.
Primary Care Doctor
Usually patient’s first contact for health care. This is
often a family physician or internist, but some women
use their gynecologist. A primary care doctor monitors
health and diagnoses and treats minor health
problems, and refers the patient to specialists if another level of care is needed. In
many plans, care by specialists is only paid for if the patient is referred by primary
care doctor. An HMO or a POS plan will provide a list of doctors from which patient
will choose primary care doctor (usually a family physician, internists, obstetrician-
gynecologist, or pediatrician). This could mean patient might have to choose a
new primary care doctor if his current one does not belong to the plan. PPOs allow
members to use primary care doctors outside the PPO network (at a higher cost).
Indemnity plans allow any doctor to be used.
Provider
Any person (doctor, nurse, dentist) or institution (hospital or clinic) that provides
medical care is called an provider.
Third-Party Payer
Any payer for health care services other than the patient / insured. This can be an
insurance company, an HMO, a PPO, or the Federal Government.

MEDICAL BILLING – AN INTRODUCTION
What Is Medical Billing?
Medical billing is better described as full medical practice management and a
doctor's key to getting paid. Full medical
practice management," meaning that billing
office handle all the bookkeeping and
accounting functions for their doctor-clients,
including patient statements, recording
payments, preparing financial reports, and
even consulting the physicians on issues such
as how to negotiate contracts with the growing number of managed care
companies such as HMOs and PPOs that are trying to reign in doctors' fees.
Medical billing involves preparation of medical bills on behalf of the doctor for the
treatments performed on the patients. The work also involves sending the
medical bills to the respective insurance company with whom the patient is a
beneficiary. The billing department also collects the money from the insurance
company on behalf of the doctors. The insurance company pays for the treatments
billed by the billing office.
The Medical Billing industry is a subsidiary of the Health care industry. Medical
Billing is the financial-data management of a physician or a group of physicians’
practices. This means maintaining all of the physician’s non-medical records and
keeping track of and collecting all money due to him.

What are the basic differences between US & Indian medical
payment collections?
To understand “Medical Billing”, it is important to first understand the difference
between medical payment collections in India as opposed to the collections policies
in the U.S. There are two basic differences
1. The first difference is that few people in India have a medical insurance
policy. They pay their medical fee out of their pockets immediately after their visit
to the doctor. On the other hand, a large percentage of the American population
had Medical Insurance Policies to cover their medical bills. In addition, most
physicians extend credit. In short, insurance companies pay most medical bills,
and they do this, at an extended period from the date of treatment.
2. Even if a person has a medical insurance policy in India, and if his policy
covers his treatment, he has to pay the medical bill out of his pocket at the time of
his treatment. His insurance company then later reimburses him. In the U.S, the
patient undergoes his treatment, gives all relevant information regarding his
insurance policy or policies at the physician’s office and leaves. According to
American law, it is the physician’s responsibility to collect the money from the
government insurance programs. Most physicians take the responsibility of
collecting payments due from the private insurance companies also as an added
service to their patients.

The client of a Billing Office may be one physician, a group of physicians working
in the same hospital practicing different specialties (Ophthalmology, Anesthesia,
etc.) or a group of physicians practicing the same specialty.
Why Physicians go for Medical Billing Companies to do billing?
America has more than 3000 insurance companies, each with a number of plans.
This posed a problem to the physicians. Every insurance company required the
medical claims filed to them according to their own rules and formats. Also, when
physicians sent out claims to these insurance companies the explanation of the
diagnosis and the treatment, necessary to every claim, were voluminous and time
consuming.
The forms and codes developed by Center for Medicare and Medicaid Services
(CMS – formerly known as HealthCare Financing Administration CMS) reduced the
volume of the information to be transferred to the insurance companies but the
volume was still considerable and required skill and time. The medical treatment
performed still had to be encoded. These codes, with the patients’ demographic
information, still had to be entered into specific medical billing software’s. This
process was again time consuming and the extra personnel and infrastructure
meant extra costs. They could not handle the volume and turned to specialist
billing offices for assistance.
It was easier for a physician to source their non-medical, accounting work to a
billing office so that he could concentrate on his practice. Thus the medical billing
office became an intermediary between the physician and the insurance
companies.

The billing office collects information relevant to the patients’ treatment from the
physicians’ office. Using these codes and forms, the billing office bills the
insurance companies and patients on behalf of the physicians. Until recently,
medical billing was usually done by typing out and mailing claims to various
insurance companies. Now the objective of the medical billing industry is to offer
fast, efficient, and error-free claims processing using computers to log and
transmit claims to the insurance companies.
What is a Claim?
A claim is a request made to the insurance company, by the billing office on behalf
of the insured person or the physician, for reimbursement of services rendered by
the physician. A claim is sent out on standardized forms that contain information
regarding the patient, his insurance coverage, the physician, the diagnosis and the
treatment. A claim is either mailed or electronically transmitted to an insurance
company.
In a small family practice or suburban clinic this task may be simple and assigned
to the medical assistant or nurse but in bigger practices and clinics this is the
medical biller's job! When a physician treats a patient, the doctor’s office must file
an insurance claim to get paid. This claim is usually filed on paper and sent by
mail. These paper claims are notoriously slow, often taking 60-90 days or more for
the doctor to get paid.
Now, these claims can be processed electronically, saving healthcare provider’s
time and money. With electronic claims processing, payment time is drastically
reduced to just 7 to 21 days on average. This dramatic improvement in cash flow

is exactly why medical billing is in such demand. Physicians are constantly seeking
remedies to their medical billing difficulties.
A brief study on working of Medical billers?
Medical billers and coders usually work forty regular office hours from Monday
through Friday on a desk in the billing office or billing department of the
professional healthcare office. They must know the different methods of billing
patients, understand various collection methods, ethical and legal implications
have a good working knowledge of medical terminology, anatomy, medical billing
and claims form completion, and coding.
They also must understand database management, spreadsheets, electronic mail,
and possess state-of-the-art word processing and accounting skills, be proficient in
bookkeeping, and be able to type at a speed of at least 45 words-per-minute.
The work area of medical billers and coders usually is in a separate area away
from the patients and public eye. However, even though they are not involved in
the actual process of doctors and healthcare professionals providing medical care
they need to possess excellent customer service skills when it comes to making
contact with clients, insurance companies, and often patients. Medical billers must
know how to explain charges, deal with criticism, give and receive feedback, be
assertive, and communicate effectively without becoming confused as the person
is asking questions. Patients can quickly become frustrated when trying to deal
with healthcare providers and bills over the phone.

While an increasing amount of patient care is being funded through HMO (Health
Managed Organizations) related insurance, where the patient makes a small co-
payment at the time of service and the doctor bills the managed care company for
the balance, a number of patients still need to make arrangements to pay for their
medical services over a period of time. Part of the medical biller and coder's job is
to contact some of these patients from time to time regarding a past due bill.
Incoming calls from patients who have questions regarding a bill are also directed
to the medical billers office. The way s/he communicates over the phone can make
or break business relationships.
Other specialties closely related to the medical billing profession are:
• Medical Coders/Coding Specialists
• Patient Account Representatives
• Electronic Claims Processors
• Billing Coordinators
• Reimbursement Specialists
• Claims Assistant Professionals
• Medical Claims Analysts
• Medical Claims Processors
• Medical Claims Reviewers
• Medical Collectors

What are the various departments in an Indian billing
office?
Billing office is a link between the Doctor and the insurance company. The billing
office in India has four departments put together, they are:
1. Scanning Department
2. Charge Entry Department
3. Cash Department
4. Accounts receivable department
5. Quality Department
Scanning Department
This department is responsible for collecting the data scanned from the US billing
office. The US office in turn receives the data from the physician’s office,
insurance companies, and patients. The data received in US is scanned to back
office in India. The data sent to us involves the details of the patients and
treatments taken at the hospitals. (Patient Demographic & charge sheets). These
data are handled by the charge entry department. The second form of data is the
data sent to us by the insurance companies. The data contains the benefit paid to
the respective patient’s by the insurance companies and this data is handled by
the cash department. The third form of data is called the regular mails and this
comes from the insurance companies and this is handled by the accounts
receivables.

The scanning department receives and allocates all the data received by them to
the respective departments.
Charge Entry Department
This department is responsible for registering the patients in the system before
entering the charges.
Each type of ailment or disease has a unique diagnosis code called ICD-9 code
(International Classification of Diseases 9th Edition Clinical Modification) and each
type of ailment requires different modes of treatment procedures. The procedures
involved in the treatments are noted by unique codes called the CPT (Current
Procedural Terminology). code (Procedure code)
The charge sheets notify the various treatments performed on a patient. The
charge entry department enters these procedures into the respective patient
account. These details are collected and entered by the billing office and the
copies of these claims are sent to the insurance companies. The mode of sending
the claims to the insurance companies can be by mail or by electronic
transmission. Insurance companies take on an average time period of 30 days to
process the claims.
Patient Demographics & charge entry is the first step of the billing process and an
error here will prompt errors in the subsequent steps. In some cases this error
can be discovered only after the claims reach the insurance carriers. This will
result in lost accounts receivables time. Hence utmost care should be taken while
entries are being made.

Cash Department
This department is responsible for entering the cash details into a particular
account. The check and the explanation of benefits (EOB) are sent to us by the
insurance companies. Check contains the providers or group name, amount paid
and the insurance company’s name. EOB contains the detailed description of the
payments made for the type of procedures involved in the treatment. In case of a
denial, an EOB alone is sent and it explains which charge has been denied and for
what reason. EOB will be used to verify any discrepancies from the expected
payment.
When a claim has been processed and paid, the amount paid will have to be
applied to the amount charged for individual patient’s treatment in the Medical
billing software. This makes it possible for the billing office to track the payments
received from different angles. Some examples of how a billing office would want
to track the payments received are:
a) All insurance payments for a doctor or a group
b) All patient payments for the doctor or group
c) Total payments made for all patients or any group of patients (grouped by
insurance company, date etc)
d) Payment made for any specific treatment for a patient
e) Payments made by an individual patient or insurance company
f) All payments made for one particular treatment that the physician renders.
(total revenue earned from heart operations alone for an cardiologist)

Cash posting or the correct application of payments to their respective charges in
the medical billing software is very important as any wrong posting may result in
wrong accounting. If there are any mistakes in posting, the reports that are run
to assess a physician’s practice or judge the billing office’s performance will be
incorrect.
EOB’s are the only hard copy evidence the billing office have to check how the
insurance company had processed the claims sent to them and it has to be filed
carefully for future references.
Accounts Receivables Department
This department has to check for the steady inflow of money from the insurance
company. The main motive of this department is to collect money for all the
treatments taken by the patients. Usually the turn around period for the payment
by the insurance company is 30 – 45 days. Once the limit is exceeded AR
department has to make an enquiry for the delay. There are various reasons for
the delay like:
a) Correct details may not have been provided to the insurance companies.
b) Claims were sent correctly but Insurance Company may not have received
the claims.
c) The checks issued might have been sent to the wrong address.
d) The insurance company may delay the payments if they have a backlog and
they would inform us by a letter that they have received the claims and
would be making the payments shortly.

AR department acts as a hub around which other departments have to revolve.
This department can gather & update lot of billing information which is required to
settle a claim. There are instances where insurance company does not make a
100% payment and we would have received a low payment, in such case AR
analyst have to work on such claims & settle the claim.
The Medical billing software is capable of running reports that pull out claims that
are unpaid for greater than 30 days. These are calling aging reports and show
pending payments in slots such as 0 – 30 days, 31-60 days and 61-90 days.
Claims filed within the last 30 days will find themselves in the first slot (0-30days).
Claims that are more than 30 days but less than 60 days old will be found in the
31-60 days slot. A glance at this report will show the AR personnel the claims that
need to be followed up on with the insurance company.
Claims will be followed up over the telephone or by written correspondence. It
would be necessary to find out why the claims are yet to be paid and what needs
to be done to have these claims paid. The delay and denials will be corrected by
the billing office in coordination with the physician’s office and the insurance
carriers. The same applies when patient billing statements are sent out. The
patient is given 3-4 weeks to pay the bill and if the payment is not received with in
that time, the billing office will follow up with the patient.
Communication is very important between the three departments. There will be a
number of circumstances where these departments will have to work with each
other to troubleshoot problem claims. Only good coordination between these
departments will assure correct and quick payments from both the insurance
companies and the patients.

Quality Department
Quality in Health care business can be defined in two words first “
Accuracy “ ( Defect free transaction ) where in data captured in the software is
accurate with the information received, this will also enable the claim to be paid
within the given time period. Next comes “Timely Response i.e., work received
has to be completed within the stipulated time period as agreed with the client.
In the competitive world of Healthcare BPO Environment today, Quality Process

plays a vital role to ensure that a clean claim is being transmitted/forwarded to
the Insurance carrier. Quality check is done based on General rules and specific
rules given by the client from time to time. Quality check is maintained in all
departments of Medical Billing by laying down rules for each department and
thereby arresting the errors to minimum level.
In the absence of correct checks and balances, companies can run the risk of
jeopardizing their relationship with customers through the inability to provide
continuously good service.
The project is initiated with formal identification of the Project Manager, allocation
of project resources, and overall establishment of the project environment and
preparation of Project Development and Quality Plan. Continuous Project
monitoring is done through various levels of quality reviews. The project manager
ensures a smooth interaction with the customer through e-mails, teleconferences
and Weekly Progress Reports.

Quality Check List
Demos:
Patient Details:
1. Patient Account Number.
2. Patient Name: Last name, First name Middle Initial
3. Patient DOB: MM/DD/YYYY
4. Patient SSN: 9 Digits Numeric
5. Patient Sex: Male/Female
6. Patient Marital Status: Married/Single/Others
7. Patient Address:
Physical Address/Mailing Address
City, State, Zip Code
8. Patient Ph#: 10 digits
9. Employer Details.
Guarantor Details:
1. Guarantor Name.
2. Guarantor Address
3. Guarantor Phone#.
Insurance Details:
Primary Insurance:
1. Plan Name.
2. Insurance Address
3. Policy Number

4. Group Number
5. Subscriber
6. Relationship code
Secondary/ Tertiary same details need to be checked.
Charges:
1. Date of Service (From Date; To Date)
2. Place of Service
3. Facility
4. Referring Doctor
5. Provider
6. Procedure
7. Modifiers
8. Diagnosis
9. Units
10. Billed Amount

What are the problems faced by US providers or
physicians?
Constantly US physicians face the problems of insurance coding & payment
reimbursement on their insurance claims. Optimizing reimbursement is like trying
to piece together a puzzle with a lot of pieces. Not only is there a lot of
complexity, but change is continuously occurring. There are a number of
important factors, few are outlined below.
1. Providers are using invalid, obsolete or deleted codes while submitting claims to
respective insurance carriers.
2. The code and fees may be okay, but providers may be losing charge
information, missing super bill fees or billing insurance carriers wrongly or
irregularly.
3. The practice is not well-informed about current coding and billing issues.
4. The practice doesn't have and/or doesn't follow written policies and procedures
which support the billing, coding and collections processes.
5. Not participating in Medicare may allow providers to bill higher fees to patients,
but this may not be in the best interests of their practices.
6. Poor understanding of how insurance carriers work and ineffective strategies
and systems for dealing with them.
7. The practice is not using forms and documents which are current.
In general, the basic tools needed by health care providers for optimizing
reimbursement are:
1. A thorough understanding of the billing process and related terminology.

2. Procedure coding and diagnostic expertise.
3. A well-designed super bill.
4. A fee schedule based on relative values.
5. Current and accurate forms and documents.
6. Current reference materials (such as code books).
7. Written policies and procedures covering billing guidelines.
What is the normal work flow process in Medical billing?
The following brief outline would give the workflow process from the time a patient
is seen by a physician.
1. The doctor sees the patient. Demographics, super bills/charge sheets,

insurance verification data and a copy of the insurance card i.e. all the information
pertaining to the patient is sent to the Billing office.
2. Billing office scans the source documents and saves the image file to an FTP
site or on to their server under pre-determined directory paths.
3. Scanning department retrieves the files and prints them and ties up with
the control log for number of files and pages. (This process is absent if a billing
office opts for data entry thru electronic source documents)
4. Illegible /missing documents are identified and a mail is sent to the Billing
office for rescanning.
5. Documents are batched, numbered and sent to the appropriate departments

for action
6. Coding and pre-coding of the super bill/charge sheet and demographics for
insurance, doctors, modifiers, CPT and diagnosis are done wherever required.

7. The claims data entry operator creates a charge, according to the billing
rules pertaining to the specific carriers and locations .All charges are accomplished
within the agreed turnaround time with the client.
8. Charges are checked for accuracy and again verified by audit department
for accuracy and compliance with rules.
9. Claims are filed and information sent to the Transmission department.

Transmission department prepares a list of claims that go out on paper and
through the electronic media. Once claims are transmitted electronically,
confirmation reports are obtained and filed after verification. Paper claims are
printed and attachments done, if necessary, stuffed into envelopes and sent to the
US for postage and mailing. Transmission rejections are analyzed and appropriate
corrective action is taken.
10. Cash Application team receives the cash files and the deposit control log is
prepared. This helps to reconcile the deposits at the end of each month. During
cash application overpayments are immediately identified and necessary refund
requests are generated for obtaining approvals. Also underpayments/denials are
highlighted for further research by the denied claims team.
11. All denied codes in the EOB’s or Explanation of Benefits received are
researched by the rejected/denied claims group, which will determine the reason
for denial, and appropriate action is initiated for resolving the issue. This group
also researches the regular mail received from the insurance companies and
appropriate actions are taken on the refund request, newsletters, rejection reports
etc.
12. AR analysts are the key to any group. They record the processing time of
each insurance companies and identify all claims falling above the processing time.

Then the claims are researched for completeness and accuracy and insurance
carriers are called if required. AR analysts are responsible for the cash collection
and resolving all problems to enable the account to have clean AR.
13. Insurance calling team initiates calls to the insurance companies to establish
reasons for non-payment of the claims. All reasons are passed on to the Analysts
for resolution. Calling team works during the American Time zones.
14. Patient calling team calls up the patients to confirm receipt of bill and when
they are going to pay. Based on client’s approvals budget plans and discounts for
immediate payments are also undertaken.
Below chart will clearly demonstrate the actual flow of medical billing process.
Process starts right from the stage of patient demographic entry at the physician’s
office by the patients.

PD & Charges PD & Charges PD & Charges from PD & Charges from
from Facility I from Facility II Facility III Facility IV
All the Scanned documents are received,

PD & Charge sheets received from checked with Scan logs and forwarded to
all four facilities are received, respective entry departments
batched & Scanned to Back Office
Patient Demographics & Charges are

Patient Demographics and coded in Coding Department
Charges are entered as per rules
Entries are updated and Claims are filed

Entered demographics & Charges to Insurance Carriers
are quality checked based on entry
guidelines.
Electronic Claims are sent to

Paper Claims are sent
Claims Insurance Carriers
Claims to Insurance
Submission via Clearing house
Submiss Carriers via U.S
ion Mail
If a claim is still outstanding, calls

After 30
After 45 are placed to Insurance Carriers to B
A Days
Days check status of the claims
Claim Claim Not

Low paid Claim Claim
Paid In System
Claim Denied Pended
Claims needs to be Analyst needs to review each

Cash posting
resubmitted after situation and take appropriate actions
proper verification to settle claims
If secondary or tertiary
Other
Insurance available, Client Adjustments
Appeals actions
submit claims Assistance
If Claims
needs to be
If Claim needs to be submitted
A submitted in paper
B
electronically

MEDICAL BILLING FLOW CHART
Front Medical Medical

Patient Provider
Office transcription Coding
Billing
office in
Billing
India
office in
U.S
Eligibility
Verification
Clearing
House
Patient
registration
Conversion in & Charge
Preliminary entry
to ins. Specific
screening Dispatch
format
Cash
Posting
A/R
Department
Insurance Company
Claim
Communication
Adjudicatio Pre-edit/Audit
of Decision
n

MEDICAL CODING
What is Medical Coding?
Every Healthcare Provider that delivers a Service receives money for these
services by filing a claim with patient’s Health Insurance Carrier. This is also
referred as an encounter. An encounter is defined as “a face to face contact
between a healthcare professional and an eligible beneficiary.”
Codes exist for all types of encounters, services, tests, treatments, and procedures
provided in a Medical office, clinic or hospital. Even patient complaints such as
headaches, upset Stomach, etc have codes which consist of a set of numbers and
a combination of set of numbers. The Combination of these codes tells the payer
what was wrong with patient and what service was performed. This makes it
easier to handle these claims and identify the provider on a predetermined basis.
Reason for the Visit /Encounter – Diagnosis Code

Service rendered - Procedure Code
Coding Systems
The two major coding systems are
1. International Classification of Diseases – Clinical Modification – 9th Revision
(ICD-9-CM)
2. Current Procedural Terminology (CPT)
CPT and ICD-9-CM are not the only coding systems. Here are few more coding
systems that are used to code a variety of coding information:
1. CDT-3 codes
2. ABC codes
3. SNOMED codes
4. NDC codes
5. Home Healthcare (saba) codes
6. DRG systems.

ICD coding system
ICD (International Classification of Disease) is a coding system for which the first
edition was published in 1900, and it is being revised at approximately 10-year
intervals. The most recent version is ICD-10, which was published in 1992. WHO is
responsible for its maintenance.
In US, the coding is still based on ICD-9-CM, which contains more detailed codes.
ICD consists of a core classification of three-digit codes, which
are the minimum requirement for reporting the reason for the
encounter. An optional fourth digit provides an additional level of
detail. At all levels, the numbers 0 to 7 are used for further detail,
whereas the number 8 is reserved for all other cases and the
number 9 is reserved for unspecified coding.
The basic ICD is meant to be used for coding diagnostic terms, but ICD-9 as well
as ICD-10 also contains a set of expansions for other families of medical terms.
For instance, ICD-9also contains a list of codes starting with the letter “V” for
reasons for encounter or other factors that are related to someone’s health status.
A list of codes starting with the letter “E” is used to code external causes of death.
The nomenclature of the morphology of neoplasms is coded by the “M” list.
The disease codes of both ICD-9 and ICD-10 are grouped into chapters. For
example, in ICD-9, infectious and parasitic diseases are coded with the three-digit
codes 001 to 139, and in ICD-10 the codes are renumbered and extended as
codes starting with the letters A or B; for tuberculosis the three-digit codes 010 to
018 are used in ICD-9, and the codes A16 to A19 are used in ICD-10. The four-

digit levels and optional five-digit levels enable the encoder to provide more detail.
Table below gives examples of some codes in the ICD-9 system.
Example of a Four-Digit Code Level in ICD-9 and the Five-Digit Code Level as
Extended by the ICD-9-CM
Code Disease
001 - 139 Infectious and parasitic diseases
001 - 009 Infectious diseases of the digestive tract
003 Other Salmonella Infections
- 003.0 Salmonella gastroenteritis
- 003.1 Salmonella Septicemia
- 003.2 Localized Salmonella Infections
- 003.20 Localized Salmonella Infection,
Unspecified
- 003.21 Salmonella Meningitis
- 003.22 Salmonella Pneumonia
- 003.23 Salmonella Arthritis
- 003.24 Salmonella Osteomyelitis
003.29 Other Localized Salmonella
-
Infections
- 003.8 Other Specified Salmonella
Infections
- 003.9 Salmonella Infections, Unspecified
The U.S. National Center for Health Statistics published a set of clinical modifications to ICD-
9, known as ICD-9-CM. It is fully compatible with ICD-9, but it contains an extra level of
detail where needed. In addition, ICD-9-CM contains a volume III on medical procedures.
CPT Coding System
Current Procedural Terminology (CPT), Fourth Edition, is a listing of
descriptive terms and identifying codes for reporting medical services and
procedures. The purpose of CPT is to provide a uniform language that accurately
describes medical, surgical, and diagnostic services, and thereby serves as an

effective means for reliable nationwide communication among physicians, patients,
and third parties.
The American Medical Association (AMA) first developed and published CPT in
1966. The first edition helped encourage the use of standard terms and
descriptors to document procedures in the medical record; helped communicate
accurate information on procedures and services to agencies concerned with
insurance claims; provided the basis for a computer-oriented system to evaluate
operative procedures; and contributed basic information for actuarial and
statistical purposes.
The first edition of the CPT code book contained primarily surgical procedures,
with limited sections on medicine, radiology, and laboratory procedures.
The second edition was published in 1970, and presented an expanded work of
terms and codes to designate diagnostic and therapeutic procedures in surgery,
medicine, and the specialties. At that time, five-digit coding was introduced,

replacing the former four-digit classification. Another significant change was a
listing of procedures relating to internal medicine.
In the mid- to late 1970s, the third and fourth editions of the CPT code were
introduced. The fourth edition, published in 1977, represented significant updates
in medical technology, and a procedure of periodic updating was introduced to
keep pace with the rapidly changing medical environment. In 1983, the CPT code
was adopted as part of the HealthCare Common Procedure Coding System
(HCPCS) (Formerly called as HealthCare Financing Administration's (HCFA)
Common Procedure Coding System). With this adoption, CMS mandated the use of
HCPCS to report services for Part B of the Medicare Program. In October 1986,
CMS also required State Medicaid agencies to use HCPCS in the Medicaid
Management Information System. In July 1987, as part of the Omnibus Budget
Reconciliation Act, CMS mandated the use of CPT for reporting outpatient hospital
surgical procedures. Today, in addition to use in federal programs (Medicare and
Medicaid), CPT is used extensively throughout the United States as the preferred
work of coding and describing health care services
Tools of the Trade
1. CPT Book – Procedural Coding
Medical services provided by physicians are identified using
the AMA Current Procedure Terminology or CPT codes. The
AMA CPT book provides descriptors for each of the 8,000
codes listed. Frequently there are additional instructions for code use in

each section of the book. These CPT rules should be followed when choosing
the correct code to describe the service provided
2. ICD-9-CM - Medical Diagnosis Coding
The ICD-9-CM coding system contains three "volumes" of
coding information although the volumes come in one
book. Volume 1 contains the diagnosis codes that every
provider needs for billing. Volume 2 is an alphabetical
index of Volume 1. Outpatient diagnostic or treatment centers, like
physician offices, need only Volumes 1 and 2. Thus, books that contain only
Volumes 1 and 2 are often referred to as physician, office, or outpatient
editions.
Volume 3 contains procedure codes, not diagnosis codes. Volume 3 codes
are used for billing inpatient hospital stays in the DRG system so books that
contain Volume 3 are called hospital, payer, or inpatient editions
3. HCPCS – CPT Level II codes
HCPCS Level II codes are used to bill Medicare for
supplies, materials, injections, DME, rehab, and
other services.
4. NCCI Manual

National Correct Coding Initiative guide will help us code
our service for reimbursement in compliance with CMS’s
policies to prevent claim rejection, delays, and audits.
Coding department functions
1. Charge sheets that must be coded are, upon receipt by the billing account,
forwarded to the coding department for diagnosis and CPT coding.
2. Medical coders code the diagnosis description given in the charge sheets
according to established guidelines, using the ICD-9-CM (International
Classification of Diseases, Revision 9, Clinical Modification, and Volumes 1 & 2)
diagnosis coding system and CPT/HCPCS codes according to the procedure
performed.. The published diagnosis/CPT coding rules under the ICD-9-CM/CPT
coding system are observed.
3. Codes are selected strictly based on documentation provided by the client,
and to the highest specificity as indicated in the submitted documents.
When documentation is insufficient or unclear, the charges are returned to
the client for clarifications.
4. Coding policies and guidelines, if any, established by the client, the coding
supervisor, or insurer are followed wherever applicable during the process of

coding.
5. When coders identify procedure coding or other errors in the charge
information given to them, such errors are corrected with an explanatory
note written on the concerned charge sheet. If the coding department
decides that the errors are of such a type that will require client
authorization or clarification, then such authorization or clarification is
obtained from the client by the concerned billing account.
6. When a coder finds that the information on the charge sheet is insufficient
to select the appropriate diagnosis or procedure code, the coder writes a
note in the charge sheet stating what additional information is needed to
supply the code.
7. When a given diagnosis code is not in the list of covered diagnosis codes
listed in the state Medicare carrier’s LMRP (Local Medical Review Policy), the
coder will code the diagnosis as documented and write “Not in LMRP” in the
charge sheet. A policy can be arrived on handling denials by the operation
team and client can be alerted on the same.
8. Coders, where ever possible, advise billing departments on the
appropriateness of the diagnosis codes and procedure codes documented in
a charge sheet, toward ensuring accurate health care claim submission.

