Medical Billing

Saturday, October 16, 2010

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.

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.

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.
<br />scrolling="no" width="200" noresize="noresize">
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

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 HCFA) 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.

Why you Need Health Insurance?

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 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 a 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.

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.

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.