9. Coders should not alter codes or change information documented in the
charge sheet, or any other medical document, unless authorized by the
client, except when there are definite errors, such as typographical errors.
No attempt will be made to alter the procedure or diagnosis documented by
the physician or medical service provider. (See also point 6 above)
10. Upon completion of coding, the coded charge sheets are forwarded to
the charge entry department of the respective billing account.
11. The work of new coders who join the department will be fully audited
before file submission, until such time the coders gain the required level of
accuracy.
12. A hundred percent audit of all coding work can be conducted during project
transition, until such time the coders gain the required experience and
accuracy levels.
13. Account specific coding policies, if applicable, will be documented
Coding guidelines
1. Follow all coding principles outline in the “Essentials of Accurate Coding,”

 Use all codes necessary to completely code all diseases and procedures,
including underlying diseases.
 Refer all medical records of patients treated for multiple trauma and
patients hospitalized over thirty days to the coding supervisor to verify
selection of principal diagnosis before abstracting.
 E codes are used whenever appropriate to identify external codes.
2. Consult the following sources to identify all diagnoses and procedures requiring
coding and to increase the accuracy and specificity of coding.
 Face Sheet-code diagnoses and complications appearing on the face
sheet.
 Progress Notes-Scan to detect complications and/or secondary diagnoses
for which the patient was treated and/or procedures performed.
 History and Physical-scan to identify any additional conditions; such as
history of cancer or a pacemaker in situ. These conditions should be
coded.
 Discharge Summary-read if available and compare listed diagnoses with
face sheet. Code diagnoses and procedures listed on discharge
summary but not specified on face sheet..
 Operative Reports-scan to identify additional procedures requiring
coding.
 Consult previous medical records in patients admitted for follow-up of
neoplasm to determine the primary and secondary sites.

 X-ray and laboratory-use reports as guides to identify diagnoses (e.g.
types of infections) or more detail (e.g. type of fractures).
 Physician’s Orders-scan to detect treatment for unlisted diagnoses-the
administration of insulin, antibiotics, and sulfonamides may indicate
treatment of diabetes, respiratory or urinary infections which should be
confirmed by checking other medical record forms.
3. Code incomplete face sheets by reviewing the above items.
 Record codes assigned in pencil on the fact sheet.
 Request supervisor’s assistance if difficulty is encountered in identifying
codable data by scanning record.
 Call physician for diagnostic information only if instructed to do so by
supervisor.
4. Exercise discretion in coding diagnostic conditions not identified on the face
sheet or discharge summary.
 Query physician on the deficiency report if the coding question influences
Identification of most specific code..
 Review all alcohol/drug abuse cases to confirm prior to coding.
5. Process special diagnostic coding situations as follows:
 V codes are used to identify encounters for reasons other than illness or
injury. V codes are used as principal diagnoses for newborn admissions

(V30.0-V37.0), Chemotherapy session (V58.0), Radiotherapy session
(V58.1), Removal of fixation devices (V54.0), and Attention to Artificial
openings (V55). For inpatient coding, avoid the use of V codes as the
principal diagnosis where a diagnosis of a condition can be made.
 V codes are used in outpatient coding when a person who is not
currently ill obtains health services for a specific purpose, such as, to act
as a donor, or when a circumstance influences the person’s health status
but is not in itself a current illness or injury. Patients receiving
preoperative evaluations receive a code from category V72.8.
 Avoid using codes that lack specificity. These vague codes should not be
used if it is possible to obtain the information required to assign a more
specific code.
 Inpatient coding requires that signs and symptoms are coded when a
specific diagnosis cannot be made or when the etiology of a sign or
symptom is unknown. Do not code symptoms if the etiology is known
and the symptom is usually present with a specific disease process.
Example: Do not code convulsions with the diagnosis of epilepsy.
 Outpatient coding requires that diagnoses documented as “probable,
suspected, questionable, rule out or working”, should not be coded.
Code the condition for that visit, i.e., signs or symptoms or abnormal
test results.
 Chronic conditions may be coded as many times as the patient receives
treatment.

 Code abnormal laboratory tests only when noted on the face sheet by
the attending physician.
 When there are more diagnoses for a hospitalization, acute conditions
take precedence over chronic and at least one comorbid condition or
complication should be included in the diagnoses which may be
submitted to Medicare. All complications and comorbitities should be
reported for calculating severity of illness.
6. Sequence diagnoses and procedures according to the “Guidelines for
Sequencing and Designating Principal Diagnosis and Principal Procedure
Codes.”
Essentials of accurate coding
1. Identify all main terms or procedures included in the diagnostic/procedural
statements(s).
2. Locate each main term/procedure in the Alphabetical Index. A main term
may be followed by a series of terms in parentheses. The presence or
absence of these parenthetical terms in the diagnosis has no effect upon the
selection of the code listed for the main term.
3. Refer to any sub terms indented under the main term. These sub terms for
individual line entries and describe essential differences by site, etiology or
clinical type.

4. Follow cross reference instructions if the needed code is not located under
the first main entry consulted.
5. Verify code selected from the Index in the Tabular List.
6. Read and be guided by any instructional terms in the Tabular List.
7. Fourth and fifth digit sub classification codes must be used where provided.
8. Continue coding diagnostic and procedural statements until all of the
component elements are fully identified. This instruction applies even when
no “use” statement appears.
9. Use both codes when a specific condition is stated as both acute (or sub
acute) and chronic and the Alphabetic Index provides unique codes at the
third, fourth, or fifth digit level.
10. The term hypertensive means “due to”, but the presence of words
such as “and or with hypertension” does not imply causality.
11. If the cause of a sign or symptom is specified in the diagnosis, code
the cause but do not assign a code for the sign or symptom.
12. For inpatient coding, when a diagnosis statement consists of a
symptom followed by comparative or contrasting diagnoses, assign codes
for the symptom as well as for the diagnoses. When coding outpatient
services, do not code diagnoses documented as “probable, suspected,
questionable, rule out or working diagnosis”. Code the condition
necessitating that visit, such as signs or symptoms, abnormal test, or other
reasons.

13. Do not confuse V codes which provide for classifying the reason for
visit with procedure codes documenting the performance of a procedure.
14. V codes are found in the Alphabetic Index under references such as
Admission, Examination, History of, Problem, Observation, Status,
Screening, Aftercare, etc.
15. When an endoscopic approach is utilized to accomplish another
procedure (such as biopsy, excision of lesion or removal of foreign body),
assign codes for both the endoscopy and the procedure unless the code
books contain instructions to the contrary or the code identifies the
endoscopic/laparoscopic approach.
16. No procedure code is assigned if an incision was not made. Code
canceled surgeries to V64.1, V64.2 and V64.3. use code V64.1 if a closed
fracture reduction was attempted but not accomplished.
17. Consult the Alphabetical Index first to code neoplasm in order to
determine whether a specific histological type of neoplasm has been
assigned a specific code.
18. Do not assign the code for primary malignancy or unspecified site if
the primary site of the malignancy is no longer present. Instead, identify
the previous primary site by assigning the appropriate code in category V10
“Personal history of malignant neoplasm.”
19. Cancer “metastatic from” a site should be interpreted as primary of
that site and cancer described as “metastatic to” a site should be
interpreted as secondary of that site.

20. If no site is stated in the diagnosis but he morphologic type is
identified as metastatic, code as primary site unknown and also assign the
code for secondary neoplasm or unspecified site.
21. Code fractures as closed unless they are specified as open.
22. Code only the most severe degree of burn when different degrees of
burns occur at the same site.
23. Assign separate codes for multiple injuries unless the coding books
contain instructions to the contrary or sufficient information is not available
to assign separate codes.
24. Poisoning by drugs includes drugs given in error, suicide and
homicide, adverse effects of medicines taken in combination with alcohol, or
taking a prescribed drug in combination with self prescribed drugs.
25. Adverse reactions to correct substances properly administered
include: allergic reaction, hypersensitivity, intoxication, etc. The poisoning
codes 960-979 are never used to identify adverse reactions to correct
substances properly administered.
26. Complications of medical and surgical care are located in the
Alphabetical; Index under Complication or the name of the condition.
27. The causes or residual illnesses or injuries are located in the
Alphabetical Index under Late Effect.
28. When the late effect of an illness or injury is coded in the main
classification, the E code assignment must also be one for late effect.

MEDICAL BILLING – PATIENT DEMOGRAPHICS
Patient demographics – an overview
• What is Patient Demographics and what does it contain?
Patient Demographics sheet contains all the basic demographic information about
an individual or patient. Patient demographics ( PD ) include Patient name, Date
of birth, Address, Phone number, Doctor information, Social security number
(SSN) and Sex. Patient Demographic also contains Guarantors or emergency
contact information, Health insurance information. Each piece of information is
important because correct and quality entry of such information will directly
impact physician’s monthly revenue. This sheet is also called as face sheet of a
charge or claim.
A good patient demographic form is the key to obtaining accurate information
which is required for claim submission. Providing as much information as possible
will reduce the insurance company’s need to contact billing office. Avoiding
unnecessary contact will reduce the costs of claims processing and delay in
payments. Obtaining all the required demographic information will often determine
how willing the patient is to complete the form. If the request is firm and
professional without being offensive, we have great chances of getting the
information’s which we need to settle a claim.

Ideally a patient’s insurance coverage should be verified before any service is
rendered with the common exception of emergency treatment. This policy
shouldn’t apply exclusively to new patients. Established patients may have
changed employers, gotten married or divorced or are no longer covered by the
policy which was in effect during their last visit. Photocopy of insurance cards is
always a help.
• How Patient demographics originate and reach us?
Patient Demographic sheets also known as face sheet are distributed to patients
when they visit physician’s office for treatment. Before the services are rendered,
front office staff ensures that patient demographic sheets are filled in by the
patient or some one in patient’s family. This process ensures that all necessary
patient’s demographic information are gathered accurately which would facilitate
in timely reimbursement of physicians charges. In most of the physician’s front
office, copies of insurance identification card are also taken. This is to ensure that
all the information’s available in insurance identification card are captured.
Insurance ID card contains very valuable information which would be very helpful
in settling the claim.
These patient demographics are batched together at physician’s office and are
forwarded to our office for patient demographics entry.

• For our easy understanding now let us see each of the information found in
patient demographics. Information found in patient demographics have been
classified into five major headings.
They are:
I. Patient Information.
II. Patient Employer Information.
III. Patient Guarantor Information.
IV. Physician Information.
V. Insurance Information.
I. Patient Information
This segment in face sheet consists of basic demographic information.
They are:
1. Account #
2. Patient Name
3. Patient Sex
4. Patient Date of Birth
5. Marital Status
6. Patient Address
7. Patient phone number

Each patient record is assigned a patient account number. This is how a patient is
identified in the system. Before filing any claim we would need to obtain clear,
accurate information from the patients. A good patient information sheet is the
key to this aspect of claims submission. Let us now see few more things about
items listed below.
1. Account Number [Visit Number]: In case of a New Patient this field in almost
all the Medical Billing software’s is updated automatically. In cases where it does
not get updated automatically the billing office enters the Medical Record
Number/Account Number as on the Encounter Form submitted by the
Hospital/Provider.
In case of an Established Patient the Billing Office runs a query to search for
the patient record with the help of the Medical Record Number/Account Number or
using the Last Name or using the Date of Birth of the patient. If the software has a
Visit Number concept then a new visit with the same Account number and the next
visit number is created if not then the same Account is edited with the new details
as on the Encounter Form.
This number is for the internal purpose of the Billing Office and the Hospitals.
This field is usually in numeric format but may differ from software to software.
This number does not form part of the CMS-1500 claim form.
Example:
Account #: 24584951, 3205215 …
Account # and Visit #: 24584951-01, 24584951-02 …

2. Patient Name: This field is entered in the Last Name, First Name Middle Initial
format. However in some software’s this field is split as Last Name First Name and
Middle Initial fields. The patient name may also contain title (Junior, Senior, I, II,
III …) and suffix (M.D. …) this information also needs to be entered along with the
name. The title must be entered with the last name and the suffix should be
entered with the first name or after the middle initial. The Name on the Encounter
Form may not be given in above said format but still it should be entered as per
the Billing Software specifications. Checking the spelling of patient name is a very
important step. Simple errors such as transposition of letters or misspelled names
can result in denial or suspension of the claim.
Patient name is printed in the 2nd field of the CMS1500 form in Last Name,
First Name Middle Initial format.
Example:
Patient Name: Jones, Brenda K; Brenda K Jones; Miller John Jr.; …
3. Date of Birth: This field contains the Date of Birth of the patient. It is entered
in the MM/DD/YYYY or MMDDYYYY as per the Billing Software specification.
This field is printed in the 3rd field of the CMS-1500 claim form in MM DD YY
format. If Date of Birth detail is not available then generic DOB format have to be
entered i.e., 01/01/1901.
Example:
Date of Birth: 02/12/1979; 02/12/79; 02-Dec-1979 …

4. Sex: This field contains the Gender of the patients. i.e., M for Male, F for
Female, and U for Unknown when the gender of the patient is not specified on the
patient encounter Form.
This field is printed in the 3rd field of the CMS-1500 claim form along with the
Date of the Birth.
Example:
Sex: Male; Female; M; F.
5. Social Security Number: This field contains a 9 digit number which is allotted
to the patient by the Social Security Administration. If SSN is missing from patient
encounter form then this field is usually left blank or any 9 digit dummy number
(000-00-0000/999-99-9999) is entered as per the Billing Software specifications.
Example:
SSN: 245-19-0124; 245190124
i. When did Social Security start?
The Social Security Act was signed by President Franklin Roosevelt on August 14,
1935. Taxes were collected for the first time in January 1937 and the first one-
time, lump-sum payments were made that same month. Regular ongoing monthly
benefits started in January 1940.

ii. What is the origin of the term ‘Social Security’?
The term was first used in the U.S. by Abraham Epstein in connection with his
group, the American Association for Social Security. Originally, the Social Security
Act of 1935 was named the Economic Security Act, but this title was changed
during Congressional consideration of the bill. Under the 1935 law, Social Security
only paid retirement benefits to the primary worker. A 1939 change in the law
added survivor’s benefits and benefits for the retiree's spouse and children. In
1956 disability benefits were added.
iii. Who assigns the SSNs and how many SSNs have been assigned?
Social Security numbers are assigned by Social Security Administration. SSNs
were first issued in November 1936. By December 1, 2002 more than 418 million
numbers had been assigned.

iv. Is it true that Social Security was originally just a retirement
program?
Yes. Under the 1935 law, Social Security only paid retirement benefits to the
primary worker. A 1939 change in the law added survivor’s benefits and benefits
for the retiree's spouse and children. In 1956 disability benefits were added.
v. Is Social Security just a program for the elderly and disabled?
Social Security is not just a program for the elderly and disabled. Survivors of
deceased workers and the families of retired or disabled workers also qualify for
benefits. In fact, about 3.8 million children are currently receiving such benefits
and 9 out of 10 would be eligible to receive benefits if a parent retires, becomes
disabled, or dies. They need a Social Security number (SSN) before they can
receive benefits.
The SSN is also needed for reasons not connected with Social Security benefits.
For example, to be claimed as a dependent on a tax return, to open a bank
account and buy Savings Bonds, your child needs an SSN.
vi. Is there any significance to the numbers assigned in the Social
Security Number?
The digits in the Social Security number allow for the orderly assignment of
numbers. The number is divided into three parts: the area, group, and serial

numbers. The first three (3) digits (area) of a person's social security number are
determined by the ZIP Code of the mailing address shown on the application for a
social security number. Generally, numbers were assigned beginning in the
northeast and moving westward. So people on the east coast have the lowest
numbers and those on the west coast have the highest numbers. The remaining
six digits in the number are more or less randomly assigned and were organized to
facilitate the early manual bookkeeping operations associated with the creation of
Social Security in the 1930s.
Within each area, the group number (middle two (2) digits) range from 01 to 99
but are not assigned in consecutive order. For administrative reasons, group
numbers issued first consist of the Odd numbers from 01 through 09 and then
Even numbers from 10 through 98, within each area number allocated to a State.
After all numbers in group 98 of a particular area have been issued, the Even
Groups 02 through 08 are used, followed by Odd Groups 11 through 99.
Within each group, the serial numbers (last four (4) digits) run consecutively from
0001 through 9999.
vii. Are Social Security Numbers re-assigned after a person dies?
SSA does not reissue SSNs after someone dies. When someone dies their number
is simply removed from the active files and is not reused. In theory, the time
might come someday when SSA would need to consider "recycling" numbers in

this way--but not for a long time to come. SSA does not have to face reissuing
numbers since the 9-digit Social Security number allows about 1 billion possible
combinations, and to date SSA have issued a little over 400 million numbers.
viii. How can one get a different Social Security number assigned to
himself?
Generally, an individual is assigned only one Social Security number (SSN) which
is used to record the individual’s earnings for future benefit purposes and to keep
track of benefits paid under that number. However, under certain circumstances,
SSA may assign an individual a new (different) SSN. When they assign a new
number, the original number is not voided or deleted. For integrity reasons, they
cross-refer in the records all the numbers assigned to the same individual.
SSA can assign new SSN in the following situations, provided all of the
documentation requirements are met:
• Sequential SSN are assigned to members of the same family
• Certain scrambled earnings situations
• Certain wrong number cases
• Religious or cultural objection to certain numbers/digits in the SSN
• Misuse by a third party of the number holder’s SSN and the number holder
has been disadvantaged by that particular misuse

• Harassment, abuse or life endangerment situations (including domestic
violence)
To apply for a new (different) SSN, you need to complete Form SS-5 (Application
for a Social Security Card)
You will also need to submit evidence age, identity, and U.S. citizenship or lawful
alien status. Form SS-5 explains what documents will satisfy these requirements.
You will also need to submit evidence to support your need for a new number.
If you are age 18 or over, you must submit your request for a new SSN in person
at your local Social Security office.
ix. When did Social Security cards bear the legend "NOT FOR
IDENTIFICATION"?
The first Social Security cards were issued starting in 1936; they did not have this
legend. Beginning with the sixth design version of the card, issued starting in
1946, SSA added a legend to the bottom of the card reading “FOR SOCIAL
SECURITY PURPOSES -- NOT FOR IDENTIFICATION”. This legend was
removed as part of the design changes for the 18th version of the card, issued
beginning in 1972. The legend has not been on any new cards issued since 1972.

x. How to get a Social Security number for my baby?
The easiest way to apply for a baby's Social Security number (SSN) is at the
hospital. Both parents’ Social Security numbers are required when applying for a
baby’s SSN. When a parent requests a Social Security number (SSN) for his/her
newborn as part of the birth registration process in the hospital, the State Vital
Statistics Office forwards to the Social Security Administration (SSA) data we need
to assign an SSN to the child and issue a card. This is known as the Enumeration
at Birth (EAB) process. Once SSA receives the data, the process of assigning the
number and issuing the card is the same as if the application were taken in a
Social Security office.
In most States, the birth registration process is electronic. Hospitals submit birth
registration information through local registrars to the State, where the
information is entered into an automated database. In most States this process is
completed and EAB data is sent to the Social Security Administration within 60
days of birth. EAB is a good service for most parents who have no immediate need
for their child's SSN because they do not have to submit an application and
evidentiary documents to a Social Security office.
xi. What types of Social Security cards does SSA issue?
SSA issues three types of Social Security cards depending on an individual's citizen
or non-citizen status and whether or not a non-citizen is authorized by the
Department of Homeland Security (DHS) to work in the United States.

 The first type of card shows the individual's name and Social Security number
only. This is the card most people have and reflects the fact that the holder can
work in the U.S. without restriction. SSA issues this card to:
- U.S. citizens, or
- Non-citizens who are lawfully admitted to the U.S. for permanent residence,
or who have permission from the Department of Homeland Security (DHS)
record to work permanently in the U.S., such as refugees, asylees and citizens
of Compact of Free Association countries.
 The second type of card bears, in addition to the individual's name and Social
Security number, the legend, "NOT VALID FOR EMPLOYMENT". SSA issues this
card to non-citizens who:
- don't have DHS permission to work, but are receiving a federally-funded
benefit; or
- are legally in the U.S. and don't have DHS permission to work but, are
subject to a state or local law which requires him or her to provide a SSN to
get general assistance benefits or a State driver's license for which all other
requirements have been met.
 The third type of card bears, in addition to the individual's name and Social
Security number, the legend, "VALID FOR WORK ONLY WITH INS (or
DHS) AUTHORIZATION". SSA issues this card to people who have DHS
permission to work temporarily in the U.S.
If you’re a non-citizen, SSA must verify your documents with DHS before SSA
issues a SSN card. SSA will issue the card within two days of receiving

verification from DHS. Most of the time, they can quickly verify your documents
online with DHS. If DHS can’t verify your documents online, it may take several
weeks or up to three months to respond to Social Security's request.
xii. Which Social Security numbers are invalid (impossible)?
An invalid (or impossible) Social Security number (SSN) is one which has not yet
been assigned.
The SSN is divided as follows: the area number (first three digits), group number
(fourth and fifth digits), and serial number (last four digits). To determine if an
SSN is invalid consider the following:
• No SSN with an area number in the 800 or 900 series, or "000" area number,
have been assigned.
• No SSN with an area number above 728 have been assigned in the 700 series,
except for 729 through 733 and 764 through 772.
• No SSN with a "00" group number or "0000" serial number have been
assigned.
• No SSN with an area number of "666" have been or will be assigned.
xiii. Is it legal to laminate your Social Security card?
SSA discourages the lamination of Social Security number (SSN) cards because
lamination would prevent detection of certain security features. To deter potential
fraud and misuse involving SSN, SSA currently issues SSN cards that are both
counterfeit-resistant and tamper-resistant. (For example, the card contains a

marbleized light blue security tint on the front, with the words "Social Security" in
white; intaglio printing in some areas on the front of the card; and yellow, pink,
and blue planchets--small discs--on both sides). SSA cannot guarantee the validity
of a laminated card. You may, however, cover the card with plastic or other
material if the material could be removed without damaging the card.
SSA would also recommend that as a security precaution, you carry your Social
Security card only when you expect to need it, for example, to show to an
employer or other third party.
xiv. Is there any charge for replacing a Social Security card?
Social Security does not charge a fee for either an original or replacement Social
Security card. A replacement card can be a duplicate card (one with the same
name and number) or a corrected card (one with different name but the same
number).
xv. Can metal or plastic versions of Social Security cards be used?
The official verification of your Social Security number is the card issued by the
Social Security Administration. Third parties who request your Social Security card
as verification of your number will want to see the card SSA issues. Although
Social Security has no authority to prevent use of metal or plastic replicas of Social
Security cards, SSA considers them an unauthorized use of the Social Security
number and discourages their use.

xvi. Can Social Security number be canceled?
No. When someone has applied for and been assigned a Social Security number
(SSN) based on a validly signed application, the Social Security Administration
(SSA) may not cancel or destroy that record. The Privacy Act of 1974 authorizes
agencies to maintain in their records any information about an individual that is
relevant and necessary to accomplish a purpose of the agency that is required by
law. SSA is required by law to establish and maintain records of wages and self-
employment income for each individual whose work is covered under the program.
The SSN is considered relevant and necessary for that record keeping purpose.
Consequently, valid SSN are permanently part of SSA's records.
6. Marital Status: This field contains the Marital Status of the patient. It is
usually entered as ‘S’ for Single, ‘M’ for Married, ‘D’ for Divorced, ‘W’ for
Widow/Widower, ‘X’ for Separated and ‘O’ for Others. It marital status is missing
from patient encounter form, we need to enter ‘O’ in the marital status field.
This field is printed in the 8th field of the CMS-1500 claim form.
Example:
Marital Status: Single; Married; Divorced; Widow …
7. Address: Patient’s address is split into 5 different fields. It is usually entered
as Address1 (PO Box#/Door#/Appt. #), Address2 (Street/Ave. /Blvd. Name), City,
State and ZIP code. This field can not be left blank. Patient address is a

important field to file a claim & send patient statement. Following are the general
abbreviations found in patient encounter forms:
a) Apt. # - Apartment number
b) Ave. - Avenue number
c) Blvd. - Boulevard
d) Ste. - Suite/Street
e) Dr. - Drive
This field is printed in the 5th field of the CMS-1500 claim form.
Example:
Address: 1067 Orange Grove Blvd.
Apt. # 194
Los Angeles, CA 90001
8. Patient Phone Number: This field contains the contact number of the patient
including the area code. It contains a total of 10 digits (111-222-3333), the first 3
digits are the area code, and the next 7 digits are the phone number of the
patient. If the area code is not specified the phone number can still be entered
leaving the area code field blank or entering some dummy number as per the
Billing Software specifications.
This field is printed in the 5th field of the CMS-1500 claim form along with the
address.
Example:
Phone Number: 626-843-2846; (626)357-5496 …

II.Patient Employer information
This segment in the face sheet contains employer information of the patient. The
entry person needs to enter this information if available in face sheet. Employer
information is a must for worker’s comp claims. Non-worker’s comp claims do not
require employer name to process claims but it is advisable to update employer
information during entry. Following information’s are found in this segment
1. Employer Code
2. Employer Name
3. Employer Address & Phone #
4. Designation/Occupation
5. Contact Person
1. Employer Code: This field is used in most of the Billing Software’s to reduce
the time of PD entry. The Names and Addresses of the major Employers are stored
in the Employer database with a unique code assigned to each employer. Hence it
is enough to just enter the code and skip to the next block.
Example:
Employer Code: IBM; A0012; MS024 …

2. Employer Name: This field contains the name of the patients Employer. If the
patient is a Student or Not Employed or Retired then it can be entered as Student
or Not employed or Retired in this field.
This field is printed in the 11b field of the CMS-1500 claim form.
Example:
Employer: Verizon Wireless; Microsoft Corp.; SUN Microsystems …
3. Employer Address: The address of the patients Employer is split into 5
different fields. It is usually entered as Address1 (PO Box#/Door#/Apt.#),
Address2 (Street/Ave. /Blvd. Name), City, State and ZIP code.
Example:
Address: PO Box 1954
Los Angeles, CA 90001-1954
4. Employer Phone Number (Ext No.): This field contains the contact number
of the patients Employer including the area code. It contains a total of 10 digits
(111-222-3333), the first 3 digits are the area code and the next 7 digits are the
phone number of the patient. If the area code is not specified the phone number
can still be entered leaving the area code field blank or entering some dummy
number as per the Billing Software specifications. Some software’s may also
require you to enter the Extension number if given on the encounter form.
Example:
818-245-7849 [5478]; (818)-245-7849 …

III. Patient Guarantor Information
This segment in face sheet consists of guarantor or emergency contact
information.
They are:
1. Guarantor Account #
2. Guarantor Name
3. Guarantor Address
4. Guarantor phone #
5. Guarantor/patient relationship
6. Guarantor employer & SSN
This block is mostly entered only in the case of the patient being a minor or if
the patient is not responsible for the payment. This information is for the internal
purpose of the Billing Office and the Hospitals for the purpose of Emergency
Contact or follow-up of pending balances and hence does not form part of the
CMS-1500 claim form.
1. Guarantor Account #: This field is used to enter the guarantor account #. If
the guarantor is already stored in the database then the stored information can be
pulled up using this number. This information is not part of the encounter form.
The account number of the guarantor is pulled using search engine.

Example:
245818A; 6252315; 421154; …
2. Guarantor Name: This field is entered in the Last Name, First Name Middle
Initial format. However in some software’s this field is split as Last Name First
Name and Middle Initial fields. The guarantor name may also contain title (Junior,
Senior, I, II, III …) and suffix (M.D. …) this information also needs to be entered
along with the name. The title must be entered with the last name and the suffix
should be entered with the first name or after the middle initial. The Name on the
Encounter Form may not be given in above said format but still it should be
entered as per the Billing Software specifications.
Example:
Joseph Warowes Sr.; Warowes, Virginia E M.D …
3. Relationship: This field contains the relationship of the Guarantor with the
patient, such as Spouse, Parent, Others etc.
Example:
Relationship: Spouse; Parent; Grand Parent …
4. Address: The address of the Guarantor is split into 5 different fields. It is
usually entered as Address1 (PO Box#/Door#/Apt.#), Address2 (Street/Ave.
/Blvd. Name), City, State and ZIP code.
Example:
102 West 35th Street
Heathsville, GA 65418

5. Phone Number: This field contains the contact number of the Guarantor
including the area code. It contains a total of 10 digits (111-222-3333), the first 3
digits are the area code and the next 7 digits are the phone number of the patient.
If the area code is not specified the phone number can still be entered leaving the
area code field blank or entering some dummy number as per the Billing Software
specifications.
Example:
(517)373-1820; 517-374-5857 …
6. Guarantor Employer: This field contains the guarantor’s employer
information. Basically the guarantor’s employer name, address, and contact details
are entered here.
7. Emergency Contact: This field is used to enter the Emergency Contact details
of the patients relative or next of kin. Contact information such as Name, Address
Phone # and relation to the patient are entered here.
IV. Physician Information

This segment contains the following information.
1. Admitting physician code: The physician responsible for admission of a
patient to a hospital or other inpatient health facility. Some facilities have all
admitting decisions made by a single physician (typically a rotating responsibility),
called an admitting physician. All the information’s related to a particular physician
(Physician Name, UPIN, Federal Tax ID, License #, Facility Address & Phone #) are
stored using a unique code in the provider database. Hence while selecting a
physician codes the entry person should be very careful to select the correct code
after cross checking all the relevant details. This field is optional; if the Admitting
physician info is not given it can be left blank.
This field does not form part of the CMS-1500 claim form.
Example:
Adm. Phy.: Mileski MD, William
2. Attending or Rendering physician code: The physician rendering the major
portion of care or having primary responsibility for the care of the patient's major
condition or diagnosis. In other words the doctor or supplier who actually renders
the service (also referred to as a "rendering physician"). All the information’s
related to a particular physician (Physician Name, UPIN, Federal Tax ID, License
#, Facility Address & Phone #) are stored using a unique code in the provider
database. Hence while selecting a physician codes the entry person should be very
careful to select the correct code after cross checking all the relevant details.
The Name of the rendering physician is printed in the 33rd field along with the
Address and Phone #. The rendering physician’s Federal tax ID stored in the
database is automatically printed in the 25th field of the CMS-1500 claim form.

Example:
Att. Phy.: Pendridge MD, Dayton
3. Referring Physician/Primary Care physician code: The physician who has
sent the beneficiary to another physician or, in some cases to a supplier (e.g.,
physical therapist, occupational therapist) for consultation and/or treatment is
called a referring Physician or Primary Care Physician (PCP). The name of the
facility may be reflected in this area if the patient has not identified a unique
physician, but has identified a facility. All the information’s related to a particular
physician (Physician Name, UPIN, Federal Tax ID, License #, Facility Address &
Phone #) are stored using a unique code in the provider database. Hence while
selecting a physician codes the entry person should be very careful to select the
correct code after cross checking all the relevant details.
The name of the referring physician is printed in the 17th field and the
corresponding UPIN stored in the database is printed in the 17a field of the CMS-
1500 claim form.
V.Insurance Information

This segment of face sheet contains all active insurance information of the
patient. This segment includes primary, secondary, and/or tertiary insurance
information. This segment is the most important field in patient demographic
sheet. Information found in this field should always be the updated & correct one.
If not, we would be submitting claims to incorrect insurance. Entry persons should
always match this information with copy of insurance id cards. (if provided). This
will reduce the risk of entering incorrect insurance information. Following
information are found in this segment
1. Insurance Code/Name
2. Effective Date
3. Subscribers Name
4. Relationship Code
5. Pre-Certification/Pre-Authorization
6. Referral Number
7. Primary Insurance Group & Policy #
8. Date of Injury/Accident
9. Claim Number
Sample Medicare Insurance Card copy:
1. Insu
rance

Code/Name: This field is used to enter the insurance code or name of the
coverage that the patient has. The insurance code is assigned by the Billing office
for its internal purpose to reduce the PD entry time. Each Insurance company’s
name, billing address, contact person, etc… are assigned a unique code. The entry
person should be very careful while selecting the insurance code and should
always verify the billing address with the given card copy or with the billing
address given on the encounter form.
The Primary insurance name is printed in the 11c field and the Secondary
insurance name is printed in the 9d field of the CMS-1500 claim form.
Example:
Insurance: Medicare, Medicaid, Blue Cross, Blue Shield …
2. Effective Date: This field contains the effective date of coverage. This date
should not be after the Date of Service. The date format is MMDDYYYY. This date
is used for the internal purpose of the Billing office and Hospitals. This does not
form part of the CMS-1500 claim form.
Example:
Eff. Date: 7-1-66; 07/01/1976; 07 01 66 …
3. Subscribers Name: This field contains the Subscribers name of the insurance
policy. If the patient is a dependant who is covered under someone else’s policy
then the name of the person who pays the premium is entered in this field. If
patient is the subscriber then we need to enter the patient name itself. The name
is entered in the Last Name, First Name MI format.

The Primary insurance subscribers name is printed in the 4 th field and the
Secondary insurance subscribers name is printed in the 9th field of the CMS-1500
claim form.
Example:
Subscriber: John Q. Public; Public, John Q …
4. Relationship Code: This field contains the relationship of the subscriber to the
patient. The code is usually 1 – Self, 2 – Spouse, 3 – Parent, 4 – others etc…This
field does not form part of the CMS-1500 claim form.
5. Policy ID: This field contains the Policy number given by the insurance
company to the subscriber and the dependants of the policy. This does not have
any standard format across the insurance company but each insurance company
has a unique format such as for Medicare the policy number is given as SSN +
Alpha or Alphanumeric. The policy ID should be entered as given in the scanned
card copy or as mentioned on the Encounter form. The Primary insurance ID is
printed in the 11th field and the Secondary insurance ID is printed in the 9a field of
the CMS-1500 claim form.
Example:
Policy ID: 123-54-5478A; 215543251W1; 215-47-6491 …
6. Group ID: This field contains the Group ID as given by the insurance company
for the policy. Not all the insurance companies have the Group ID hence if not
given then this field can be left blank.

The Group ID is printed along with the Policy ID on the CMS-1500 claim form.
7. Pre-Auth. / Pre-Cert. Number: Review of "need" for inpatient care or other
care before admission. This refers to a decision made by the payer, Managed Care
Organization, or insurance company prior to admission. Most managed care plans
require pre-cert. This is a method of controlling and monitoring utilization by
evaluating the need for service prior to the service being rendered. The practice of
reviewing claims for inpatient admission prior to the patient entering the hospital
in order to assure that the admission is medically necessary. The third party
usually reviews the treatment plan, monitoring one or more of the following:
patient's eligibility, covered service, amounts payable, application of appropriate
deductibles, co-payment factors, and maximums. Under some programs, for
instance, pre-determination by the third party is required when covered charges
are expected to exceed a certain amount. This number should be attached with
the respective claim; otherwise the claim will be rejected. There is no standard
format for Auth and Pre-Cert. number across all the insurance companies. Each
insurance company has its own unique format of Auth and Pre-Cert. numbers.
8. Referral Number: A Referral number is provided by a PCP (Primary Care
Physician) when he refers a patient to a specialist. Without the Referral number a
patient cannot get a specialist’s service if he has a HMO plan. This number is
printed on the CMS-1500 claim form or entered in the attached documents as per
the Insurance company requirements.

9. Date of Injury/Accident: This field is used to enter the Date of
Injury/Accident when the claim is filed to Work Comp/Auto Accident insurance.
This date is useful for the insurance companies to verify if the coverage was active
or not. This date is mentioned in the documents attached while filing the claim.
10. Claim Number: This field is used to enter the Claim number for a particular
claim given by the Work Comp/Auto Accident insurance company. Failing to
mention this number on the claim form will result in the rejection of the claim.

MEDICAL BILLING – PATIENT CHARGES
Patient charges – an overview
• What are Patient Charges and what does it contain?
Patient charge is nothing but the fees claimed by the physician who rendered the
services to the patient. Charges can be either based upon demographic evaluation
or a flat fee rate as prescribed by the physician’s office. Each piece of information
is important because correct and quality entry of such information will directly
impact physician’s monthly revenue. This sheet is also called as face sheet of a
charge or claim.
• How Charge Sheets originate and reach us?
Once patient /spouse completes Pd sheet, patient is then referred to physician in
the appointed time. After preliminary investigation physician provides the services
required by the patient. In the super-bill, kind of treatment is denoted by
procedure code and diagnosis code denotes the nature of illness for which services
were administered.
Super bills or charge sheets contain information like Date of Service, Kind of
Service, Diagnosis Code, Attending Doctor, Modifier details. Super bills are usually
completed by physician or their assistant. Sometimes Coding of diagnosis &
procedures are done by coding specialists.

Once Charge sheets are completed, they are batched with PD at physician’s office
and are forwarded to our office for charge entry. Mode of transfer of data may
vary from client to client. But most preferred mode is thru FTP. Here patient
demographics are scanned & captured as image file. These image files are placed
in FTP site. These image scan files are retrieved at our office & charge entry
begins.
Information found in patient charge sheet
• For our easy understanding now let us see each of the information found in
patient charge sheet 1. Attending Physician 2. Referring Physician 3. Admit
Date 4. Date of Service 5. Type of Service 6. Place of Service 7. Prior
Authorization Number 8. Modifiers 9. Procedure code 10. Diagnosis Code 11.
# Of days/ units, 12. Location Details 13. Physician Name, Address, Provider id
1. Attending Physician: Attending physician is also referred as rendering
physician. A physician who renders the service to patients is called
attending or rendering physician. Each Rendering/Attending Physician of a
particular facility is assigned a unique code with the Name of the
Physician, Address of the Clinic/Facility, PIN (Provider Identification
Number), License number, Federal TaxID#.
The Rendering Physician Name, Address, and PIN are printed in the 33rd
field and if the Address of the Facility where the service was rendered
differs from the Physicians location then that address is printed in the 32 nd

field and the corresponding Federal Tax ID of the Provider is printed in the
25th field of CMS-1500 form.
2. Referring Physician: Physician who refers patient to specialists is
called referring Physician or Primary Care Physician (PCP) information is
integral to continuity of care, reimbursement and community relations. In
simple words, the physician who has sent the beneficiary to another
physician or, in some cases to a supplier (e.g., physical therapist,
occupational therapist) for consultation and/or treatment is known as a
Referring Physician. Each Referring Physician is allotted a unique code in
the Medical Billing software which stores the Name of the Physician,
Address of the Clinic/Facility, UPIN (Unique Physician Identification
Number).
The Referring Physician Name is printed in the 17th field of the CMS-1500
claim form. The UPIN which is stored along with the code is printed in the
17a field of the CMS-1500 claim form.
3. Admit Date: Admit date refers to the date in which patient was admitted
into the Hospital. For workers compensation Date of Injury (DOI) is very
important for processing the claim. For the purpose of determining the
date of injury for an occupational disease, the date of injury shall be taken
to be the last date of injurious exposure to the hazards of such disease or
the date on which the employee first knew or reasonably should have

known of the condition and its relationship to the employee's employment,
whichever is the later.
4. Date of Service: DOS is the date in which services were rendered to
patient by attending physician. In certain cases we have thru date of
service and also it will be in the single date format. Standard format for
entering DOS is mm/dd/yyyy. DOS must be greater than or equal to
admit date.
5. Type of Service: We need to input the type of service which was
administered to patient. Broadly we have two digit TOS codes which
needs to be entered in block 24C of CMS-1500 form. The type of service
defines what type of service it is like radiology, cardiology and etc.
6. Place of Service: Two digit place of service needs to be entered in
block 24b of CMS-1500 form while submitting claims to insurance carriers.
POS can be for inpatient, Outpatient & ER. Health care that you get when
you are admitted to a hospital is an inpatient. Medical or surgical care that
does not include an overnight hospital stay is an outpatient. Care given for
a medical emergency when you believe that your health is in serious
danger when every second counts is an Emergency care. This field
consists of the place or the location where services were provided to the
patient. Location details are printed in block 32 of CMS-1500 form.
Details like location name, address are printed. Where services are

rendered in patient’s home & physician’s office location details in CMS-
1500 form can be blank.
7. Preauthorization: An insurance plan requirement in which you or your
primary care physician must notify your insurance company in advance
about certain medical procedures (like outpatient surgery) in order for those
procedures to be considered a covered expense. Preauthorization are of two
types. 1) Requesting authorization of date of services that have not been
previously requested or the request was previously rejected. 2) Requesting
authorization for increase or decrease units for previously approved dates of
service. In other words, Preauthorization means Insurance is notified in
advance about specific procedures. This allows for a review of medical
necessity, efficiency, and quality of proposed care. It is also an opportunity
to inform patient/physician about benefits, including length-of-stay
guidelines and plan limitations. This will help to understand the costs if
patient receive the proposed care.
8. Procedure Code: Procedure codes are used to indicate the kind of
treatment or service was administered in patient. Utmost care should be
given while entering the procedure code. We need to first know what kind
of procedure code each insurance accepts to process claims. Healthcare
Common Procedure Coding System (HCPCS) is a coding system that is
composed of Level I codes (Current Procedural Terminology (CPT) codes),
Level II codes (national codes), and Level III codes (local codes). Level I
(CPT) codes are five digit numeric codes that describe procedures and tests.

CPT codes are developed and maintained by the AMA with annual updates.
Level II (national) codes are five digit alpha numeric codes that describe
pharmaceuticals, supplies, procedures, tests and services. Level II codes
are developed and maintained by CMS with quarterly updates. Level III
(local) codes are five digit alpha numeric codes that are being phased out
by the fiscal intermediaries.
Examples of CPT codes:
• 85025 – CBC with automated differential
• 71020 – Chest x-ray 2 views
• 45378 – Colonoscopy
• 93501 – Right heart catheterization
In other words, this field contains the Code of the procedure done
(CPT/HCPCS Code). The purpose of CPT is to provide a uniform language
that accurately describes medical, surgical, and diagnostic services, and
thereby serves as an effective means for reliable nationwide communication
among physicians, patients, and third parties. All the Procedure codes are
stored in a Master database of the Medical Billing software with the
description of the code and the dollar amount. This helps the charge entry
person to cross verify the procedure before saving the claim.
This field is printed in the 24d field and the corresponding dollar amount of
the procedure stored in the Medical Billing Software is printed in the 24f
field of the CMS-1500 claim form

9. Modifiers: A modifier indicates that a service or procedure was altered
by specific circumstances, but not changed in its definition or code.
Modifiers are two digit numeric or alpha numeric codes that are appended to
the end of CPT/HCPCS codes. Modifiers may be used to indicate that:
• A service or procedure has both a professional and technical
component
• A service or procedure was performed by more than one physician
• A service or procedure has been increased or reduced
• Only part of a service was performed
• An additional service was performed
• A bilateral procedure was performed more than once
• Unusual events occurred
This field is printed along with the CPT/HCPCS Code in 24d field of the
CMS-1500 Claim Form.
A list of the most frequently used CPT (Current Procedural Terminology)
modifiers, HCPCS (HealthCare Financing Administration's Common
Procedure Coding System) modifiers, and local modifiers has been compiled
for reference.
These modifiers and associated nomenclature emanated from three different
sources.

Physician's Current Procedure Terminology, CPT 1999 was used for the
definition of CPT-4 numeric modifiers with one modification. The five digit
modifiers identified in the CPT are not included in these definitions since the
Medicare program does not recognize reporting modifiers in this format.
The HCPCS (Health Care Financing Administration's Common Procedure
Coding System) alpha modifiers were developed by the Health Care
Financing Administration for use in the Medicare program.
Local alpha modifiers were developed by Pennsylvania Blue Shield to
address situations not included in CPT-4 or HCPCS.
For some of these modifiers, additional clarification (shown as indented
text) has been added, as well as examples. Other modifiers are self-
explanatory; no additional comment is provided.
Modifiers provide the means by which the reporting provider can indicate a
service or procedure that has been performed has been altered by some
specific circumstance but not changed in its definition or code.
Modifiers may be used to indicate that:
• a service or procedure has both a professional and technical component

• a service or procedure was performed by more than one physician
• a service or procedure has been increased or reduced
• only part of a service was performed
• an adjunctive service was performed
• a bilateral procedure was performed
• a service or procedure was provided more than once unusual events
occurred
Anesthesia
One of the following modifiers must be reported with anesthesia services to
indicate who performed the anesthesia service:
• AA - Anesthesia services performed personally by anesthesiologist
• AD - Medical supervision by a physician: more than four concurrent
anesthesia procedures
• QJ - Medically directed by a physician: two concurrent procedures
(for services prior to January 1, 1995)
• QK - Medically directed by a physician: two, three, or four concurrent
procedures (effective for services on or after January 1, 1995)
• QO - Medically directed by a physician: three concurrent procedures

• QQ - Medically directed by a physician: four concurrent procedures
• QY - Anesthesiologist medically directs one CRNA
• QX - CRNA service: with medical direction by a physician
• QZ - CRNA service: without medical direction by a physician
The following modifier is reported in addition to one of the above modifiers
to indicate that monitored anesthesia care was provided:
• QS - Monitored anesthesia care service
Global Surgery
The following modifiers are used by physicians to indicate a billed service is
not part of a global surgical package and is eligible for separate
reimbursement:
24 - Unrelated Evaluation and Management Service by the Same Physician
During a Postoperative Period: The physician may need to indicate that an
evaluation and management service was performed during a postoperative
period for a reason(s) unrelated to the original procedure. This circumstance
may be reported by adding the modifier 24 to the appropriate level of E/M
service.

An excision of a malignant lesion on the left arm is performed in the office
on May 10, 1998. The ICD-9-CM diagnosis code reported is 171.2. The post-
operative period designated for excision code 11606 is 10 days.
The patient returns to the office on May 15, 1998 and is treated for contact
dermatitis, ICD-9-CM code 692.0. The physician should report the
appropriate evaluation and management code followed by the 24 modifier,
e.g., 9921224.
In order for the evaluation and management service to be payable in the
post-operative period with the 24 modifier, the diagnosis code supporting
the E/M service must be different from the diagnosis code reported for the
previously performed surgery.
Modifier 24 should not be used for the medical management of a patient by
the surgeon following surgery. Medicare recognizes modifier 24 only for the
care following a discharge under these circumstances:
The care is for immunotherapy management furnished by the transplant
surgeon;
The care is for critical care (99291, 99292) for a burn or trauma patient
under
diagnosis codes 800.0-929.9, 940.0-959.9; or

The documentation demonstrates that the visit occurred during a
subsequent hospitalization and the diagnosis supports the fact that it is
unrelated to the original surgery.
25 - Significant, Separately Identifiable Evaluation and Management Service
by the Same Physician on the Day of a Procedure: The physician may need
to indicate that on the day a procedure or service identified by a CPT code
was performed, the patient's condition required a significant, separately
identifiable E/M service above and beyond the usual preoperative and
postoperative care associated with the procedure that was performed. The
E/M service may be prompted by the symptom or condition for which the
procedure and/or service was provided. As such, different diagnoses are not
required for reporting of thre E/M services on the same date. This
circumstance may be reported by adding the modifier 25 to the appropriate
level of E/M service.
Note: This modifier is not used to report an E/M service that resulted in a
decision to perform major surgery. See modifier 57.
Visits by the same physician on the same day as a minor surgery or
endoscopy are included in the payment for the procedure, unless a
significant, separately identifiable service is also performed. For example, a
visit on the same day could be properly billed with the 25 modifier in
addition to billing for suturing a scalp wound if a full neurological
examination was made for a patient with head trauma. Billing for a visit
would not be appropriate if the physician only identified the need for sutures

and confirmed allergy and immunization status. In the circumstance when
the decision to perform a minor procedure is typically done immediately
before the service, (e.g., whether or not sutures are needed to close a
wound, whether or not to remove a mole or wart, etc.) it is considered a
routine preoperative service and a visit or consultation should not be
reported in addition to the procedure.
Effective immediately for dates of service on or after January 1, 1997,
separate payment may be made for an initial hospital visit (CPT codes
99221-99223), an initial inpatient consultation (CPT codes 99251-99255)
and a hospital discharge service (CPT codes 99238 and 99239) when billed
by the same physician for the same date as an inpatient dialysis service
(CPT code 90935-90947). It is no longer required that these evaluation and
management services be unrelated to the treatment of the patient's ESRD
in order for payment to be made. However, the 25 modifier must still be
reported with these evaluation and management services in order to
indicate that they are significant and separately identifiable services.
Physicians may request reviews of previously denied services.
57 - Decision for Surgery. An evaluation and management service that
resulted in the initial decision to perform the surgery may be identified by
adding modifier 57 to the appropriate level of E/M service.

E/M services on the day before or on the day of major surgery ( 90 day
global period) which result in the initial decision to perform the surgery are
not included in the global surgery payment. These E/M services may be
billed separately and identified with the 57 modifier.
This modifier should not be used for visits furnished during the global period
of minor procedures (0 or 10 day global period ) unless the purpose of the
visit is a decision for major surgery. This modifier is not used with minor
surgeries because the global period for minor surgeries does not include the
day prior to the surgery. When the decision to perform the minor procedure
is typically done immediately before the service, it is considered a routine
preoperative service and a visit or consultation is not billed in addition to
the procedure. See modifier 25.
58 - Staged Procedure or Service by the Same Physician During the
Postoperative Period: The physician may need to indicate that the
performance of a procedure or service during the postoperative period was
planned prospectively at the time of the original procedure. This
circumstance may be reported by adding the modifier 58 to the staged
procedure.
Note: Medicare policy limits the use of this modifier to staged procedures.
The CPT-4 definition of this modifier is broader in scope. This modifier is not
used to report the treatment of a problem that requires a return to the
operating room. See modifier 78.

It would not be appropriate to report this modifier for codes which indicate
in the terminology "one or more sessions", e.g., 66761, 67141, 67227.
These codes are defined by CPT-4 as consisting of one or more sessions.
The relative value units represent the work for the total number of sessions
necessary for completion of the procedure. Therefore, subsequent sessions
performed within the global period of the initial surgery are included in the
global fee.
59 - Distinct Procedural Service: Under certain circumstances, a provider
may need to indicate that a procedure or service was independent from the
services performed on the same day. See Appendix C
(Correct Coding Initiative) for more information regarding the use of
modifier 59.
78 - Return to the Operating Room for a Related Procedure During the
Postoperative Period: The Physician may need to indicate that another
procedure was performed during the postoperative period of the initial
procedure. When this subsequent procedure is related to the first, and
requires the use of the operating room, it may be reported by adding the 78
modifier to the related procedure.
When treatment for complications requires a return trip to the operating
room, physicians must bill the CPT-4 code that describes the procedure (s)
performed during the return trip. If no such code exists, use the unspecified
procedure code in the correct series, e.g., 47999 or 64999. In this situation,

you must include operative notes with the claim or a narrative description
which will allow us to understand the extent of the service performed. The
procedure code for the original surgery is not used except when the
identical procedure is repeated.
An operating room for this purpose is defined as a place of service
specifically equipped and staffed for the sole purpose of performing
procedures. The term includes a cardiac catheterization suite, a laser suite,
and an endoscopy suite. It does not include a patient's room, a minor
treatment room, a recovery room, or an intensive care unit ( unless the
patient's condition was so critical there would be insufficient time for
transportation to an operating room).
A partial colectomy is performed in the hospital on March 1, 1999. The
postoperative designation for this procedure (code 44140) is 90 days.
On March 15, 1999, the patient is returned to the operating room for a
secondary suture of the abdominal wall. This procedure should be reported
as 4990078.
79 - Unrelated Procedure by the Same Physician During the Postoperative
Period: The physician may need to indicate that the performance of a
procedure or service during the postoperative period was unrelated to the
original procedure. This circumstance may be reported by using the modifier
79.

A repair of a femoral hernia (49550) is performed on January 5, 1999. The
postoperative period designation for this procedure code is 90 days.
On February 12, 1999, the same physician performs an appendectomy. The
physician should report the appendectomy as 4495079.
Surgical
50 - Bilateral Procedure: Unless otherwise identified in the listings,
bilateral procedures that are performed at the same operative session
should be identified by adding the modifier 50to the appropriate five digit
code.
Report such procedures as a single line item with a unit of 1. For example,
when procedure code 19180 (Mastectomy, simple, complete) is performed
bilaterally, report the service as 1918050.
If a procedure is identified by the terminology as bilateral ( or unilateral or
bilateral), do NOT report the procedure code with modifier 50. For example,
procedure code 68810 to 68815, (probing of nasolacrimal duct, with or
without irrigation, unilateral or bilateral) includes terminology which
indicates the procedure is performed either unilaterally or bilaterally.
Therefore it's not appropriate to report this modifier with this code.
Additionally some procedure codes, i.e., 52000 (Cystourethroscopy,
separate procedure) should NOT be reported with the 50 modifier since
anatomy does not permit this procedure to be performed bilaterally.

51 - Multiple Procedures: When multiple procedures, other than
evaluation and management services, are performed on the same day or at
the same session by the same provider, the primary procedure or service
may be reported as listed. The additional procedure(s) or service(s) may be
identified by appending the modifier 51 to the additional procedure or
service code(s).
Note: This modifier should not be appended to designated "add-on" codes
(e.g., 22612, 22614). For more information, please reference chapter 22,
section 22.1
53 - Discontinued Procedure: Under certain circumstances, the physician
may elect to terminate a surgical or diagnostic procedure. Due to
extenuating circumstances or those that threaten the well being of the
patient, it may be necessary to indicate that a surgical or diagnostic
procedure was started but discontinued. This circumstance may be reported
by adding the modifier 53 to the code reported by the physician for the
discontinued procedure.
Use modifier 53 (discontinued procedure) to report a failed or terminated
colonoscopy, or a failed or discontinued procedure. Documentation
describing the circumstances requiring the discontinuation of a procedure
should be provided with the claim submission. If this information is NOT
included, your claim may be denied.

Note: This modifier is not used to report the elective cancellation of a
procedure prior to the patient's anesthesia induction and/or surgical
preparation in the operating suite. For outpatient hospital/ambulatory
surgery center (ASC) reporting of a previously scheduled f
procedure/service that is partially reduced or cancelled as a result of
patient prior to or after administration of anesthesia, see modifiers 73 and
74 (see modifiers approved for ASC hospital outpatient use).
54 - Surgical Care Only: When one physician performs a surgical
procedure and another provides preoperative and/or postoperative
management, surgical services may be identified by adding the modifier 54
to the usual procedure code.
Services billed with a 54 modifier will be reimbursed at the intraoperative
allowance for the surgical procedure. The intraoperative allowance includes
the one day preoperative care, the intraoperative service, as well as any in-
hospital visits that are performed.
55 - Postoperative Management Only: When one physician performs the
postoperative management and another physician has performed the
surgical procedure, the postoperative component may be identified by
adding the modifier 55 to the usual procedure number.

This modifier is used to identify postoperative, out of hospital medical care
associated with a given surgical procedure. When billing for postoperative
care only, report the original date of surgery as your date of service and the
procedure code for the surgical procedure followed by the 55 modifier. In
rare situations where the out of hospital postoperative care is split between
physicians, each physician must also indicate the period of his/her
responsibility for the patient's postoperative care by reporting the
appropriate range of dates.
Where a transfer of postoperative care occurs, the receiving physician
cannot bill for any part of the global services until he/she has provided at
least one service.
62 - Two surgeons: Under certain circumstances the skills of two surgeons
(usually with different skills) may be required in the management of a
specific surgical procedure. Under such circumstances the separate services
may be identified by adding the modifier 62 to the procedure number used
by each surgeon for reporting his services.
Under some circumstances the individual skills of two surgeons are required
to perform surgery on the same patient during the same operative session.
This may be required because of the complex nature of the procedure(s)
and /or the patient's condition.

If two surgeons, usually with different skills, are required to perform a
single surgical procedure, each surgeon bills for the procedure with modifier
62. Co-surgery also refers to single surgical procedures involving two
surgeons performing the parts of the procedure simultaneously, e.g., heart
transplant or bilateral knee replacements. Documentation of the medical
necessity for two surgeons is required for certain services identified by the
Health Care Financing Administration.
66 - Surgical Team: Under some circumstances, highly complex
procedures (requiring the concomitant services of several physicians, often
of different specialties, plus other highly skilled, specially trained personnel
and various types of complex equipment) are carried out under the "surgical
team" concept. Such circumstances may be identified by each participating
physician with the addition of the modifier 66 to the basic procedure
number used for reporting services.
Documentation establishing that a surgical team was medically necessary is
required for certain services identified by the Health Care Financing
Administration. All claims for team surgeons must contain sufficient
information i.e., operative reports, to allow pricing "by report".
73 - Discontinued out-patient hospital/ambulatory surgical center
(ASC) procedure prior to the administration of anesthesia: due to
patient, the physician may cancel a surgical or diagnostic procedure
subsequent to the patient’s surgical preparation (including sedation when

provided, and being taken to the room where the procedre is to be
preformed), but prior to the administration of anesthesia (local, regional
block(s) or general). Under these circumstances, the intended service that
is prepared for but cancelled can be reported by its usual procedure number
and the addition of the modifier 73.
Note: The elective cancellation of a service prior to the administration of
anesthesia and/or surgical reparation of the patient should not be reported.
For physician reporting of a discontinued procedure, see modifier 53.
74 - Discontinued out-patient hospital/ambulatory surgical center
(ASC) procedure after administration of anesthesia: due to extenuating
circumstances or those that threaten the well being of the patient, the
physician may terminate a surgical or diagnostic procedure after the
administration of anesthesia (local, regional block(s) or general) or after the
procedure was started (incision made, incubation started, scope inserted,
etc). Under these circumstances, the procedure started but terminated can
be reported by its usual procedure number and the addition of the modifier
74.
Note: The elective cancellation of a service prior to the administration of
anesthesia and/or surgical preparation of the patient should not be
reported. For physician reporting of a discontinued procedure, see modifier
53.

80 - Assistant Surgeon: Surgical assistant services may be identified by
adding the modifier 80 to the usual procedure number (s). This modifier
should be reported to identify surgical assistant services performed in a
non-teaching setting or in a teaching setting when a resident was available
but the surgeon opted not to use the resident. In the latter case, the service
is generally not covered by Medicare. When the surgical services are
performed in a non-teaching setting, report "Non-teaching" in the narrative
section of an electronic claim submission, or in Block 24D for paper claims.
Note: Please reference Chapter 22 for more information on assistant
surgery reporting requirements.
82 - Assistant Surgeon (when qualified resident surgeon not available):
The unavailability of a qualified resident surgeon is a prerequisite for use of
modifier 82 appended to the usual procedure code number (s).
This modifier is used in teaching hospitals if there is no approved training
program related to the medical specialty required for the surgical procedure
or no qualified resident was available.

Health Professional Shortage Area (HPSA)
These modifiers are used by physicians to indicate the services reported
were rendered in a qualified
Health Professional Shortage Area (HPSA) and are eligible for the 10%
incentive payment.
• QB - Physician providing service in a rural HPSA
• QU - Physician providing service in an urban HPSA
Additional CPT Modifiers
22 - Unusual Procedural Services: When the service(s) provided is
greater than what is usually required for the listed procedure, indicate this
by adding modifier 22 to the procedure code. A report is also required.
For services on the physician fee schedule, modifier 22 is applicable only to
those procedure codes for which the global surgery concept applies,
whether the procedure code is surgical in nature or not. Supportive
documentation, e.g., operative reports, progress notes, order sheets,
pathology reports, etc., must be submitted with the claim.
Note: Modifier 22 will be removed when reported with procedures that do
not have a global surgery period of 0, 10, or 90 days.

26 - Professional Component: Certain procedures are a combination of a
physician component and a technical component. When the physician
component is reported separately, the service may be identified by adding
the modifier 26 to the usual procedure number.
52 - Reduced Services: Under certain circumstances a service or
procedure is partially reduced or eliminated at the physician’s discretion.
Under these circumstances the service provided can be identified by its
usual procedure number and the addition of the modifier -52, signifying that
the service is reduced. This provides a means of reporting reduced services
without disturbing the identification of the basic service.
Use modifier 52 (reduced service) to indicate a service or procedure is
partially reduced or eliminated at the physician’s election. When you report
modifier 52, include office records, test results, operative notes, or hospital
records to substantiate the reason for reporting a reduced service. If this
information is NOT included, your claim may be denied.
Note: Effective January 1, 1999, for hospital outpatient reporting of a
previously scheduled procedure/service that is partially reduced or cancelled
as a result of extenuating circumstances or those that threaten the well-
being of a patient prior to or after administration of anesthesia, see
modifiers 73 and 74 (see modifiers approved for ASC hospital outpatient
use). 76 - Repeat Procedure by Same Physician: The physician may need to
indicate that a procedure or service was repeated subsequent to the original

service. This circumstance may be reported by adding the modifier 76 to the
repeated service.
Note: When it is medically necessary to repeat a service, the first service
should be reported in the usual manner. The repeat service should be
reported on the next line with modifier 76 appended to the procedure code.
In the event it is medically necessary to repeat a procedure more than
twice, report the second line with the 76 modifier and the appropriate
number of units in the units field. If a service is repeated more than once,
additional documentation should be provided in the narrative field of the
claim to support the medical necessity of the repeat services. The patient's
medical records must always document the medical necessity of performing
repeat procedures and be available to the carrier upon request.
77 - Repeat Procedure by Another Physician: The physician may need
to indicate that a basic procedure or service performed by another physician
had to be repeated. This situation may be reported by adding modifier 77 to
the repeated service.
90 - Reference (Outside) Laboratory: When laboratory procedures are
performed by a party other than the treating or reporting physician, the
procedure may be identified by adding the modifier 90 to the usual
procedure number.
For the Medicare program, this modifier is used by independent clinical
laboratories when referring tests to a reference laboratory for analysis.

91 - Repeat clinical diagnostic laboratory test: In the same course of
treatment of the patient, it may be necessary to repeat the same laboratory
test on the same day to obtain subsequent (multiple) test results. Under
these circumstances, the laboratory test performed can be identified by its
usual procedure number and the addition of the modifier 91.
Note: This modifier may not be used when tests are rerun to confirm initial
results; due to testing problems with specimens or equipment; or for any
other reason when a normal, one-time, reportable result is all that is
required.
This modifier may not be used when other code(s) describe a series of test
results (e.g., glucose tolerance tests, evocative/suppression testing). This
modifier may only be used for laboratory test(s) performed more than once
on the same day on the same patient. (Note: Effective for dates of service
1/1/2000 and after.)
99 - Multiple Modifiers: Under certain circumstances two or more
modifiers may be necessary to completely delineate a service. In such
situations, modifier 99 should be added to the basic procedure and other
applicable modifiers may be listed as part of the description of the service.
Note: This modifier should be used by providers submitting claims
electronically when it is necessary to report more than two modifiers. In this
situation, other applicable modifiers should be reported in the narrative
portion of the electronic claim.

Additional HCPCS Modifiers
• AH - Clinical Psychologist
• AJ - Clinical Social Worker
• AM - Physician, team member service
• EJ - Subsequent claims for a defined course of therapy, e.g., EPO,
Sodium Hyaluronate, Infliximab.
• E1 - Upper left, eyelid
• E2 - Lower left, eyelid
• E3 - Upper right, eyelid
• E4 - Lower right, eyelid
Note: These modifiers can be used to specify on which eyelid services were
performed. Comprehensive and component code combinations performed
on different eyelids are separately payable.
• FA - Left Hand, thumb
• F1 - Left hand, second digit
• F2 - Left hand, third digit
• F3 - Left hand, fourth digit
• F4 - Left hand, fifth digit
• F5 - Right hand, thumb
• F6 - Right hand, second digit
• F7 - Right hand, third digit
• F8 - Right hand, fourth digit

• F9 - Right hand, fifth digit
Note: These modifiers can be used to indicate that rebundled services were
performed on different digits. Separate payment will be allowed when
column I & II services are performed on different digits. See Appendix C for
comprehensive and component code combinations.
• G6 - ESRD patient for whom less than six dialysis sessions have been
provided in a month
• G7 - Pregnancy resulted from rape or incest or pregnancy certified by
physicians as life threatening
• GA - Beneficiary authorization
Effective for dates of service on and after October 1, 1995, report this
modifier to indicate that advance written notice was provided to the
beneficiary of the likelihood of denial of a service as being not reasonable
and necessary under Medicare guidelines. See chapter 6, page 6-6.1 for
example of written notice.
GC - This service has been performed in part by a resident under the
direction of a teaching physician.
GE - This service has been performed by a resident without the presence of
a teaching physician under the primary care exception.
Note: GE, for this purpose, is for use on all services except ambulance.

GH - Diagnostic mammogram converted from screening mammogram on
the same day
GN - Service delivered personally by a speech-language pathologist or
under an outpatient speech-language pathology plan of care
GO - Service delivered personally by an occupational therapist or under an
outpatient occupational therapy plan of care
GP - Service delivered personally by a physical therapist or under an
outpatient physical therapy plan of care
GT - Via interactive audio and video telecommunication systems
GX - Service not covered by Medicare
Note: Effective January 1, 1999, when a beneficiary refuses to have an x-
ray, the claim must be billed
using the correct chiropractic HCPCS code (98940, 89841, or 98942) along
with the new GX modifier.
QA: - FDA investigational device exemption. FDA-approved investigational
devices and/or services incident to the use of such devices should be billed
using the appropriate HCPCS code and the QA modifier. When billing a
service with the QA modifier, you are certifying FDA approval of a clinical
trial or the device and that the device was approved at the time the service
was rendered.

The FDA will issue an investigational device exemption (IDE) number that
corresponds to each FDA-approved device that has been granted an
investigational device exemption.
Providers must obtain the investigational device exemption number from
the manufacturer supplying the device in the clinical trial.
LT - Left side (used to identify procedures performed on the left side of the
body)
If used to substantiate different body sites, this modifier can exclude
services from rebundling.
Q1 - Documentation on file for ambulatory or non-ambulatory patients that
indicates mycosis/dystrophy of the toenail causing secondary infection
and/or pain which results or would result in marked limitation of ambulation
and require the professional skills of a provider.
Note: This modifier is applied to ambulatory as well as non-ambulatory
patients. Documentation that these conditions exist must be maintained in
the patient's file.
Q3 - Live kidney donor: services associated with postoperative medical
complications directly related to the donation.
This modifier is effective for services furnished on or after January 1, 1995.

These postoperative services will be reimbursed at 100% of the allowed
charge as required in Section 1881 (d) of the Social Security Act.
The following bullets are some reporting notes and tips for submitting
kidney donor services:
In the event that more than two modifiers are required when reporting
postoperative physician services furnished to live kidney donors, it is
important that the Q3 modifier is reported in the first modifier position. This
is necessary to ensure that these services are reimbursed at 100%.
Services are to be reported under the name and HIC number of the
recipient of the kidney donation. Procedure code 50320, Donor nephrectomy
from living donor, should continue to be reported with the YA modifier to be
reimbursed at 100% of the allowed charge.
• Q4 - Service for ordering/referring physician qualifies as a service
exemption for laboratory services
• Q5 - Service furnished by a substitute physician under a reciprocal
billing arrangement
• Q6 - Service furnished by a locum tenant physician
• Q7 - One Class A Finding
• Q8 - Two Class B Findings
• Q9 - One Class B and Two Class C Findings
• Note: Modifiers Q7, Q8, and Q9 are effective for dates of service on
and after October 1, 1995 and are to be used to bill podiatric
services.

• QP: - Documentation is on file showing that the lab test(s) was
ordered individually or ordered as a CPT-recognized panel other than
automated profile codes 80002-80019, G0058, G0059 and G0060.
• QR - Repeat clinical diagnostic laboratory test performed on the same
day to obtain subsequent reportable test value(s) (separate
specimens taken in separate encounters.) (This modifier should not
be used for dates of service after 12/31/1999. See modifier -91.)
• QW - CLIA Waived Tests (Please reference appendix Ha for additional
information.)
• QY - Medical Direction of one certified registered nurse anesthetist
(CRNA) by an anesthesiologist.
• RT - Right side (used to identify procedures performed on the right
side of the body)
If used to substantiate different body sites, this modifier can exclude
services from rebundling.
• SF - Second opinion ordered by a Professional Review Organization
(PRO) per section 9401, P.L.
• 99-272 (100 % reimbursement - no Medicare deductible or
coinsurance)

SG - Ambulatory surgical center (ASC) facility service
This modifier is only used by the ASC for identifying the facility charge. It
should not be reported by the physician when reporting his/her professional
service rendered in an ASC.
• TA - Left foot, great toe
• T1 - Left foot, second digit
• T2 - Left foot, third digit
• T3 - Left foot, fourth digit
• T4 - left foot, fifth digit
• T5 - Right foot, great toe
• T6 - Right foot, second digit
• T7 - Right foot, third digit
• T8 - Right foot, fourth digit
• T9 - Right foot, fifth digit
Note: These modifiers can be used to indicate that comprehensive or
component code combinations were performed on different digits. Separate
payment will be allowed when column I & II services are performed on
different digits. See Appendix C (New Correct Coding Combinations).
TC - Technical component: Under certain circumstances a charge may be
made for the technical component alone. Under those circumstances the
technical component charge is identified by adding modifier TC to the usual
procedure code number.

W7 - Kidney Donor (see modifier Q3 for more information)
XJ - Course of treatment has ended (radiation therapy) This modifier
is used to indicate the course of treatment for radiation therapy has ended.
If this modifier is not reported, additional fractions will be denied.
YR - Services performed by another provider but billed as services
performed "incident to" the personal professional services of the billing
physician/non-physician.
Beginning January 1, 1997, services provided ìncident to' the personal
professional services of a physician/non-physician must be billed using the
YR modifier. The YR modifier is intended to be attached to all personal
professional services performed ìncident to' which may be identified by a
CPT or HCPCS level I or II code. In general, ìncident to' services are
services performed by a physician's or non-physician provider's employee,
but reported on the claim as if the billing physician or non-physician
provider has provided the service.
YY - Second surgical opinion (See modifier SF for PRO-ordered services)
ZD - Routine non-covered services
Services reported with this modifier will be denied as non-covered.

ZP - No purchased services (*) DO NOT REPORT THIS MODIFIER * Effective
with claims received on or after June 23, 1998, do not report the ZP
modifier with diagnostic service. If the technical portion of the diagnostic
services was NOT purchased block 20 (or electronic equivalent) should be
checked “NO”. If the technical portion of the diagnostic service was
purchased, blocks 20 and 32 of the CMS 1500 claim form (or electronic
equivalent) must be completed to meet purchased service criteria.
ZX - Medical necessity for portable Xray suppliers and independent
physiological laboratories DO NOT
REPORT THIS MODIFIER Note: Providers/Suppliers are required to maintain
medical necessity documentation on file.
ZZ - Third surgical opinion.
10. Diagnosis Code: Diagnosis code is used to indicate the health problem
that a patient have. The first of these codes is the ICD-9-CM diagnosis code
describing the principal diagnosis (i.e. the condition established after study
to be chiefly responsible for causing this hospitalization). The remaining
codes are the ICD-9-CM diagnosis codes corresponding to additional
conditions that coexisted at the time of admission, or developed
subsequently, and which had an effect on the treatment received or the
length of stay. Medicare requires physicians to include a complete diagnosis
code (or codes) on each claim submitted for payment. The first of these
codes is the ICD-9-CM (International Classification of Diseases Ninth

Revision Clinical Modification) diagnosis code describing the principal
diagnosis (i.e. the condition established after study to be chiefly responsible
for causing this hospitalization). A Maximum of 4 diagnosis codes can be
printed on the CMS-1500 claim form.
This field is printed in the 21st field of the CMS-1500 claim form.
11. Number of days/Units: This field contains the length of service
performed. We need to enter number of days or units. This field is most
commonly used for multiple visits, units of supplies, anesthesia minutes or
oxygen volume. If only one service was performed the numerical 1 should
be entered.
12. Billed Amount: It is the amount charged by a provider for a specific
service. In other words it is the total charge value of the claim. The billed
amount for a specific procedure code is based on the provider.

MEDICAL BILLING – CASH POSTING
What is Cash Posting?
Cash posting is a process by which the payments received from insurance
companies, patients and other entities, towards settlement of claims, applied to
the respective claims / patient accounts or other accounts in the billing system.
Cash team receives the cash files (Check copy and EOB) and applies the payments
in the billing software against the appropriate patient account. During cash
posting, overpayments are immediately identified and necessary refund requests
are generated for obtaining approvals. Also underpayments/denials are informed
to the Analysts.
How the cash is generated, received and posted?
The charges submitted to the insurance will be processed payment is made
according to the fee schedule. The insurance pays the cash through checks which
is deposited in the specified banks date-wise. Each check has its own unique
number and date on which the check was issued. The checks along with the claim
details are received by the Billing Office in U.S who in turn groups a certain
amount together and sends to the billing office here. The details which are
received with the checks are known as the EOB (Explanation of Benefits).

The Billing office in U.S scans the Checks and EOB details to the Billing Office here.
The Billing Office here receives the scanned documents as files. The received files
are then collected by the cash poster who gives the file reference numbers based
on the date on which the file was received. Then the cash poster matches the
checks with the EOB details. This process is termed as file sorting or Check
matching. Now the file had been sorted and the details are posted in the Software
which is called as the Cash Posting.
Electronic Posting
Cash posting can be done either manually or electronically. During manual
posting the above said methods are carried on whereas in case of electronic
posting the amounts deposited in the bank gets transmitted electronically to the
billing office here. The transmitted details are known as Electronic File Transfer i.e.
EFT’s. This Eft’s are received by the cash poster with the insurance reference
number. Then the Cash poster retrieves the transmitted details and starts posting
the cash electronically. In this posting the amounts that are allotted to the claims
get identified by the software itself and the respective amounts are posted, for
which the detailed EOB’S will be received later.
Once the posting is over the amount posted in the software is tallied with the
amount received. Then a detailed report containing the claim and its posting
details are taken which is helpful for any future references.

General Terms associated with Cash posting and their definitions:
• Claim:
Forms submitted for payment of physician services, other medical
services and supplies provided to Insurance beneficiaries. It is an itemized
statement of healthcare services and their costs provided by hospital, physician's
office or other healthcare facility. A charge when filed to insurance becomes a
claim.
• Insurance Claim number:
It is the number given by the insurance to the claim in order to identify
the claim in case of reference. Some insurance companies address the claim with
the help of the claim number. It can be of the combination of any numeric values
along with the alphabetical values. It is insurance specific and no general format is
there for this.
For Example: - 12345ABXCQ78.
• EOB:
It is defined as Explanation of Benefits. This contains the claim details,
the amount paid by the insurance, Co-pay / Co-insurance amount and write-off
amount. It also contains the patient name, patient address, patient account
number, SSN, insurance name, insurance address, insurance contact numbers and
it’s customer care numbers (if any). If insurance does not pay the claim then the
reason for which the claim was not paid i.e. the denial reason is also mentioned in

EOB. In simple words it can be defined as the detailed explanation of the benefits
provided by the insurance for the claim. Some insurance like Medicare have their
own format of EOB.
For Example:-
EOMB (Explanation of Medicare Benefits) contains a statement detailing the
amount of benefits paid or denied for services under the Medicare program.
• Billed amount:
It is the Amount charged for each service performed by the provider.
In other words it is the total charge value of the claim. The billed amount for a
specific procedure code is based on the provider. It may vary from place to place.
It is not common across all the states.
• Allowed amount:
The maximum reimbursement the member's health policy allows for a
specific service. It is the maximum dollar amount assigned for a procedure based
on various pricing mechanisms. Allowed amounts are generally based on the rate
specified by the insurance. This amount may be:
-a fee negotiated with participating providers.
-an allowance established by law.
-an amount set on a Fee Schedule of Allowance.
For Example:-
If the billed amount is $100.00 and the insurance allows $80.00 then the allowed
amount is $80.00 and the balance $20.00 is the write-off amount.

Formula: -
Allowed amount = Amount paid + co-pay / co-insurance + Deductible
• Paid amount:
It is the amount which the insurance originally pays to the claim. It is the
balance of allowed amount – Co-pay / Co-insurance – deductible. The paid amount
may be either full or partial. i.e. Full allowed amount being paid or a certain
percentage of the allowed amount being paid.
For Example:-
If the billed amount is $100.00 and the insurance allows $80.00 but the payment
amount is $60.00. Here $60.00 is the actual amount paid for the claim.
Formula: -
Paid amount = Allowed amount – (Co-pay / Co-insurance + Deductible)
• Co-pay:
The fixed dollar amount that patient requires to pay as patient’s share each
time out of his pocket when a service is rendered. This is paid during the time of
the visit. Co-pay ranges from $5.00 to $25.00. Co-pay’s are usually associated
with the HMO plan. The Co-pay amount is usually specified in the insurance card
copy.

• Co-insurance:
Co-insurance is the portion or percentage of the cost of covered services to
be paid either by insurance or patient. After the primary insurance making
payment the balance of the cost covered (Co-insurance) will be sent to
secondary insurance if the patient has one or to the patient.
For Example:-
If the billed amount is $100.00 and the insurance allows @80%. The payment
amount is $60.00 then the remaining $20.00 is the co-insurance amount.
Formula: -
Co-insurance = Allowed amount – Paid amount – Write-off amount.
• Deductible:
Deductible is the amount the patient has to pay for his health care
services, whereas only after the patient meets the deductible the health insurance
plan starts its coverage. The patient has to meet the Deductibles every year. It is
mostly patient responsibility and very rarely another payor pays this amount.
• Posting Reference Number:
This is the number which is given by the operator to the claims posted in
order to keep track of the payment posted details. This is generally given in a
specified format as per the client requirement.

For Example:-
01.3651.123103 here the 01 refers to the serial number, 3651 refers to the
batch number and 123103 refer to the date and the year on which the file was
received by us.
• Offset:
This is a kind of an adjustment which is made by the insurance when
excess payments and wrong payments are made. If insurance pays to a claim
more than the specified amount or pays incorrectly it asks for a refund or adjusts /
offsets the payment against the payment of another claim. This is called as Offset.
For example:-
Let the total billed amount of two claims is $100.00 each and the specified
payment for this is $80.00. The insurance pays $90.00 for the first claim. Here
$10.00 is paid in excess. Now while making payment for the second claim the
insurance pays $70.00 and sets $10.00 as offset. Now the insurance payment
becomes normal as the excess payment had been adjusted off.
• Refund:
This is the process of returning back the excess money paid by the
insurance / patient on request. If payment is received in excess than the specified
amount, insurance / patient request for a refund. The process of Refund is usually
done as per the client specifications.
For example:-

Let the total billed amount of a claim be $100.00 and the specified payment for
this is $80.00. The insurance pays $90.00 for the claim. Here $10.00 is paid in
excess. Now the insurance requests for a refund of $10.00 which will be done as
per the client specifications.
• Adjustment:
An adjustment is an amount which had been adjusted for some reason
and may be recoverable. It can be an additional payment or correction of records
on a previously processed claim. Adjustments are done based on the client
instructions. One specific type of adjustment is the write-off.
For Example:-
Let the billed amount of a claim be $100.00 and the paid amount is given as $70
and $ 30 is given as participating providers adjustment. So this $ 30 has to be
adjusted.
• Write-Off:- It is an amount which cannot be recovered at all. This write-
off is usually done when the insurance payments are made. It is the balance
of what the insurance have allowed on a particular charge i.e. Total Billed
amount – Allowed amount. The main difference between an adjustment and
write-off is that Adjustment may be recovered whereas write-off cannot be
recovered at all.
For Example:-

If the billed amount is $100.00 and the insurance allowed amount is $80.00. The
payment amount is $80.00 then the remaining $20.00 is the write-off amount.
• Denial :
Denial is the technical term used for the non-payment of a claim by the
insurance. The insurance usually pays the claim if the details presented to them
are sufficient enough for processing. If there is any lack of information then the
insurance quotes a reason for which the claim is not considered for payment which
is known to be the denial reason. These reasons are found in the EOB. Some
insurance like Medicare follow a general set of denial codes which is uniform
across all the states. But some commercial insurance follow their own set of
reasons codes for the denials which will be clearly mentioned in the EOB.
For Example:-
If the claim has gone to the insurance without the patient date of birth then the
insurance will not pay the claim stating a denial reason code to it.
• Balance Billing:
It is the difference between the billed amount and the amount
approved by insurance. Once the claim payment had been made by the
primary insurance and if there is any balance pending for the claim then the
balance is either sent to the secondary payor or to the patient.
If the patient is enrolled with the secondary payor then the balance is
billed to it. Generally for secondary billing the claim must be submitted

along with the primary payor’s EOB. Only then the secondary payor will pay
for the claim. In secondary billing primary payor EOB is the most important
document. Some insurance like Medicare automatically transfers the
pending balance to the secondary payer (Medicare Supplementary) if the
patient has any. This procedure is termed as Crossover which reduces the
work of the billing office.
If the patient is not enrolled with the secondary payor then the balance is
billed to the patient. Patient billing cannot be done at all the cases. For
certain cases we need the client’s approval for patient billing. Periodic
patient statements are sent to the patient in order to intimate the balance
which is pending from patient.
• Capitation Payment
Specified amount paid periodically to the provider for a group of specified
health services, regardless of quantity rendered. This is a method of payment in
which the provider is paid a fixed amount for each person served no matter what
the actual number or nature of services delivered. The cost of providing an
individual with a specific set of services over a set period of time, usually a month
or a year. It is a payment system where managed care plans pay the health care
providers a fixed amount to care for a patient over a given period. Providers are
not reimbursed for services that exceed the allotted amount. The rate may be
fixed for all members or it can be adjusted for the age and gender of the member.

MEDICAL BILLING – ACCOUNTS RECEIVABLES
What is Account Receivables?
Receivables are defined as amounts due and expected to be collected by billing /
provider’s office for the services provided to individuals. In Medical Billing,
receivables are handled by Account Receivables Department. Account Analyst
plays a crucial role in identifying and resolving issues which helps to reduce or
clear receivables.
What is the purpose of Claims review & AR Analysis?
The purpose of claim analysis is to identify and resolve medical claims billing and
reimbursement issues toward maximizing collections and minimizing accounts
receivables. It helps to ensure timely, accurate and final settlement of health
insurance claims and patient bills by insurers or patients as appropriate. The scope
of claim analysis is applicable to all health insurance claims and patient bills that
have not been fully and finally settled by liable party or parties comprising health
insurers, patients and others. It is the responsibility of the Accounts Receivables
Analyst to ensure that AR is under control & acceptable by industry standards.
What is the scope of AR Department?

AR Department has to ensure steady inflow of money from the insurance
company. The main motive of this department is to collect money for all the
treatments taken by the patients in a timely fashion. Usually the turn around
period for the payment by the insurance company is 30 – 45 days. Once the limit
is exceeded AR department has to make an enquiry for the delay. There are
various reasons for the delay like:
e) Correct details may not have been provided to the insurance companies.
f) Claims were sent correctly but Insurance Company may not have received
the claims.
g) The checks issued might have been sent to the wrong address.
h) The insurance company may delay the payments if they have a backlog and
they would inform us by a letter that they have received the claims and
would be making the payments shortly.
AR department acts as a hub around which other departments revolve. This
department can gather & update lot of billing information which is required to
settle a claim. Account analyst uses various reports available in billing software to
identify claims which have not been settled.
The Medical billing software is capable of running reports that pull out claims that
are unpaid for greater than 30 days. These are called aging reports and these
reports show pending payments in slots such as 0 – 30 days, 31-60 days and 61-
90 days. Claims filed within the last 30 days will find themselves in the first slot
(0-30days). Claims that are more than 30 days but less than 60 days old will be

found in the 31-60 days slot. A glance at this report will show the AR personnel
the claims that need to be followed up on with the insurance company.
Claims will be followed up over the telephone or by written correspondence. It
would be necessary to find out why the claims are yet to be paid and what needs
to be done to have these claims paid. The delay and denials will be corrected by
the billing office in coordination with the physician’s office and the insurance
carriers. The same applies when patient billing statements are sent out. The
patient is given 3-4 weeks to pay the bill and if the payment is not received with in
that time, the billing office will follow up with the patient

Accounts receivables - calling
Medical accounts receivable follow-up involves following up with entities such as
Insurance carriers, Physicians, Hospitals and patients for information required to
resolve the pending accounts at the earliest. Calling is a support media for A/R
Analyst to close an outstanding account. Calling is done on accounts which are
outstanding for more than 40 days and for which no correspondence has been
obtained.
Calls are made to the following entities by an AR representative:
 Insurance carriers
 Hospitals
 Physicians office
 Patients
Insurance carriers
Calls are made to insurance carriers for the following reasons:
1. Patient eligibility verification
Calls are made to the insurance carrier to confirm on the eligibility of the insured,
the type of insurance the subscriber has with the respective insurance and/or the
benefits that are covered by the insurance.

2. Provider enrollment department
Calls are made to the insurance carrier to confirm on the provider enrollment
details. In order to check whether the provider is participating with the insurance
and/or to enroll the provider with the insurance carrier.
3. Claim status
Calls are made to insurance company to enquire about the status of a claim that
has already been filed to them, but for which there has been no correspondence
from the insurance company for over 40 days.
Hospitals
Calls are made to the hospitals to check on the pre-authorization, pre-certification,
to confirm on medical records and also to check on patient’s coverage information
in case a contact cannot be established with the patient.
Physician’s office
Calls are made to the physician’s office/PCP office to obtain and confirm on the
referrals, to confirm on the patient’s coverage information incase a contact cannot
be established with the patient.

Patients
Calls are made to the patient to confirm on the insurance policy details, to obtain
and confirm on the patient’s other insurance details or to inform the patient about
their responsibility that is due from them to the doctor.
Under whose name do we call carriers & patient’s?
Calls are made to patients and insurance companies, hospitals, physician’s office
under the client’s name. Thus the carriers and patients would have no way of
knowing that they are being called from an outside firm, but rather the clients’ in
house collections department.
Who receives the payment collected by the ar representative?
The accounts receivables would be managed under the client’s name, therefore
the payments would be made directly to the client account as specified.
Calling – classification
Inbound:
Calls that the office receives from patients, insurance carriers etc is termed as
inbound.
 Patients call the billing office to check on the payments and on clarifications
when statements are sent to them periodically.
 Insurance carriers call the billing office when a message is left for them to
call us back and/or for clarifications on claims that have been filed with
them.

Outbound:
Calls that our office makes to the insurance carriers, patients, hospitals, provider’s
office etc are termed as outbound.
 Calls are made to insurance carriers to check on patient eligibility, provider
enrollment details and/or to check the status of the claim that is filed.
 Calls are made to the patient to follow-up on the payments, to confirm if the
statements sent have been received by them and also to check on their
insurance coverage information
 Calls are made to the hospitals, provider’s office to check on the
authorization details.
Abbreviations to update patient notes
Cld : Called.
TT : Talked to.
CPT : Current Procedural Terminology.
Dnd : Denied.
DOS : Date Of Service.
PCP : Primary Care Physician.
Auth# : Authorization number.
POS : Place Of Service.
EOB : Explanation of Benefits.
EOMB : Explanation of Medicare Benefits.

Chk : Check.
Pt : Patient.
Proc : Procedure code.
Clm : Claim.
Diag : Diagnosis.
Ins : Insurance
Pd : Paid
Amt : Amount
NIS : Not in system
Script on how to call insurance for status of a claim
Sample 1
Good morning, this is ……… calling from ………………. (name of the physicians office)
to check the status of the claim. (If the rep asks for the provider/ tax id #)…… The
Dr’s provider/tax id# is …………. The patient’s ID# id ………………., the patients name
is ………………. And the DOS is ………………. For a billed amount of ………………
(If the claim has been paid, ensure all the check points for a paid claim is verified
and confirmed.) Thank you for your kind assistance. Have a great day.

Sample 2
Good morning, this is ……… calling from ………………. (name of the physicians office)
to check the status of the claim. (if the rep asks for the provider/ tax id #)…… The
Dr’s provider/tax id# is …………. The patient’s ID# id ………………., the patients name
is ………………. And the DOS is ………………. For a billed amount of ……………….
(If the claim has been denied, ensure all the check points for a denied claim are
verified and the reason for the denial is obtained).
Thank you for your kind assistance. Have a great day.
Sample format for update Notes:
Called Insurance…………. . TT …………….. . She said that the DOS ………….. for the
billed amount………….. paid …………. On …………. Chk# is ………………… bulk check in
the amount of………..
Claim processed on…………. The copay is…….. the co-insurance is ………. And the
patient responsibility is …………. The check was mailed out to ……………. (address)
and the check is still ………. (out-standing).
The AR Process is completed only when the necessary action is taken after
the calls has been made and has the claim reprocessed and converts the pending
claims into receipts/cash. It has also to be noted that when ever a new update
pertaining to claims processing is received, the information should be shared with
the other departments so that the speed of the collection is increased and the
denials are reduced.

COMMON PHONETICS
A As in Apple
B As in Boy
C As in California
D As in David
E As in Edward
F As in Frank
G As in Girl
H As in Henry
I As in Indiana
J As in Jack
K As in Kite
L As in Larry
M As in Mary
N As in Nancy
O As in Orange
P As in Peter
Q As in Queen
R As in Robert
S As in Sam
T As in Tom
U As in Umbrella
V As in Victory
W As in Whisky
X As in X ray
Y As in Yellow
Z (zee) As in Zebra

ISSUING WORK ORDER
1) Age of the Pending Claim

2) Billed Amount
3) Timely filing limit of the insurance company/carrier.
4) Based on denials received.
Based on the Age the claims are classified in to 5 different age groups.
• 0-30 days: Claims falling under 30 days from the date of first filing.
• 31-60 days: Claims greater than 30 days but less than or equal to 60 days
from the date of first filing.
• 61-90 days: Claims greater than 60 days but less than or equal to 90days
from the date of first filing.
• 91-120 days and: Claims greater than 90 days but less than or equal to 120
days from the date of first filing.
• 120 - 150 days: Claims greater than 120 days but less than or equal to 120
days from the date of first filing.
• 150 days: Claims greater than 150 days.
The analyst sees that all the claims are followed up and necessary actions are
taken and callbacks are set for further course of action.
Work-orders issued based on the Billed amount
The claims with highest billed amount are identified and the same is placed for
calling. And the necessary actions are taken as per the feedback from the night
caller.
Work-orders issued based on the Timely-filing limit of the carrier
The insurance company/carriers with very short span of time for timely filing is
identified and the claims pertaining to those carriers are given for calling on
priority and necessary actions are taken based on the feedback from the night
callers.
Work-orders issued based on the Denials
The insurance company may send denials alone in their own format to the
Providers to know the denial reason for which they denied the claims. Those

denials will be given for calling and the necessary actions taken based on the
feedback from the night callers.
Procedures Followed For Issuing The Work-Orders:
a) The Ledger print outs are given to the night callers for their convenience.
b) On the ledger print out the analyst writes in short the previous issues of the
claim and also notes down the points that is to be enquired with the carrier.
Denials and action to be taken:
Callers with the help of the notes given by the analyst, calls the carrier and gets
the needed information from the callers.
To check for the status of the claim:
Analyst: Pending Claims above 30days which is not followed-up is given for Status
call.
Caller: Gets the status from the carrier, May be
a) Payment details
b) The denial reason
c) Claim Not in system etc.,
Based on the call the necessary action is taken by the analyst.
a) Payment Details: The caller should get the following when he is asking for
the payment details.
Check #
Check Date
Check Amount
Pay to Address
Cashed detail
Insurance Verification
Analyst: There may be cases were the charge dept/analyst may require to know
the correctness of the Member id# or the Mailing address etc of the patient with
the carrier.
Caller: Gets the mailing address, confirms the id# and other information.
The caller should get the following details.

Mailing address
Member Id#
Effective date
Authorization # required or not
Provider is Par or Non-Par
Based on the call information’s are checked and the corrective actions are taken.

Eligibility of the Patient’s Coverage
Analyst: Asks the caller to check for the validity of the coverage with the carrier.
Caller: Calls the carrier, confirms the validity of the coverage, and gets the
effective date and the termination date wherever possible.
Based on the call the necessary action is taken.
Check why the Procedure code was not considered
Analyst: Would have received the E.O.B wherein one of the line item is not
considered for payment, so the analyst asks the caller to check for the reason for
having not considered the line-item.
Caller: Gets the reason for the procedure code not being considered, say line-item
missed from being considered, denied for some reason, but the reason was not
specified in the E.O.B or the claim is sent for review and so the same will be
paid/denied in due course of time.
Based on the feedback the necessary action is taken, say a Callback date is set.
Claim Denied stating, “Lacks information needed for Adjudication”
Analyst: Receives an E.O.B with a particular procedure code denied with the above
reason. Asks the caller to get the exact reason for the denial.
Caller: Calls the carrier and gets the exact reason-Reason being “The claim should
be submitted along with the additional documents/Medical Notes to process the
claim”.
Based on the feedback from the caller the analyst sends a mail or Spread Sheet to
the Clients office requesting for Medical Notes. Once after receiving the same
claim is re-filed along with the medical records to the carrier.
Claim Denied stating “Diagnosis inconsistent with the Procedure code billed”
Analyst: Based on the denial received the analyst first sends nail/Spread Sheet to
the coding department to re-code the charge sheet with the correct Diagnosis,
after completion the same is given to the caller to update the new diagnosis in
their (carrier) system by telephonic conversation.
Caller: If accepted by the Rep, the new diagnosis is updated in the carriers system
or else the rep, requests for resubmission of the claim.
Based on the call made either the claim is marked for call back or else it is re-filed
with the new diagnosis.

Claim denied stating “No authorization on file”
Analyst: If there is authorization # present in the system then, the analyst gives
the same to the caller and asks to check if the same is valid for the provider,
procedure code, Date of Service and the Diagnosis code billed.
Caller: Call the carrier for validity of the authorization#.
Based on the feedback the action is taken.
Claim Denied for “Medical Necessity”
Analyst: The analyst asks the caller to enquire the rep, if the claim will be
processed with any additional information, if yes, what sought of additional
information is required.
Caller: Requests the rep to let them know what information is required in-order to
get the claims processed.
Based on the in-formation from the carrier the necessary action is taken.
Claim Denied stating “Bundled Service”
Analyst: Claim is denied stating “Bundled Service” asks the caller to get the
information as to, with which procedure code this particular procedure code is
bundled”.
Caller: The caller gets the info of the bundled service from the insurance
representative.
If the caller is not able to get the same then the analyst gets the help of the
Compliance dept. checks for the Bundled service information and based on this the
analyst generates report for that particular procedure code and sends a mail to the
client’s office for approval of write off.
For Ex. 82948 is bundled with 99213, 99214 and 99215.Here we are to write off
the procedure code 82948 with the consent of the Dr. (or) the client office.
Claim Denied for Missing or incomplete information in the HCFA
Analyst: Asks the caller for claim status.

Callers: Get reply from the Rep of the ins stating” Block 33 of the HCFA is missing
or incomplete”.
Action: The Analyst is supposed to print the HCFA and check for Block 33 to see if
there is any missing info or incomplete info, If yes then the analyst checks the
form setup and looks into it that the corrections are made and the claim is refiled.

Claim Denied for Incorrect procedure code
Analyst: Asks the caller to check why the particular procedure was not paid.
Caller: Gets feedback from the rep that the Procedure code is incorrect and so has
to be filed with the correct code.
Action: The analyst should update the claim in problem in the Coding SS asking
them to correct the same. Once the charge is corrected in the system the claim is
refiled to the carrier.
Claim Denied for want of Primary EOB
Analyst: Asks the caller for the Claims status (primary carrier of the pt).
Caller: Gets the feedback from the carrier as “Primary EOB required for processing
the claim”.
Action: The analyst has to first check if the patient has secondary insurance, if
yes, asks the caller to call the secondary ins to check if they are acting as primary
ins for this patient, if yes then the analyst sends a mail or updates the Charge SS
asking them to archive the primary coverage and refiles the claim to the correct
primary carrier.
If the call was for Secondary claim, then the analyst should attach the Primary
EOB with the secondary claim and sends the same to the carrier by mail.
Claim Denied as “Non Covered Service”
Analyst: Asks the caller to check under whose plan the Procedure was denied as
Non covered service.
Caller: Gets the info from the rep as “Non covered under patients plan” or “non
covered under providers plan”.
a) Non covered under Patient’s plan: Here the Analyst updates the client SS in
order to confirm if the claim can be flipped to the patient.
b) Non covered under provider plan: Here the analyst updates the Client SS to
check if we can Write-off the amount.
Claim Denied as “Duplicate Claim”
Analyst: Asks the caller to check for claim status.

Caller: Gets the reply from the rep as “Duplicate claim”.
Action: The analyst has to check in the software if the claim was entered twice
with the same DOS, Doctor, and Procedure. If yes, then the charge SS is updated
and the duplicate claim is deleted with the consent of the Charge Supervisor. If it
is not a duplicate then the analyst should place the call again for calling asking the
callers to check for the status of the claim which was submitted previously, either
the claim should have got paid or the claim should have got denied, in either case
the caller should get the details of the payment made or should get the details of
the denial.

Claim “Not in System”
Analyst: Asks for Claim status.

Caller: The feedback from the rep is that the claim is not in system.
Action: There are 2 steps to be followed
The analyst should first check if few claims were transmitted to the carrier on the
same date. If yes, then should ask the caller to check with the carrier stating
“there were few claims submitted on the same date out of which there are some
claims paid and some Denied if so then how this claim cannot be in system, the
caller should also give the date of confirmation to the rep.
If this was the only claim submitted on that date then the claim has to be refiled.
Claim Forwarded to another carrier
Analyst: Check for Claim status.

Caller: Gets info from the insurance representative that the claim has been
forwarded to another carrier.
Action: The analyst should ask the caller to call the ins to which the claim was
forwarded and check for the status, if claim is not in system then the caller is
supposed to enquire the member id # and the ins mailing address ad other
details, only then the analyst can take the proper action i.e., after getting the info
the analyst updates the charges SS and asks them to archive the coverage with
the correct primary coverage and refiles the claim.
Claim Denied as “Non-Par provider”
Analyst: Asks the caller to get the status of the claims.

Caller: Gets the info from the Rep as “denied as Non-par Provider”
Action: The analyst should ask the caller to check with the carrier if they will pay
@ non-par rates if yes, then the claim can be resubmitted to the carrier. if not, the
claim is updated in the client SS for Write off approval.
Claim Pending for want of information from the Patient
Analyst: Asks for the status of the claim

Caller: Gets the feedback as “Claim pending for want of information from the
patient”.
Action: The call back should be set after 15 days, and on 15th day can ask the
caller to call back and check if the carrier has received the needed info from the
patient. If no again to set a call back after 15day, can wait for one month, if still
the carrier does not receive the info, then with the consent of the client the claim
can be flipped to the patient.

Incorrect Place of Service
Analyst: Should check for the correctness of the POS, i.e. for consult the POS
should be 11, For Inpatient POS should be 21 and for Outpatient POS is 22.There
are different POS for different cases.
Callers: Callers can give the correct place of service if they have in their system to
reprocess the claim immediately.
Claim forwarded to pricing Aid, Pricing Review.
Analyst: To place a calling to check for the Mailing address, Fax number and the
Timely filing limit.
Callers: Callers should ask for the PAPR Mailing address, Ph# once they have been
informed that the claim has been forwarded to Pricing Aid Pricing Review.
Contractual Obligation, amount for which provider is financially liable. The patient
may not be billed for this amount
Analyst: Should send a mail or should update the Client SS to get write-off
approval.
Callers: No need to call
Claim/Service denied or reduced because this procedure/service is not

paid separately.
Analyst: Should first check with the Manual if the denied procedure code is a
"Bundled service", if yes has to check with the compliance department for the
details and should update the client SS for Approval of write off giving them the
reason and referring them the Manuel etc. If the Procedure code is not "Bundled
service" then the analyst can place a call with the insurance to check if the claim
will be processed if submitted along with the necessary documents.
Callers: Callers should ask for the Primary Procedure to which the component code
has been included.
Charges exceed our Fee schedule or Maximum allowable amount
Analyst: The billed amount should be corrected and the claim should be filed
again. Medicare has the Maximum Billed beyond which it is fraud. The Procedure
codes billed with a Billed amount more than their maximum billed amount will be
denied.

Claim denied for Pre-existing conditions
Analyst: The analyst after getting approval from the client will bill the patient, and
after getting the copy of the pre-existing condition certificate and medical
documents the claim will be submitted to the carrier.
Callers: After the submission of Claim with the Pre-existing condition certificate
from the Patient along with the medical documents, callers can call and give the
date of submission and the ref# which was assigned by the Carrier to the patient.
Claim denied for Date of Injury, First Diagnosis Used and for Pre-existing
conditions
Analyst: The analyst requests for the DOI, first Diagnosis code used and the Pre-
existing condition from the Client, after getting the same the claim is sent for
reprocessing. As this is a paper claim the call back will be placed after 45 days.
Callers: After the submission of Claim with the Pre-existing condition certificate
from the Patient along with the medical documents, callers can call and give the
date of submission and the ref# which was assigned by the Carrier to the patient.
Claim denied for “Primary paid more the Allowed Amount
Analyst: Write-off will be taken by the Analysts after getting a one time approval
from the client.
File the itemized bill with Insurance Card Copy
Analyst: The claim will be submitted as a itemized bill, i.e. the entries in the
claim will be date vice and not a clubbed entry for different date of service, and
along with the copy of the insurance card copy.
Callers: After the 30 days from the date of submission, the caller has to call
and verify the status of the claims.
Payment on this service/procedure has been with-held
Analyst: Should check if there is any other alternate procedure code existing for
the billed procedure code and yes then the same is informed to the charge dept.
and the claims with this deleted(from the cpt manual) procedure code is reentered
with the alternate procedure after which the claims are resubmitted.
Callers: Callers has to ask whether there is an alternative new procedure code for
this procedure code with regards to the services rendered.

File the claim to the Third Party Administrators
Analyst: Should file the claims to this Third party as per the information received
from the carrier. Once after getting the phone number of the TPA from the carrier
a call is made to the TPA. The Fax # and other details are obtained for future calls.
Callers: Caller has to call TPA and get the Pricing sheet through fax and place it on
the Analyst bay.
Confirm that Hospice Patient did not appoint the Rendering Doctor
Analyst: Medicare appoints an attending Dr for a Hospice Patient, if we receive a

denial from MCR as above, Analyst has to just write down as this in the Block# 19
of the HCFA "Attending Dr was mot appointed by the Patient".
Callers: Caller has to call after 20 days from the date of submission stating the
"hospice patient" claim status.
More than one unit of this service will be discounted
Analyst: There may be cases where, 2 units of the same procedure code will not
be paid by the carrier, we can check if the 2nd unit will be paid if submitted along
with a modifier and medical documents supporting the need for the service.
Callers: Callers has to ask why the one unit of the service was not paid. Callers
have to ask whether this procedure code can be reprocessed if the additional
documents were submitted.
Claim denied as Capitated
Analyst: Analyst has to first check with the client if we are capitated with the
particular carrier. The Rooster report is obtained from the carrier; this contains the
details of the claims under capitation. Based on this a capitated adjusted is raised
by the analyst to the cash posters.
Callers: Callers has to get the list of Procedure codes which are under the
capitation and Fee for Services.
Claim denied stating Need Corresponding Surgical Code
Analyst: When a claim is denied for want of Surgical code, we are to check the Cpt
manuals and should take the corresponding 4digit surgical code and the same
should be filed with the same to the carrier.
Callers: Nil
Based on calls the remarks column is updated and after taking necessary actions
the issues column is updated segregating the feedbacks under various heads.
Callbacks are set for further action.
This cycle goes on every month.

Action to be taken on denial issues:
Issue: Coverage Terminated
Action:
a) If the patient has only one coverage:

In this case the balance can be flipped to the patient.
b) If the patient has secondary coverage:

Give a work order to Insurance calling team. They need to call the secondary
carrier and check if they will be acting as a primary.
• If the secondary carrier says yes, then the claim is sent to the secondary.
Denial from the primary carrier needs to be attached if we have crossed the
timely filing limit of the secondary carrier. This will ensure that the claim will
be processed. Otherwise the claim may be denied by the secondary for
crossing the timely filing limit.
• If the secondary says no, then the patient has to be called for information
regarding his primary carrier.
c) If the denial is from Secondary:

The primary has already paid and the secondary has been billed for co-insurance.
If secondary rejects the claim stating that the coverage has terminated then the
balance can be directly flipped to the patient.
d) If another balance for same DOS has got paid:

Take this case. There are two balances for the patient for the same date of
service, a Doctor Balance & a CRNA balance. If the patient has got payment for a
Doctor balance and the carrier denies the CRNA balance citing termination of
coverage as the reason, then a work order has to be issued for insurance calling to
why we got paid for one and rejected for the other.
• If the carrier says that they have paid the Doctor balance in error then a
refund has to be initiated and the procedure as stated in point a & b
above should be followed.
• If the carrier has denied the CRNA balance incorrectly then they will
reprocess the claim.

Issue: Invalid or Missing Provider Id#
Action:
a) If there is no provider number in the system:
If the rejection is due to non availability of provider number in the system,

the same has to be obtained from the carrier through the enrollment process.
b) If there is a provider number in the system:
When the rejection states that the provider number is not valid for that particular
DOS, the issue should be forwarded to the provider enrollment team for retro
activation.
When the rejection does not specify anything but simply states invalid provider
number, then check if the number has been keyed in correctly in the system by
comparing the same with the original records available with the provider
enrollment department.
Issue: Invalid Procedure code
Action:
Check the charge sheet as to whether the rejection is due to wrong keying in
at the time of charge entry. If yes, correct the same and refile the claim. If not,
a) Check whether the carrier requires ASA or CPT code. If the Claim has gone with
incorrect code then the claim needs to be refiled with correct code. Forward this
issue to claims analyst who will check for errors of the same kind by running a
paid & outstanding report for that particular date of filing. This type of error occurs
due to lack of knowledge.
b) There is one more reason for getting this type of rejection. The carrier may not
be paying for some codes. So if point (a) is not applicable, this may be the cause
for rejection. A work order can be issued for the insurance calling team. If the
carrier says that they do not pay for the procedure then the amount has to be
written off.
There are some exceptional cases where the primary may not be paying for one
code whereas the secondary may consider the same (ex) Medicare won’t pay for
dental procedures whereas a secondary, Commercial may pay for the same.

Issue: Invalid Diagnosis code
Action: Two types of rejections are possible

Dx not matching with procedure code
The Dx reported on the claim is not to the highest level of specificity.
Check the charge sheet as to whether the rejection is due to wrong keying in at
the time of charge entry. If yes, correct the same and refile the claim. If no, it
may be because of incorrect Dx. It is also possible that the 4 or 5 digit Dx is used,
which the carrier may consider to be truncated
Issue: Invalid or missing modifier
Action:
a) First check whether modifier has been entered at the time of charge entry. If
no, have the same entered and resubmit the claim.
b) If modifier has been entered but the carrier rejects the same
Check whether the correct modifier has been used

If you find that the correct modifier has been used, then give a work order to
insurance calling to find out the reason for rejection. Based on the feedback
corrective actions are taken. One example, Blue choice (New York) rejected a lot
of claims for the reason ‘Invalid or missing modifier’. Carrier was called and it was
found that they do not require modifiers henceforth and claims need to be billed
without modifiers.
Issue: Pre-existing Condition
Action:
Pre-existing condition refers to the terms & conditions entered into between the
carrier and the patient / subscriber before the beginning of the contract. The
rejection will usually say that the claim is being denied due to the pre-existing
condition. It would not specify what exactly the condition is. So carrier needs to be
called to find out the pre-existing condition. Preexisting condition may be for
anything. (Ex.) A) There may be a condition that for the first $5000 worth of
medical expenses the patient should bear it himself and the carrier would start
paying for expenses after crossing that limit. If the patient has not yet exhausted
the threshold limit then the claim would be denied for the pre-existing condition.
B) There may be a condition that the carrier would not be paying for the same
diagnosis more than once in a year. If a same diagnosis code is used on two
occasions in the same year then the carrier will deny the claim submitted for the
second time stating ‘pre-existing condition.
As soon as you receive the denial, work order can be issued to Insurance calling.
Check with insurance on the preexisting condition.

If the patient has secondary coverage: Check whether we can send the entire bill
to secondary along with the primary denial. Some carriers may be willing to pay
for the same. If the secondary agrees, bill the secondary along with the denial
obtained from the primary.
If the patient has no Secondary Coverage / Secondary refuses to pay:

Flip the balance to patient.
Issue: Authorization number required or Invalid
Action:
Some carriers insist on obtaining prior authorization from them before the surgery.
This may be for certain specific procedures or may even be for all procedures. So
these are carrier specific and procedure specific. Please note that it is the
responsibility of the Surgeon (and not the patient) to obtain the authorization#
from the carrier. When you get a denial from the carrier for this reason, give work
order to surgeon calling and find out if the surgeon has been paid.
If the surgeon has been paid: It is unlikely that a surgeon would have got paid.
But if he has got payment, then call carrier and find out why they have denied the
anesthesiologist claim when the surgeon has been paid. They will either reprocess
the claim or request a refund from the surgeon.
If surgeon has not been paid: Take a write off. You cannot flip the balance to the
patient.
Issue: Anesthesia time not on claim
Action:
For anesthesia claims it is mandatory to have time printed on the claim. This rule
is not applicable for flat fee codes. But we have got quite few denials from the
carriers who wanted anesthesia time even for flat fee codes. So wherever
anesthesia time is available the same should be noted for claims with flat fee
codes.
There is one more reason for this denial. If there are more than 4 line items in a
balance then the anesthesia time would not get printed on the same claim form
but in another. The carrier will treat the two forms separately and deny one for
incomplete information and the other for want of anesthesia time. This should be
avoided. Whenever you find a denial for this reason take the HCFA(s), staple them
and send the same along with a covering letter.

Issue: Anesthesia Records / Op. Notes / Medical Necessity records
required
Action:
Anesthesia, records are usually requested by W/c (Workmen compensation)

carriers for processing of claims.
When a carrier requires operative / surgeon notes:
a) Give a work order to insurance calling to find out if they have paid for the
surgeon’s claim. If they have paid for the same, then the same has to be pointed
out since they have processed the surgeon’s claim, why would they require
surgeon notes once again for processing the claims? This line of argument can be
pursued and the claim processed.
b) If the carrier has not (yet) paid for the surgeon’s claim, then the surgeon needs
to be called for a copy of the surgeon / operative notes. It should be noted that
surgeon notes is a confidential document (i.e.) the request should be
substantiated with valid reason.
c) MAC B Cases: MAC stands for Monitored Anesthesia care. Certain Medicare
(Texas, Ohio, Alabama etc.) requires ‘Medical Necessity’ report for processing MAC
category ‘B’ procedure codes. This report needs to be signed by the surgeon.
Whenever we receive charge sheets with MAC B procedure codes for MCR in
‘affected sites’ (states which require Medical Necessity letters) then the medical
necessity letter for the same should be obtained from the doctor’s office. Once it is
received claim should be resubmitted along with the letter.
Issue: Exceeded the normal time for filing limit
Action: Every carrier has a filing limit within which you have to submit a claim.
This filing limit is calculated from the date of service and not from the filing date or
the date the claim is sent out. When a carrier rejects the claim for this reason
check whether the claim was submitted in the first instance with in the filing limit.
If yes, then the claim has to be appealed with proof of timely submission. The
proof that is accepted by carriers for timely submission is ‘c’ (carrier confirmation)
reports and rejected EOB’s. When no other proof is available send the patient
ledger copy as proof. Not many carriers accept patient ledger copies as sufficient
evidence for timely submission. But it is worth trying in absence of other
documents.
If no, find out why the claim was not submitted with in the filing limit. Even If the
provider has no identification number issued by the carrier, the normal practice is
to submit the claim to the carrier and get a denial so that the same will serve as a
proof of timely submission. So if you identify that the claim has not been
submitted at all in time highlight the issue immediately.

Issue: Require W9 form
Action: A carrier may require a W9 form in the following circumstances:
The tax id# on the claim form differs from what is in the carrier’s record.
The ‘pay-to-address on the claim form differs from carrier’s records.
Some carriers update the details about provider (like tax id#, pay-to-address)
every year. For this reason they will ask for the W9 forms. When W9 form is
requested for the above reasons, fill the same carefully and properly and send it to
the carrier. Always remember that W9 forms should not be sent to Medicare and
Medicaid. Certain BCBS plans and other carriers accept W9 forms.

SAMPLE W9 FORM

What is the process of AR analysis?
Step one: Report Execution
At the beginning of each month AR analyst runs an Aged Insurance Report on
billing system using required parameters and identifies claims that are unpaid or
inappropriately paid. This report provides a list of outstanding claims pending
against each insurance carrier.
Step two: Identification of Accounts to be worked
From the above report, the analyst selects claims that remain unpaid beyond 30-
45 days from the date of filing. The number of days depend on whether the claims
were sent on paper (paper claims) or were transmitted electronically (electronic
claims). The number of days depends on the average turnaround time for the
claims to get settled, i.e., from the date of filing of the claim to the date of receipt
of payment for the claim.
Step three: Identification of the problem - Review
The analyst then reviews patient account ledgers pertaining to the unpaid claims
to analyze why the claims are still outstanding. Analyst reviews patient ledger
from all billing angle for possible violation of billing rule.

Following are some of the situations the analyst may encounter & suggested
remedial actions:
(a) If the analyst detects a charge entry, cash posting or claim submission error,
he/she informs the concerned department. The error is corrected and claim
resubmitted, if necessary.
(b) If the claim has been prepared and submitted correctly according to known
rules and guidelines, and the usual turnaround time has passed, the analyst
either calls insurance carrier or requests AR caller to call insurance carrier. A
note is also made to AR caller indicating the type of information that needs to
be obtained from representatives of the insurance company or payer.
(c) When claims are underpaid or denied, the analyst establishes the reasons for
the denial or low payment by reviewing the explanations of benefits pertaining
to the claim, carrier rejection reports, carrier billing guidelines, or initiating a
work order to AR Calling to seek clarifications from the insurance company.
Claim denials or underpayments due to billing errors committed by staff are
segregated and the concerned staff instructed to take corrective action.
(d) When claims are denied due to lack of documentation or additional information,
the analyst requests for such additional documentation from the provider or
billing office, and follows up with the insurance through the AR callers.

(e) When the analyst is dissatisfied with the adjudication of a claim he/she may
appeal with insurance for a review, with supporting documentation obtained
from the provider office. The analyst will have to follow the appeals process
and if there is a telephonic appeal facility, analyst should explore the same to
appeal. A copy of the patient ledger and copies of the relevant EOB should be
available with analyst while executing telephonic appeal.
If there is no telephonic appeal facility, then the analyst must an appeal on
paper following the insurance company’s appeals process.
Step Four: Identification of the problem – Calling
If the claim has been prepared and submitted correctly as per insurance
requirements, and usual turnaround time has passed, call needs to be placed with
respective insurance carriers to ascertain the status of outstanding claim.
Analyst or AR Caller obtains the required information from the insurance company
and documents the results of the call in the patient notes section of patient
account. Appropriate steps needs to be initiated to settle outstanding claims based
on the call notes.
Examples of the kind of situations that the analyst may come across and the
action initiated are given below:

(a) The AR night caller may have documented in patient notes that according to
the insurance representatives the claim is not in their system, meaning they
don’t have a record of the claim. The AR analyst may now check the claim
address and review transmission reports to find out if the claim failed to reach
the carrier due to a bad address or a transmission error. If the address in the
system is incorrect, the analyst first finds out the number of claims that have
been affected due to the wrong address. Or if there was a transmission error,
how many claims were affected.
(b) Caller patient notes reveal that claims have been denied. Then analyst initiates
appropriate action based on the reason for denial as documented in patient
notes.
(c) The insurance carrier may state that the claim has been settled. In such cases,
the AR caller obtains the payment date and checks details from the carrier and
documents them in patient notes. The analyst follows up with the cash
department on whether such a payment has been received. If the check the
carrier says has been issued has not been received and posted within two
weeks from the day of payment, he/she may prepare a report (depending on
the policy established by the client) on such missing checks and sends it to the
client.
(d) An issue may need feedback from client for proper resolution. If so, the analyst
sends a report to the client detailing the issue and seeking clarifications.

Step Five: Identification and Execution of Corrective
Action
Once issues or problems have been identified the AR analyst initiates action to resolve
them. Issues may be forwarded to one or more departments, or to the client,
depending on the nature of the issue. Complete resolution of an issue may require
inputs or actions from more than one department.
Analysts issue forward’s request to the concerned departments for issue resolution.
Issues that require inputs or actions from the client are forwarded to the client. For
instance,
• To clarify claim issues, check on status of claims or obtain carrier billing
information, the analyst issues work orders to AR Callers.
• A corrected claim that must be resubmitted is forwarded to the claims
department.
• Write-offs, adjustments and actions to resolve overpayments requests are
initiated to the cash department, while charge entry errors are corrected by the
charge department.
Step Six: Identification of Uncollectible AR
Details of outstanding claim balances that the analyst considers uncollectible, and
which may thus have to be written-off, are forwarded to the client for decision
making. Details of outstanding claims, where collections efforts have fail due to non-

cooperation or lack of response from payers or liable parties, are also forwarded to
the client. Such accounts may be moved to a collection account. A collection agency
then resumes the collection activity.
What are the tools used by an AR Analyst in Claim Analysis Process?
AR analysts uses the following tools, reports and documents to identify and
investigate issues that are affecting cash flow and preventing timely and accurate
reimbursement of claims by payers. One or more, and sometimes all, of the
following tools, source documents and resources are required for complete and
effective AR analysis:
Patient Account Ledger
• Explanation of Benefits (EOB)
• Regular Mail or Correspondences
• AR calling
System Reports like

1. AR Reports
2. Custom Reports
3. Financial Reports
4. Electronic Transmission Reports
The extent to which the above mentioned tools and resources are used will depend on
the account receivables situation in the accounts. The AR analyst measures the
success of collection efforts by computing the current and past AR and collection’s in
the specialty and account he/she is handling, comparing it against industry standards,
wherever available. The analyst investigates the reasons for any rise in AR or any fall

in collections using the tools and documents mentioned above. The objective is to
minimize AR and maximize the collection rate.
Information Needed for Assessment of Accounts

Receivable
To perform the most basic assessment of A/R, the following three pieces of
information are necessary,
• Monthly Charges
• Monthly Receipts
• Total A/R at the end of the month.
Monthly Charges
The charges for the month are the total amount of fees charged for patient
care from the first working day through the last working day of the month,
whether or not they have been paid. Charges for services that fall outside
regular medical care should not be included. If you have been asked to testify
as an expert witness and have just billed the defense attorney for $3,000, that
is a charge and will undoubtedly produce income to you or the practice, but it
should be considered outside income and for the purpose of analysis should
not be included in the A/R.
Monthly Receipts

The second piece of required information is the total receipts for the month:
the dollars collected for the medical care that was rendered. A receipt must
correlate with a charge that was entered for the current month or in a prior
month.
Month’s-End Accounts Receivable
The third category of information needed to analyze a practice is the total A/R
at the end of the month: the total balance that is due to the practice on the
last day of the month for patient care. In reality, the total A/R should be the
amount of money that can actually be collected eventually. Some factors can
over inflate this figure, such as failure to write off balances that are
uncollectible. This could involve care for a homeless person who was not
eligible for Medicaid or simply a regulatory balance (the amount disallowed by
Medicare in accepting an assignment). Another way A/R can be inflated is by
keeping accounts on A/R sent to a collection agency. By turning them over to
a collection agency, the practice has classified these accounts as “bad debt”.
For the convenience of posting collection agency payments, many practices fail
to write off these balances or subtract them from the total A/R. To perform a
true analysis, it is essential that the A/R figure reflect the total money owed
the practice, which the practice plans to collect.

If one of these three pieces of information cannot be obtained without a lot of
effort, the practice faces a significant challenge because this information is
basic and, if missing, indicates a lack of receivables management.
Accounts Receivable Assessment
Once a practice has obtained the total monthly charges and receipts and the
total A/R at the end of the month, it can begin assessing the state of it’s A/R.
There are three methods of assessing an A/R: days outstanding, A/R ratios,
and aged A/R.
Days Outstanding
Days outstanding, or the average number of days it takes for a typical charge
to be paid, are the method of accountability most commonly used by
hospitals, and the same principles are applicable to a physician practice.
There are many ways to figure days outstanding. The simplest method is the
following,
1. Take the accounts receivable of the practice on the first day of the month.
2. Add to it the A/R of the practice on the last day of the month and divide by
two. This gives you an average of the A/R for the month.
3. Divide this figure by the month’s receipts and then multiply it by the
number of days in the month.
The resulting figure gives you the average number of days a receivable is
outstanding, or the days outstanding, for that month.
For example, the equation below shows a practice whose A/R on January 1st
was $95,000. On January 31st A/R was $105,00, and the receipts for the
month of January were $28,000. Then A/R outstanding days is calculated as
below,
95,000+105,000 = 200,000/2 = 100,000/28,000 = 3.57 X 31 = 110.7
The average account is 111 days outstanding.
The optimal range of days outstanding is 45 to 60 days. Normally this can be
achieved only in a setting where accepting the payment at the time of service
is commonplace. For a hospital-based practice such as radiology or anesthesia
practice, 60 to 90 days outstanding is not a sterling example of receivable
management but is considered acceptable. The real danger zone, whether the
practice is hospital-based or not, occurs in practices in which the numbers
exceed 120 days unless there is a reasonable explanation, such as a high
percentage of Medicaid accounts. As a rule of thumb, any practice with 150
days or more outstanding faces a significant challenge.
Accounts Receivables Ratio

Another method for evaluating a practice involves the use of A/R ratios. These
ratios indicate how total A/R relates to a practice’s payments and charges.
Accounts Receivable to Receipts Ratio
To find out how quickly your average account is being paid, simply do the
following: Take the total A/R on the last day of the month and divide it by the
total payments received during that month. This should produce a number
ranging from 2.5 to 4. If the number is 5 or more, you are looking at 150
days (5 X 30 days) from the time when a charge is entered on the books until
the time when it is collected.
For example, if a practice has an A/R of $100,000 on January 31st and total
receipts for the month are $30,000, the ratio of A/R to payment is 3.3,
meaning that it takes an average of 3.3 months, or approximately 100 days,
for a charge to be paid ( see the equation below).
$100,000 / $30,000 = 3.3
3.3 X 30 days = 100 days on average for an account to be paid.
Accounts Receivable to Charges Ratio
It is possible to monitor a practice by keeping track of how the A/R relates to
the practice’s charges. Simply divide the A/R at the end of a given month by
the charges entered during that month.

For example, a practice with an A/R of $100,00 on January 31st and $25,000
worth of charges that month has an A/R to charges ratio of 4:
$100,000 / $25,000 = 4
This number should be fairly consistent from month to month if there is good
A/R management. It also should be somewhat similar to the A/R to receipts
ratio. If the numbers vary dramatically, this may indicate that the practice is
influenced by seasonal changes, as in the case of an orthopedic surgeon
practicing near a ski resort. In the winter the surgeon’s A/R to charges ratio
may by lower than it is in the summer, when there aren’t as many broken
bones. Of course the A/R to receipts ratio also would be affected. Again, any
number above 5 justifies a serious look at the practice’s economic health.

Duties and Responsibilities
A Charge Entry person
The following are the duties and responsibilities of a charge entry person:
He/ She should
a) Be aware of all billing rules for his/ her specialty and updates himself/
herself on the latest.
b) Ensure that the daily targets of production required of him/ her are met
without with he/ she should not leave for the day unless there is nothing
left to enter.
c) Ensure 100% accuracy of data entered. For this purpose they should
take a patient face sheet/ charge summary and completely check the data
entered with the demographics/superbills.
d) Ensure that proper folders are maintained and are in proper condition
and easily retrievable for the charges received and entered. These folders
should be properly numbered and a log of all the folders should be
maintained separately.
e) Forward the charge files for audit immediately after completion. He/ She
should also ensure that the files are returned by audit properly and
corrections are carried out immediately.
f) Ensure that any pending demographics or charges on account of any
information which is missing or not clear should be promptly maintained in

an excel spreadsheet and should be forwarded to the client on a daily basis.
In case any of the missing or unclear information could be cleared through
AR calling, such details should be placed in a folder for AR calling and
notified to them properly. It should also be ensured that this is being
constantly followed upon to ensure that the issue is cleared.
g) Ensure that all e-mails from either the client or from within the group or
from the call center should be attended to and replied on the same day.
h) Ensure that the pending list is reviewed every week and any items which
could be cleared at our end be promptly done.
i) Ensure that any special reports required by the client or from the account
manager be prepared immediately on request or a proper time frame of the
earliest when it can be completed be notified immediately.
j) Ensure that all charge files are received in time without any delay or with
minimum acceptable delay (transit period between client and Madras). If
there any such delays, this should be properly recorded and notified to the
client. Also if files are not received for a particular DOS but received for
subsequent date of service, then it should be questioned to the client.

A Cash Poster
The following are the duties and responsibilities of a cash poster.
He/ She should
a) Be aware of all billing rules for his/ her specialty and updates himself/
herself on the latest.
b) Ensure that the daily targets of production required of him/ her are met
without with he/ she should not leave for the day unless there is nothing
left to post.
c) Ensure 100% accuracy of data entered. For this purpose they should
take a receipt summary/ unposted summary/ cash reconciliation and
completely check the data entered with the checks and EOBs.
d) Ensure that proper folders are maintained and are in proper condition
and easily retrievable for the cash received and posted. These folders
should be properly numbered and a log of all the folders should be
maintained separately.
e) Forward the cash files for audit immediately after completion. He/ She
should also ensure that the files are returned by audit properly and
corrections are carried out immediately.
f) Ensure that the unposted list is reviewed immediately after completion of
posting the cash files and the following are identified: Patient Not Found,
Not-Our-DOS, Insurance Refunds, Patient Refunds, Others. The Patient Not
Found & Not-Our-DOS cases should be properly documented in an excel

spreadsheet, copies of checks and EOBs taken and forwarded on a
periodically basis to the client office. The refund requests should be
initiated and approved by the manager and forwarded to the client office
periodically.
g) Ensure that the bank reconciliation, if your specialty/ client is required to
do so, is done every month and any discrepancies notified to the client.
h) Ensure that small balances if any are written off promptly and
periodically.
i) Keep their eyes open of any changes in EOBs and notify the AR analyst
immediately. For instance, there may be changes in provider #s or changes
in the pay-to address or any important information, which needs to be
acted upon immediately. These are very vital information and need
constant monitoring and action.
j) Ensure that all cash deposit files are received in time without any delay
or with minimum acceptable delay (transit period between client and
Madras). If there any such delays, this should be properly recorded and
notified to the client. Also if files are not received for a particular deposit
but received for subsequent date of deposits, then it should be
questioned to the client.
k) Ensure that any special reports required by the client or from the
account manager be prepared immediately on request or a proper time
frame of the earliest when it can be completed be notified immediately.

A Regular Mail Person
A Regular Mail Person is one who takes care of regular mails i.e. entering
the regular mails into the system and taking action on each one of them.
This function can be separate or can be attached to one of the other
functions. The following are the duties and responsibilities of a regular mail
person. He/ She should
a) Ensure that all the regular mails received are entered in the system the
same day.
b) Be aware of all the billing rules for his/ her specialty.
c) Ensure that action on all regular mails received is taken on the same day
on which it is entered.
d) Keep their eyes open on any important announcements in the regular
mails received. Sometimes certain changes in rules and regulations of
certain carriers are received in regular mails. These should be made note of
and appropriate changes in billing rules should be made.
e) Be aware that any denial or information received for a single claim, if it
applies to all claims for that insurance carrier, should be applied to all
claims for that insurance carrier and action taken accordingly. This is called
the global rule.
f) Also keep watch on the rejections in electronic transmission, review such
rejections and along with the AR analyst find out why such rejections occur
and what can be done to prevent these rejections.

An AR Analyst
An AR Analyst is an important person in the group. He is the one who
guides the group by providing lot of inputs in the form of rules and other
clarifications. He is the person who reviews the Accounts Receivable and
keeps it in control and ensures the billing office meets its objective. The
following are the duties and responsibilities of an AR analyst. He/ She
should
a) Be aware of all the billing rules for his/ her specialty and updates
himself/herself on the latest.
b) Sets realistic collection targets every month for his/ her specialty.
c) Work towards that target by monitoring collections every week of that
month.
d) Ensure that proper rules are set such that clean claims go in the first
place rather than receiving denials and acting on them.
e) Coordinate with the charge and cash person to ensure that rules are
followed.
f) Ensure that his/ her production target of the number of accounts
reviewed should be maintained at an acceptable level.
g) Ensure that adequate and quality work-orders are given to the night
crew for accounts that require follow up.

h) Ensure that all accounts called during the previous day are reviewed
completely and action taken immediately. If global rule is applicable, then it
should be applied appropriately.
i) Ensure that all denials received have been acted upon and global rules,
where applicable, are taken care promptly.
j) Ensure that overall AR days for the account meet industry standards is
around 70 days whichever is lower.
k) Periodically take reports to ensure that AR days, outstanding AR for each
patient type/insurance is well within control and as per standards.
l) Ensure that proper explanation by carrier/ patient type is available with
supporting documentation to prove in case the AR days go above 70.
m) Co-ordinate with the call center people and solve problems.
n) Constantly keep track of electronic and paper claims and keep his/ her
eyes open for any major rejections and ensure that all electronic rejections
are taken care promptly.
o) Keep his/ her eyes open for EOBs where the pay-to address is different
from that of the account’s.
p) Work towards ensuring that claims for majority of the carriers go
electronically.
q) Ensure that any special reports required by the client or from the
account manager be prepared immediately on request or a proper time
frame of the earliest when it can be completed be notified immediately.

HOW TO COMPLETE THE CMS-1500
The CMS-1500 is used by physicians, durable medical equipment suppliers, and

other providers to bill Medicare, Medicaid, CHAMPUS, VACHAMPUS, Group Health
Plan, FECA Black Lung, or other type of insurance. In rare instances, some
insurance companies may request free-standing clinics and hospitals to submit
charges with the CMS-1500 form.
All providers, including nephrologists and oncologists, billing with the CMS-1500
must provide specific information about the patient, the patient's insurance, and
about themselves as service providers. The service provided is described by
revenue codes, revenue code descriptions, and HCPC. The number of services
rendered and the charge for these services depends on the facility's charge
master.

Sample CMS 1500 form

APPENDIX B: ABBREVIATIONS
AMA – American Medical Association

BLK Lung – Black Lung
CCYY – Year, indicates entry of four digits for the century (CC) and year (YY)
CHAMPUS – Civilian Health and Medical Program of the Uniformed Services
CHAMPVA – Civilian Health and Medical Program of the Department of Veterans
Affairs
CLIA – Clinical Laboratory Improvement Amendments
CMS – Centers for Medicare & Medicaid Services, formerly HCFA
COB – Coordination of Benefits
CPT® – Current Procedural Terminology, 4th Edition
DD – Day, indicates entry of two digits for the day
DME – Durable Medical Equipment
EIN – Employer Identification Number
EMG – Emergency
EPSDT – Early & Periodic Screening, Diagnosis, and Treatment
F – Female
FECA – Federal Employees’ Compensation Act
GTIN – Global Trade Item Number
HCFA – Health Care Financing Administration, currently CMS
HCPCS – HCFA Common Procedural Coding System
HIBCC – Health Industry Business Communications Council
HIPAA – Health Insurance Portability and Accountability Act of 1996
HMO – Health Maintenance Organization
ICD-9-CM – Internal Classification of Disease - Revision 9 - Clinical Modification
I.D. or ID. – Identification
ID # or ID. # – Identification Number
INFO – Information
LMP – Last Menstrual Period
M – Male
MM – Month, indicates entry of two digits for the month
NDC – National Drug Codes
No. – Number
NUCC – National Uniform Claim Committee
NUCC-DS – National Uniform Claim Committee Data Set
NPI – National Provider Identifier
OMB – Office of Management and Budget
OZ – Product number Health Care Uniform Code Council
PH # – Phone Number
QUAL. – Qualifier
REF. – Reference
SOF – Signature on File
SSN – Social Security Number
UPC – Universal Product Code
UPIN – Unique Physician Identification Number
USIN – Unique Supplier Identification Number
VP – Vendor Product Number
YY – Year, indicates entry of two digits for the year; may also be noted as CCYY, which
allows for entry of four digits for the century (CC) and year (YY)
HOW TO COMPLETE THE UB – 92
The UB-92 is the form accepted by CMS for hospitals and free-standing clinics to
use when billing Medicare Fiscal Intermediaries (FI). UB-92 forms can be
submitted either electronically or on paper ("hard copy"). The UB-92 was adopted
in 1992 to replace the UB-82.
Providers billing with the UB-92 must supply specific information about the
patient, the patient's insurance, and about themselves as service providers. The
service provided is described by revenue codes, revenue code descriptions, and
HCPC. The number of services rendered and the charge for these services depends
on the facility's charge master.
The following table lists instructions for completing a UB-92 form. Bill fields are
also known as locator or location codes.
Locator or
Location Instruction
Code
1 Enter the provider's name, address, and telephone number.
2 Leave blank.
Enter the Patient Control Number, which is not required by Medicare but can
3
be used by providers for internal patient identification.
Enter the appropriate three-digit code.
• First digit—describes your facility type

• Second digit—describes your facility sub-type
4 Third digit—"1" (admit through discharge claim, encompassing entire

services provided for that service period) or "5" (late charge only for stand-
alone late charges omitted from initial bill) or "7" (to designate that this
claim replaces a previously submitted claim) or "8" (cancel the entire prior
claim). Centers submitting a claim with an "8" as the final digit
should indicate why this form is being submitted (ie, duplicate
claim) in the Remarks section (location 84).
5 Enter the Federal Tax ID Number for the service provider.
Enter the beginning and ending dates of service.

For hard copy claims use the format mmddccyy.
For electronic claims use the format ccyymmdd.
6
Most statements span a 30- or 31-day period. If there is a break in service
days, such as for an inpatient hospitalization, then contact your FI to
determine how to designate this on the UB-92 form .
7–11 Leave blank.

Enter the patient's name as it appears on his or her Medicare card (last
12
name, first name, middle initial).
Enter the patient's full mailing address (including street name, city, state,
13
and ZIP code).
Enter the patient's date of birth.

14 For hard copy claims use the format mmddccyy.
For electronic claims use the format ccyymmdd.
15 Enter the patient's sex ("M" for male or "F" for female).
16 Leave blank.
17 Enter the patient's admission date.
18–22 Leave blank.
23 Enter the medical record number.
24–30 Enter the condition codes if applicable.
31 Leave blank.
Check with your intermediary to verify the format for admissions or other
breaks in service.
If the patient is within his or her 30-month coordination period, enter "33" in
32–36
one of these fields.
If there is a break in service, such as an admission, enter a date in locator

36 and enter code "74" in the code section.
37 Leave blank.
38 Leave blank.
Enter the appropriate code and amount for certain services such as blood
39–41
and blood products.
Enter the appropriate Revenue Code. Revenue Codes are based on type of
service provided and billed for.
42
Insert appropriate Revenue Code.
Enter the Revenue Code narrative description to match the code in locator
42.
43
Insert appropriate description.
44 Enter Healthcare Common Procedural Coding System (HCPCS). The

Healthcare Common Procedural Codes (HCPC) for certain services are set
locally by the Fiscal Intermediary; check with your intermediary for specific
information.

Insert appropriate HCPC code.
45 Leave blank.
Enter the units of service.

46
Furthermore, most FIs may reimburse an additional $0.50 for the supplies.
Enter total charges. For hard copy claims enter "Revenue Code 001" to
47
designate the total charges for that claim.
48 Leave blank.
49 Leave blank.
50 Enter up to three payers: "A" "B" and "C."
51 Enter the provider number.
Enter up to three individuals who are responsible for insurance coverage:

58
"A" "B" and "C."
59 Enter the patient's relationship to the insured: "A" "B" and "C."
Enter the Certificate/Social Security Number/HI Claim/Identification number

60
for "A" "B" and "C."
61 Enter the group name.
62 Enter the group identification number.
63 Leave blank.
64 Leave blank.
65 Leave blank.
66 Leave blank.
Enter the Primary Diagnosis Code.

67 All ICD-9-CM codes should correspond to the medical documentation in the
patient's chart.
Enter the Secondary Diagnosis Code.

68–75 All ICD-9-CM codes should correspond to the medical documentation in the
patient's chart.
82 Enter the attending physician's UPIN.
83 Leave blank.

84 Enter remarks required by your FI.
85 Have the provider representative sign and date this locator.

Sample UB - 92 form

HIPAA
The purpose of this document is to assist Medical Billing personnel to understand
and plan for the implementation of the HIPAA requirements. The personnel must
familiarize themselves with the final HIPAA rules

What is HIPAA?
HIPAA is the federal Health Insurance Portability and Accountability Act of 1996.
The primary goal of the law was to make it easier for people to keep
health insurance, protect the confidentiality and security of healthcare
information, and help the healthcare industry control administrative costs.
HIPAA is divided into five titles or sections. Each title addresses a unique
aspect of health insurance reform.
Title I is portability and it has been fully implemented. Portability allows
individuals to carry their health insurance from one job to another so that they do
not have a lapse in coverage. It also restricts health plans from requiring pre-
existing conditions on individuals who switch from one health plan to another.
Title II is called Administrative Simplification and it will have the greatest impact
on providers. It is designed to:
+ Combat health care fraud and abuse;
+ Guarantee security and privacy of health information;
+ Establish standards for health information and transactions; and
+ Reduce the cost of health care by standardizing the way the industry
communicates information.

The remaining titles are:
+ Title III – Tax-Related Health Provisions
+ Title IV – Application and Enforcement of Group Health Plan Requirements

What is administrative
+ Title V – Revenue Offsets
simplification?
Administrative Simplification is the establishment of a set of
standards for receiving, transmitting and maintaining healthcare
information and ensuring the privacy and security of individual
identifiable information. HIPAA establishes standards for electronic health care
transactions, national code sets, and unique identifiers for providers, health plans,
employers and individuals.
The HIPAA electronic data requirements are meant to encourage the healthcare
industry to move the handling and transmission of patient information from
manual to electronic systems in order to improve security, lower costs, and lower
the error rate.
Standardization has been very effective in
many industries. Anywhere in America you can plug in
a US manufactured toaster and it will work because a
standard voltage was established for small
appliances. However, if you take the toaster to Poland, it will only work if you use
a special converter. If you go to Sudan you will have to use still another

converter. The electronic claims process in the United States is like the worldwide
electric industry, no standardization. When administrative simplification has been
implemented, providers will be able to submit an electronic claim in the same
format to any healthcare plan.
Transaction and Code Sets: HIPAA mandates the development and use of
standardized transactions for the electronic exchange of data. In addition, the use
of standardized national codes sets to identify medical conditions, treatments,
providers, individuals, and procedures are required.
Implementation Guides for HIPAA Standard Transactions are defined and
numbered as follows:
• Health care claims or coordination of benefits - Transaction Code 837
• Payment & remittance advice - Transaction code 835
• Health claim status - Transaction code 276/277
• Plan enrollment – Transaction code 834
• Plan eligibility – Transaction code 270/271

+ Privacy: Provides for the protection of individually identifiable health
information that is transmitted or maintained in any form or medium.
The privacy rule will affect the day-to-day business operations of all
organizations that provide medical care and maintain personal health
information.
+ Security Standards: Security Standards are designed to protect
health care information as it is being stored and exchanged. It
also includes provisions to verify the identity of those sending and
receiving health care information electronically. The security rule
has not been finalized; however, some of the security standards will be
implemented as part of the privacy rule.

The HIPAA legislation does not require providers to discontinue submitting paper
claims. However, HIPAA may require changes to several aspects of paper billing,
such as changes to codes and required data elements.
HIPAA requires the following entities to comply:
+ Health Care Providers: Any provider of medical or other health services, who
bills or is paid for healthcare in the normal course of business. Health care
includes preventive, diagnostic, therapeutic, rehabilitative, maintenance, or
palliative care, and counseling, service, assessment, or procedure with respect
to the physical or mental condition, or functional status of an individual.
+ Health Care Clearinghouse: Entities that process or facilitate the processing of
health information received from other entities. It includes groups such as
physician and hospital billing services.
+ Health Plans: Includes individual or group plans that provide or pay the cost of
medical care and includes both the Medicare and Medicaid programs
Providers will be required to:
+ Guarantee patient privacy rights by:
• Giving patients clear, written explanations of how the provider may
use and disclose their health information;
• Ensuring patients can see and get copies of their records, and request
amendments;
• Making a history of non-routine disclosures accessible to patients;

• Obtaining patient consent before sharing their information for
treatment, payment, and health care operations;
1. Obtaining patient authorization for non-routine disclosures and most
non-health care purposes; and,
2. Allowing patients to request restrictions on the uses and disclosures of
their information.
+ Adopt written privacy procedures, to include:
3. Who has access to protected information,
4. How it will be used within the agency, and
5. When the information may be disclosed;
+ Ensure that business associates protect the privacy of health
information;
+ Train employees in the provider’s privacy procedures; and,
+ Designate a privacy officer who is responsible for ensuring the privacy
procedures are followed.
+ Assess impact of Transaction Code sets:
Evaluate current business processes to determine what needs to be done to
ensure timely compliance. Specific attention should be addressed to:
• How claims are submitted
• How patient records are maintained, released and communicated
• How patient consent and authorization forms are maintained
• How referrals are given or received

+ Assigned Security Responsibility:
The rule requires providers to assign security responsibility to a specific individual
or organization and document that assignment. This responsibility includes the
management and supervision of:
1. The use of security measures to protect data, and
2. The conduct of personnel in relation to the protection of data.
This assignment is important to provide organizational focus, indicate the
importance of security and pinpoint responsibility.
+ Media Controls:
The Billing office must develop formal, documented policies and procedures that
govern the receipt and removal of hardware and software (such as diskettes,
tapes, and computers). These policies are important to ensure that media
containing personal health information is protected and that those persons who
are responsible for hardware/software maintenance are aware of their
responsibilities under HIPAA. These controls include the following mandatory
implementation features:
• Controlled access to media
• Accountability (tracking mechanism)
• Data backup
• Data storage
• Disposal

+ Physical Access Controls:
The Billing Company must document formal policies and procedures for limiting
physical access, while ensuring that properly authorized personnel can work
freely. These controls include the following mandatory implementation features:
• Disaster recovery
• Emergency mode operation
• Equipment control (in and out of facility)
• A facility security plan
• Procedures for verifying access authorizations prior to physical access
• Maintenance records
• Need-to-know procedures for personnel access
• Sign-in for visitors and escorts, if appropriate
• Testing and revision
+ Policy/Guidelines on Workstation Use:
The organization must have a policy on workstation use. These documented
instructions must delineate the proper functions to be performed. This is crucial
so that employees understand the manner in which workstations must be used to
maximize the security of health information.
• Accreditation
– Accrediting organizations may require compliance in future
- HHS has the final responsibility for determining civil violations
and imposing penalties

• Civil money penalties
– $100 for each violation of a standard
– Maximum of $25,000 per year
- Per identical requirement or prohibition
For each offense of
• Wrongful disclosures
– Fined not more than $50,000
– Imprisoned not more than one year
• False pretenses
– Imprisoned not more than 5 years
• Intent to sell, transfer or use
– Imprisoned not more than 10 years

Medical Billing Terminologies
COBRA: Consolidated Omnibus Budget Reconciliation Act. It is that if an employee
is registered under this Act he/she will be covered by the employer in case of any
accidents even after the employee retires or resigns the job. The coverage period
will last up to 16 months from the date of retirement/resignation.
OBRA: Omnibus Budget Reconciliation Act. It is special laws that if an employee
registers himself under this act it allows him/her to get the health insurance
coverage benefits even after COBRA for a period of 11 months.
This will come into place only if the patient is suffering from any disabilities.
Roster Billing: It is the process of billing multiple patients A/c's in one single
claim for the same TOS (Type of Service) rendered irrespective of the DOS (Date
of Service).
Capitation: It is a specified amount paid periodically to the provider for a group
of specified health services, regardless of quantity rendered. This is a method of
payment in which the provider is paid a fixed amount for each person served no
matter what the actual number or nature of services delivered.
Euthanasia: This is nothing but Mercy Killing which means for E.g.: If someone is
in a Coma state the doctor takes the initiative of killing him rather than him being
alive and suffers.

Bench Marks: Since the term Bench marks was discussed and no body could
come to a conclusion it was discussed that every individual would search the net
and come to a conclusion about what it is and discuss it on Monday.
Medicare Benefits exhausted: When a person takes a treatment for more than
the prescribed limit (For E.g.: Mammogram can be taken only once in a year, if
taken for more than once in a year in that case Medicare would deny stating as
“Mcr benefits exhausted”) Medicare would deny it.
Julian Date: Regardless of the month, it is 1-365 days in a year. It flows
periodically (For E.g: After Jan 31st Feb 1st would be considered as 32 and it
continuous in the same manner for the coming days). This is used for creating
batch numbers irrespective of the department.
Reciprocal Billing: A reciprocal billing arrangement may exist when the patient’s
regular physician submits a claim for a covered visit which the regular physician
arranges to be provided by a substitute physician on an occasional reciprocal
basis. The requirements for reciprocal billing arrangements are as follows:
• The regular physician is unavailable to provide the visit service;
• The Medicare patient has arranged or seeks to receive the visit
services from the regular physician;
• The substitute physician does not provide the visit services to a
Medicare patient over a continuous period of longer than 60 days; and

• The regular physician identifies the services as substitute physician
services meeting the requirements by adding modifier Q5 (services
furnished by a substitute physician under a reciprocal billing
arrangement) at the end of the procedure.
Under a reciprocal billing arrangement, there is no mention of the
regular doctor paying the substitute physician. There is no need for a
employer/employee relationship to exist. It is more like an arrangement
of "I’ll cover for you, and you cover for me," (on an occasional basis).
The substitute physician in a reciprocal billing arrangement usually has a
practice of his/her own and is properly enrolled as a Medicare provider.
FROI: First report of Injury/illness, the employer has to send this report to
Worker's compensation.
HPSA: Healthcare provider service shortage areas. It may have shortages of
primary medical care, dental or mental health providers and may be urban or rural
areas, population groups or medical or other public facilities. Health Professional
Shortage Area (HPSA) bonuses are a 10 percent incentive payment that is paid to
physicians only when their services are covered by Medicare and are performed
within the geographic boundaries of a HPSA area. The Incentive is paid only for
the professional service. Global services must be billed as two components with
separate charges for the professional component (billed with the HPSA modifier)

and the technical component (billed with no HPSA modifier). Services billed
globally with the HPSA modifier will be denied as unprocessable.
Billing requirement for HPSA:
To enable Medicare to correctly calculate the incentive payment, report
the services with the appropriate modifier for each procedure code:
QB Physicians providing services in a rural HPSA
QU Physicians providing services in an urban HPSA
If a QB or QU modifier is billed, indicating the service was rendered in a
HPSA, the physical location where the service(s) was rendered must be
entered if other than home in Item 32 on the CMS 1500 claim form.
HCFAC: Healthcare Fraud and Abuse Control Program, is under Office of Inspector
General (OIG) to control fraud and abuse that happening in health care.
HIPDB: Healthcare Integrity and Protection Data Bank is to collecting data’s
regarding the fraud and abuse that happening in the health care industry.
Stop loss clause: The explanation for stop loss clause is "a limitation on the
amount of loss sustained by the insured without compensation in a given period."
Prosthetic devices: Prosthetic devices are appliances which replace all or part of
a function of a permanently. In operative, absent or malfunctioning body part. The

term "prosthetic devices" includes orthotic devices, rigid or semi-supportive
devices that restrict or eliminate motion of a weak or diseased part of the body.
Prosthetic Devices helps to overcome injury and is designed to replace, correct or
support the function of body. These devices may be rented or purchased.
Insurance will cover for the charges if it is covered under subscribers plan.
Placement of false teeth is known as dental prosthetic devices and
placement of jawbones are known as maxillofacial prosthetic devices.
Examples of prosthetic devices are Communication aids, hearing aids,
artificial legs, hands, and limbs.
Factors for calculating Fee Schedule Payment Amounts
Under the formula set forth in section 1848(b) (1) of the Act, the
payment amount for each service paid for under the physician fee
schedule is the product of three factors: (1) A nationally uniform relative
value for the service; (2) a geographic adjustment factor (GAF) for each
physician fee schedule area; and (3) a nationally uniform conversion
factor (CF) for the service. The CF converts the relative values into
payment amounts.
For each physician fee schedule service, there are three relative values:
(1) An RVU for physician work; (2) an RVU for practice expense; and (3)
an RVU for malpractice expense. For each of these components of the

fee schedule there is a geographic practice cost index (GPCI) for each
fee schedule area. The GPCI’s reflect the relative costs of practice
expenses, malpractice insurance, and physician work in an area
compared to the national average for each component.
The general formula for calculating the Medicare fee schedule amount for
a given service in a given fee schedule area can be expressed as:
Payment = [((RVU work x GPCI work) + (RVU practice expense x GPCI
practice expense) + (RVU malpractice x GPCI malpractice)) x CF]
The CF amount changes for every calendar year.
Catastrophic Limit: The maximum amount of charges that the patient has to pay
out-of -Pocket expenses during that year by setting a maximum amount will
protect the patient.
Pre-determination: Obtaining estimation from the insurance carrier by the
provider before the service is rendered to the patient.
Revenue Codes: This code is used in hospital billing and we have a column in
UB92 for printing this revenue code. It is a three-digit code and mainly it is used
in care. For ex: If a patient is treated in a intensive care unit for that care will
have a revenue code and it is related with the procedure code.

Free look: Free Look is the 30 days trail period where one tries using the Medigap
policy and if he is not satisfied money will be reimbursed.
Hospice: Hospice is a special way of caring for people who are terminally ill, and
for their family. This care includes physical care and counseling. Hospice care is
given by a public agency or private company approved by Medicare. It is for all
age groups, including children, adults, and the elderly during their final stages of
life. The goal of hospice is to care for you and your family not to cure your illness.’
Who is eligible for Medicare Hospice Benefits?
Hospice care is covered under Medicare Part A (Hospital insurance) A
person is eligible for Medicare hospice benefits when:
• They are eligible for Medicare Part A (Hospital Insurance): and
• The concerned person’s doctor and the hospice medical director
certify that the patient is terminally ill and probably have less than six
months to live: and
• The patient sign a statement choosing hospice care instead of routine
Medicare covered benefits for your terminal illness*; and
• The patient receives care from a Medicare –approved hospice
program.
What is not covered?
The care that you get for your terminal illness must be from a hospice.
When you choose hospice care, Medicare will not pay for:

No-Fault Insurance: This comes in Auto Insurance where the insurance makes
the payment irrespective of the mistake on which side.
Referring & Ordering Physician: Referring physician is one who refers a patient
for the Professional services. Ordering physician is one who refers or orders the
patients for test like Radiology etc.
HCBS: Home and Community based services waivers .It is basically an agency
aims at providing high quality, cost effective, consumer directed, home and
community based services and support for all persons with all types of disabilities.
Enrolled & Effective date: Enrolled date is the date on which the person gets
enrolled with the insurance. Effective date is the date from which the insurance is
active and starts covering the insurer.
CHIP: Children's Health Insurance Program. It is a federal program jointly funded
by the states and the federal governments, which provides medical insurance
coverage for children's who are not covered by Medicaid funded program.
Ambulatory Care: Medical services provided on an outpatient (non-hospitalized)
basis. Services may include diagnosis, treatment, surgery, and rehabilitation. In
simple we can say a visit, which does not require overnight stay.

Surrogate UPIN: It is the dummy UPIN that has been assigned to
ordering/referring physician for temporary purpose.
Carve-out coverage: Carve-out refers to an arrangement where some benefits
(e.g., mental health) are removed from coverage provided by an insurance plan,
but is provided through a contract with a separate set of providers.
Experimental Procedures: Any health care services that are determined by the
insurance plan to be either, not generally accepted by informed health care
professionals in the US, as effective in treating the condition, illness or for which
their use is proposed or not proven by scientific evidence to be effective in treating
the condition for which it is proposed.
Open Enrollment: Specified period of time in which employees may change
insurance plans and medical groups offered by their employer and have the new
insurance effective at a later date.
Balance Billing: The practice of charging full fees in excess of covered amounts,
full fees in excess of covered amounts, then billing the patient for that portion of
the bill that the payer does not cover.
Multi-specialty Group: A group of doctors who represent various medical
specialties and who work together in a group practice.

Insurance Verification: Is a process of calling Insurance carriers regarding
member (policy holders) information (i.e., Member ID, coverage period etc.)
Telemedicine: The use of telecommunications (i.e., wire, radio, optical or
electromagnetic channels transmitting voice, data and video) to facilitate medical
diagnosis, patient care, and/or medical learning. Many rural area are finding uses
for telemedicine in providing oncology, home health, ER, radiology and psychiatry
among others. Medicaid and Medicare provide some limited reimbursement for
certain services provided to patients via telecommunication.
CHAMPUS (Civilian Health & Medical Program): Champus is run by the
Defence Department. It gives medical care to the active duty members of the
military as well as retirees & their eligible dependents. The new name of Champus
is Tricare.
Dual Eligible: Persons who are entitled to Medicare (Part A and Part B) and also
eligible for Medicaid are termed as dual eligible persons.
Dual Entitlement: An individual who is entitled to Medicare for two different
reasons is considered as dually entitled. Medicare entitlement based on ESRD and
aged or disability is considered dual entitlement. For example: An individual may
be entitled to ESRD and then become entitled based on aged or disability. Or, an
individual may be entitled to Medicare based on aged or disability and then
develop ESRD.

ESRD (End Stage Renal Disease): Kidney failure that is severe enough to need
life long dialysis or kidney transplantation is termed as ESRD. If a individual is
entitled to Medicare through ESRD, Medicare stands as a Secondary Payer (MSP),
during the 30 month co-ordination period (COB). The GHP (Group health plan)
acts as the primary in the COB period and at the completion of the 30-month COB
period, Medicare stands as the primary insurance for that individual.
AAPCC (Adjusted Average Per Capita Cost): An Estimate of how much
Medicare will spend in a year for an average Beneficiary.
ASC (Ambulatory Surgical Center): A place other than Hospital that does
outpatient surgery. At an ASC you may stay for only a few hours or for one night.
HHA: Home Health Agency-a facility or program licensed, certified or otherwise
authorized according to state and federal laws to provide healthcare services in
the home.
ALJ: Administrative Law Judge-a person who hears the appeals of the denied
claims.
Ancillary Services: Supportive services performed along with the Professional or
Technical services are termed as ancillary services.

EPSDT: Early and Periodic screening, diagnosis and treatment program: Persons
under 21 who are receiving Medical Benefits may receive health and dental
screenings and follow-up treatment for certain conditions. Providers include
physicians, health departments, schools and some local health clinics. These
exams are available on a periodic schedule based on the age of the individual.
Peer Review Organization: An organization of practicing doctors and other
health care providers who are paid by the Federal government for reviewing the
care given to Medicare Patients.
Catastrophic illness: It is a very serious health problem that could be life
threatening or cause life-long disability.
Gatekeeper: A primary care physician or managed care entity responsible for
determining when and what services a patient can access and receive
reimbursement for. A PCP is involved in overseeing and coordinating all aspects of
a patient's medical care. In order for a patient to receive a specialty care referral
or hospital admission, the PCP must preauthorize the visit, unless there is an
emergency. The term gatekeeper is also used in health care business to describe
anyone that makes the decision of where a patient will receive services.
CORF (Comprehensive Outpatient Rehabilitation Facility): A facility that
provides a variety of services including physicians services, physical therapy,
social or psychological services and outpatient rehabilitation.

Sub - Acute Care: Usually described as comprehensive in-patient program for
those who have experienced serious illness injury or disease, but when do not
require intensive hospital services, the range of services considered as sub- acute.
It includes infusion therapy, respiratory care, cancer, strokes and AIDS care.
Residual Market: Residual Market comes in to picture in Workers Compensation.
Private insurance companies will not provide coverage for workers where the risk
chances are very high. This uncovered area is known as Residual Market, where
the state and federal insurance covers this area.
NDC (Nation Drug Code): NDC is maintained by FDA (Food and Drug
Administration). NDC was originally established as an essential part of an out-of-
hospital during reimbursement program under Medicare. NDC serves as a
"Universal Product Identifier" for the human drugs. The format is usually 5-4-1. 5-
Labeler code, 4 - Product code & last one for package code, 1 – Serial Number.
Social Security Number (SSN): It was introduced and provided by Social
Security Act of 1935 to the each individual citizen in United States. This is a nine-
digit number (For example: 123 45 6789), First 3 Digit refers to Area Number.
Second 2 Digit refers to Group Number (01 to 99). The Last 4 Digit refers to Serial
Number (0001 to 9999).

Federal Insurance Compensation Act (FICA): It is a federal policy that
provides financial benefits to people when they retired (age sixty-two and older)
and/ or if they become disabled. Financial benefits may also be payable to a
worker's family when a worker dies or retires.
Supplemental Security Income (SSI): is a program is administered by the
Social Security Administration (SSA). A person who is disabled, blind or a least
age sixty-five may receive SSI if he or she meets certain financial eligibility
requirements.
PICA: Its is the payer position flag ("p"-primary, "s-secondary", or "t-tertiary") in
the first box marked "PICA" on the top left corner of the HCFA 1500 claim forms.
This information will be used by proclaim to organize the payer date correctly in
the transaction. If the payer position flag is left blank, then the claim will be sent
marked as primary.
Qualified Medicare Beneficiary: Designed to help low-income elderly or
disabled people on Medicare pay their medical expenses. The Qualified Medicare
Beneficiary (QMB) program, administered by the South Dakota Department of
Social Services, helps how-income elderly or disabled people on Medicare pay their
Medicare premiums, coinsurance and deductibles. The Special Low-income
Medicare Beneficiary (SLMB) and Qualifying Individual programs help low-income
elderly or disabled people pay their Medicare Part C medical insurance.

Open Access Plan:
• Specialist care without a referral: Open Access plans give you the
freedom to visit a specialist without a referral. You're encouraged to
choose a primary care physician (PCP) to coordinate your care and
treatment, but you're not required to do so. Your coverage level is
highest and there are no claim forms to submit when you visit in-
network providers.
Cigna offers three types of Open Access plans, each offering a different
level of choice and coverage:
• HMO Open Access/Network Open Access: This is a network-only plan-
you can visit any in-network specialist without a referral. There is no
out-of-network coverage, except in an emergency or urgent care
situation. You may choose a PCP to coordinate your care and treatment,
but you're not required to do so.
• Point-of-Service Open Access: You can visit any in-network or out-of-
network provider without a referral. Your costs are lower when you
choose in-network providers. You may choose a PCP to coordinate your
care and treatment, but you're not required to do so.
• Open Access Plus: You can visit any in-network or out-of-network
health care provider without a referral, though your coverage is higher
when you see in-network providers. We encourage you to use a PCP as a
personal health advocate to coordinate your care. With Open Access
Plus, you have access to a broad nationwide network of providers.

Duplicate Coverage Inquiry (DCI): A request to an insurance company or
group medical plan by another insurance company or medical plan to find out
whether other coverage exists.
Per Diem: Payment to a provider (normally an acute care facility) at an
established or negotiated rate per day rather than reimbursement of all hospital
charges as billed.
Open Enrollment: Specified periods of time in which employees may change
insurance plans and medical groups offered by their employer and have the new
insurance effective at a later date.
Over the Counter Drug (OTC): A drug product that does not require a
prescription under federal or state law.
Medigap: Privately purchased individual or group health insurance policies
designed to supplement Medicare coverage. Benefits may include payment of
Medicare deductibles, co-insurance and balance bills, as well as payment for
services not covered by Medicare.
Physician Extenders: Also called mid-level service providers. Physician
extenders include licensed nurse practitioners and/or licensed physician assistants.
They coordinate patient care under a doctor’s supervision.

Global Surgery: A Standard package of pre-operative, intra-operative and post-
operative services that is included in the payment for a surgical procedure.
Outlier Payments: Outlier payments are made to hospital to help offset some
of the financial losses associated with treating extremely high costs Medicare
cases.
Shadow Pricing: With in a given employer group, pricing of premiums by HMO
based upon the cost of indemnity insurance coverage, rather than strict adherence
to community rating or experience rating criteria.
Orphan Drugs: Orphan drugs are those that are so designated under subsection
526 of Federal Food Drug and Cosmetic Act by granting orphan drug status. The
FDA grants a manufacturer marketing protection for a particular drug for a
particular condition. No other manufacturer may market a generic version of the
drug for that indication.
UPIN (Unique Physician Identification Number): UPIN is issued to providers
by CMS. Providers who have UPIN only can bill Medicare. The format is 6 digit (3
alpha & 3 numeric).
PIN (Provider Identification Number): PIN is used by all insurance for
identifying the provider. The format differs by insurance.

Preventive Care: An approach to healthcare which emphasis preventive
measures and health screenings such as routine physicals, immunizations,
diagnostic lab and x-ray tests, mammograms etc., The purpose of offering
coverage for preventive care is to diagnose a problem early, when it is less costly
to treat.
Birthday Rule: The birthday rule related to the coordination of benefits and
determination of the primary payer when a child is covered by both parents health
insurance plans. This applies to non-divorced parents. The insurer of the parent
whose birthday month falls first in the year is the primary payers.
Chronic Condition: Impaired health status or medical condition that recurs or
persists over a long period of time as opposed to an acute or emerged condition.
Participating (par) facility: A facility that has completed the credentialing
process and signed a contract with the health plan to deliver medical services to
members. The facility may be skilled nursing facility, hospital, pharmacy, and
nursing home.
Partial Hospitalization: This is a short-term intensive treatment program where
individual's experiencing an acute episode of psychiatric illness can receive
medically supervised outpatient treatment. It serves an alternative to inpatient
care and allows patients who are not a danger to themselves or others to maintain
their everyday life without disruption after associated with a hospital stay. It

reduces the length of psychiatric hospitalization and serves as a step down from
an inpatient unit. It is called partial hospitalization because the patient attends
these 5-6 days a week and 6 hours per day, depending on patient’s condition.
Electronic Media Claims: Electronic claim submission is the state-of-the-art
method for sending and receiving files, documents, and data. Suppliers who utilize
electronic submission of claims to Medicare experience fewer delays than
traditional paper billing, plus they save money. If you are not an electronic biller,
consider making the switch.
Benefits of Electronic Media Claims
• Electronic claims allow for faster payment because they can be paid
after 13 days while paper claims cannot be paid for at least 27 days.
• Suppliers can trace their claims as they go through the system,
allowing for increased tracking capabilities. This is accomplished through
several methods. On-line receipt verification allows for verification after
claims transmissions verifying that the transmission was successful.
Electronic error reports and receipt listings allow suppliers to download a
summary of submitted claims within two days of transmission. This
provides the claim control number of claims that were accepted into the
system and error explanations of claims that were rejected.
• Rejected claims can then be corrected and re-transmitted with almost
no impact on the payment floor. Claim status inquiry allows the supplier
to log onto the system and electronically check the status of claims
rather then placing a call to a customer service representative.

• Lower administrative and postage and handling costs are incurred.
Electronic billing saves valuable production time. Personnel can be used
more effectively for other tasks such as customer service or marketing.
By using Electronic Remittance Notices (ERNs) and Electronic Funds
Transfer (EFT), suppliers can eliminate the tedious process of manually
posting to their accounting programs. ERNs can be used to automatically
download payment information and then automatically post that
information to accounts receivable.
To become an electronic biller, providers must submit an Electronic Data
Interchange (EDI) Questionnaire. All suppliers will need to complete a
testing process to get started in electronic billing. When this two-phase
process is completed, a supplier is assigned a permanent submitter
identification number. A supplier needs to only test their software with
one DMERC (however they still need to test communications with each
DMERC) and the submitter ID assigned to them will be accepted by all
DMERCs.
Magnetic resonance imaging (MRI): It is a method of creating images of the
inside of opaque organs in living organisms as well as detecting the amount of
bound water in geological structures. It is primarily used to visualize pathological
or other physiological alterations of living tissues as well as to estimate the
permeability of rock to hydrocarbons. It is now a commonly used form of medical
imaging.

Pediatrics: It is the branch of medicine that deals with the medical care of infants
and children. Most pediatricians are members of a national body, such as the
Canadian Pediatric Society, the British Association of Pediatric Surgeons or the
American Academy of Pediatrics.
One of the major challenges facing pediatricians is that the range of body sizes
(and weights) that they face in pediatrics is much greater than in adult medicine.
For example, a preterm neonate can be less than 2kg in weight while an obese
adolescent may be larger than the typical adult. Childhood is the period of
greatest growth, development and maturation of the various organ systems in the
body.
Another major difference between pediatrics and adult medicine is that children
are minors and, in most jurisdictions, cannot make decisions for themselves. The
issue of guardianship, legal responsibility and informed consent must always be
considered in every pediatric procedure. In a sense, pediatricians often have to
treat the parents (and sometimes, the family), not just the child
PACE (Program of All-inclusive Care for Elderly): provides and coordinates all
needed preventive, primary, acute and long term care services so that older
individuals can continue living in the community.
• How do people qualify for PACE?

In order to be eligible for PACE a person must be aged 55 or older,
certified by the state to need nursing home care and live in an area
served by a PACE program.
• Are prescription drugs covered?
Yes. All prescription and non-prescription drugs deemed necessary by
the PACE interdisciplinary care team are paid for by the PACE
program.
• Are people who do not qualify for Medicaid eligible for PACE
enrollment?
Yes. If a person meets the income and assets limits to qualify for
Medicaid, the program pays for a portion of the monthly PACE premium.
Medicare pays for the rest. If a person does not qualify for Medicaid, he
or she is responsible for the portion of the monthly premium Medicaid
would pay. PACE staff can help determine a person's Medicaid
eligibility.
• What happens if a person wants to leave PACE?
A PACE participant is free to cancel the enroll from PACE and resume
their benefits in the traditional Medicare and Medicaid programs at any
time.

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MEDICAL BILLING & CODING

5/4/2010 Page 1 of 310 Healthcare Division

5/4/2010 Page 2 of 310 Healthcare Division

5/4/2010 Page 3 of 310 Healthcare Division

closely monitors medically oriented businesses and institutions. Hospitals, clinics,

medical schools, and pharmaceutical companies must comply with government

standards. Doctors, nurses and other medical

personnel must be licensed, and becoming a

medical specialist frequently entails fifteen years

or more of rigorous schooling and training. The

average hospital contains millions of dollars worth of state-of-the-art equipment.

substantial amounts on research, knowing that new techniques and discoveries

but at the same time expensive care.

smart, but expect it to be a significant monthly expense.

5/4/2010 Page 4 of 310 Healthcare Division

number to call from anywhere in the United States for

immediate, skilled medical attention. While it is wise

to have other important numbers regarding medical

assistance (individual’s personal doctor, poison control

center, etc.) near telephone, in a genuine emergency it is imperative to dial

dispense the necessary help, both in terms of sending an ambulance and in

the ambulance arrives.

Emergency medicine in the U.S. is very high quality. Ambulance attendants, or

decisions that save lives. And many hospitals are

equipped with trauma centers whose single purpose is

handling emergency situations, including emergency surgery. In an emergency,

treatment center, a cardiac treatment center (heart attacks), a children's hospital

or a general hospital. If an individual is conscious, or if there is a family member

who will be summoned to the hospital to which patient is taken.

5/4/2010 Page 5 of 310 Healthcare Division

special procedures involved. It is important never to hesitate when there is a

to your doctor or a visit to a walk-in clinic would be sufficient.

and therefore is not limited to medical situations. Any time an individual is in

serious danger, witness an accident or a crime in progress, this number is called.

Why Health Insurance is needed?

for serious illnesses

One buy’s health insurance for the same reason one

buy’s other kinds of insurance, to protect one self

financially. With health insurance, an individual and

5/4/2010 Page 6 of 310 Healthcare Division

organizations (PPOs), health maintenance organizations (HMOs), point-of-service

(POS) plans and fee-for-service plans.

Individuals enrolled in health care plans pay a monthly or quarterly fee as

minimizing the amount an individual have to pay at the time of service.

depend on information like, whether an individual is married or single, have

in the section called Understanding Health Insurance Terms.

5/4/2010 Page 7 of 310 Healthcare Division

or buying individual insurance.

 Group Health Plans

Group Insurance Plans

part or all of the cost.

a fee-for-service plan, a Health Maintenance Organization (HMO), or a Preferred

required by Federal law to offer employees the chance to enroll in an HMO.

What happens if an individual or his family

member leaves the job? He will lose employer-

supported group coverage. It may be possible to

5/4/2010 Page 8 of 310 Healthcare Division

covered but now he /she is widowed or divorced. If an individual was covered

individual health insurance.

through membership in a labor union, professional association, club, or other

Individual Insurance Plans

If the employer does not offer group insurance, or

if the insurance offered is very limited, one can