...Principles of Healthcare Reimbursement Anne B. Casto, RHIA, CCS Elizabeth Layman, PhD, RHIA, CCS, FAHIMA Copyright ©2006 by the American Health Information Management Association. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, photocopying, recording, or otherwise, without the prior written permission of the publisher. ISBN 1-58426-070-X AHIMA Product No. AB202006 Ken Zielske, Director of Publications Susan Hull, MPH, RHIA, CCS, CCS-P, Technical Reviewer Marcia Loellbach, MS, Project Editor Elizabeth Lund, Assistant Editor Melissa Ulbricht, Editorial/Production Coordinator All information contained within this book, including Web sites and regulatory information, was current and valid as of the date of publication. However, Web page addresses and the information on them may change or disappear at any time and for any number of reasons. The user is encouraged to perform his or her own general Web searches to locate any site addresses listed here that are no longer valid. AHIMA strives to recognize the value of people from every racial and ethnic background as well as all genders, age groups, and sexual orientations by building its membership and leadership resources to reflect the rich diversity of the American population. AHIMA encourages the celebration and promotion of human diversity through education, mentoring, recognition, leadership, and other programs. American...
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...Stephanie Myers December 4, 2014 The Affordable Care Act and Medicaid Reimbursement Shortcomings Fewer physicians are accepting new Medicaid patients today, mainly because of low reimbursement rates and the large increase in the number of Medicaid enrollees. As many states have expanded Medicaid in response to the Affordable Care Act (ACA), which promises additional federal funds for a number of years, the number of Medicaid patients has increased dramatically. The problem is Medicaid only reimburses doctors about 60 percent of what private insurers pay (Glans, 2014). Many physicians limit the number of Medicaid patients they serve in comparison to those with private insurance because they simply cannot afford to take too many patients receiving subsidized care (Glans, 2014). Unfortunately, some refuse to accept any Medicaid patients, and with the shortage of primary care providers, is access really improving? Insurance officials recognize the reduced rates in some plans, and express are under enormous pressure to keep premiums affordable. They believe that physicians will make up for the lower pay by seeing more patients, since the plans tend to have smaller networks of doctors. From the provider perspective, if a rate has already been negotiated from insurance, it should be the same on or off the exchange since the same services is being provided (Rabin, 2013). Yet many physicians complain of not being able to see their current patients, so it is unlikely public insurance...
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...continuous confusion between staff seeking reimbursement for travel, the Travel office has outlined the following Process and Procedure for reimbursement. First, staff should understand it is the policy of the company to reimburse staff and guests for reasonable and necessary expenses incurred in connection with approved travel. Prepayment of reimbursement is allowed only when payment for the expenses has not been and will not be received from another source. The company has significant airline, vehicle rental, and charter bus discounts that can be obtained when booking travel through the company’s designated travel agencies. Travelers are strongly encouraged to utilize these designated travel agencies when making travel arrangements. Additional information about these services is provided by the Travel Office. Individuals are considered in travel status when traveling on official business for the company whether or not expenses are to be reimbursed. All travelers seeking reimbursement should incur lowest reasonable travel expenses. The process is as follows. Travelers must first receive authorization. Travelers should verify that planned travel is eligible for reimbursement before making travel arrangements. Upon completion of the trip and within 90 days, the traveler must submit a Travel Reimbursement Form and supporting documentation to obtain reimbursement of expenses. An individual may not approve his/her own Travel Order or Reimbursement. Individuals with responsibility...
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...SOLUTIONS Multiple Choice Questions: 1. Which of the following statements about finance, accounting, and financial management is most correct? a. Accounting is of no value in decision making. b. Accounting provides the theory and concepts necessary to help managers make better decisions. c. Financial management involves the measurement, in financial terms, of operational events that affect the resources and financing of an organization. d. The primary role of finance is to plan for, acquire, and use resources to maximize the efficiency and value of the enterprise. e. Financial management is of no value in decision making. 2. Which of the following statements about the role of finance in healthcare organizations is incorrect? a. Over time, the finance function has become increasingly focused on strategic issues, such as joint venture decisions. b. Today, the most critical finance function is cost identification. c. The finance function often supports cost containment efforts and third-party payer contract negotiations. d. The primary activities of the finance function can be summarized by the four Cs: costs, cash, capital, and control. e. In times of high profitability and abundant financial resources, the finance function tends to decline in importance. 3. Which of the following is not a hypothesized benefit of integrated delivery systems? a. Information systems that track all aspects of patient care can be developed more easily. b. Integrated...
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...the patient safety report, the IOM released “Crossing the Quality Chasm.” The report framed underlying reform necessary in the current health care delivery system to ensure patient safety. The framework sought to hold providers accountability for the quality of care they deliver. The introduction of the pay for performance (P4P) as opposed to the prior fee for service and prospective reimbursement guidelines induces delivery of care based upon performance measures. Broadly defined pay-for- performance includes any type of performance-based provider payment arrangements, including those that target performance on cost measures (U.S. Department of Health & Human Services, 2006) Reimbursement Pay-for-performance, synonymous with quality-based purchasing, bases reimbursement upon quality measures. The historic fee-for-service reimbursement plan enticed providers to maximize treatment to maximize reimbursement without capitation. In 1983, the Centers for Medicare and Medicaid (CMS) introduced the payment system driven by diagnosis-related groups (DRG’s). This payment system projected reimbursement based...
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..................................................... 4 Executive Summary ...................................................................................................................... 5 Provider Survey ......................................................................................................................... 6 Standards of Care Economic Model .......................................................................................... 7 Recommendations .................................................................................................................... 8 Care Management ................................................................................................................................ 8 Payment Reform ................................................................................................................................... 9 Workforce Supply ............................................................................................................................... 10 Background and Role of the Diabetes Working Group ............................................................... 12 Background ............................................................................................................................. 12 Role of the Diabetes Working Group ....................................................................................... 13 Provider Survey...
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...EMPLOYER TUITION DEFERRAL PLAN 2014/2015 DePaul’s Employer Tuition Deferral program is an option for students who receive tuition reimbursement from their employers. It is administered through the Student Accounts office. The program is designed to view coverage by an employer tuition reimbursement program as pending payment. Since employer reimbursement is generally issued at the end of a term, this tuition deferral allows the students covered by such an employer reimbursement plan to receive an extended payment due date for their tuition charges. Bills and grades will be issued to the students only and not to the employers. It is the responsibility of the student to provide their employers with copies of any documents their employer may require. Regardless of when the employer reimburses the student, the tuition due dates are not negotiable. WHAT ARE THE ELIGIBILITY REQUIREMENTS? Students must submit the application by the application deadline. If there is a doubtful account history, past due balance, or insufficient employer documentation, the student will not be accepted into the program. WHAT COURSES CAN I ENROLL TO BE ELIGIBLE FOR THIS PROGRAM? To be eligible to participate in this program, students must be enrolled in the traditional terms (see qualify terms). Special seminars, extended courses, workshops, courses which require pre-payment, audits and zero credit courses are not covered in this program. CAN I APPLY FOR THIS PROGRAM IF I HAVE ALSO APPLIED FOR...
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...LP4 Assignment: Physician Reimbursement • What are the different methods that MCOs reimburse providers for health care services? There are a variety of options available employers have for compensating providers. There is the Non-Risk-Based Physician payment used by all types of Payers which includes: • Fee-For-Service: a payment method where the provider is paid a fee for each procedure performed and billed. There are straight charges; Usual, customary, or reasonable (UCR) allowances; percentage discount on charges; fee schedule; relative value scale (RVS); resource-based relative value scale (RBRVS); Percent of Medicare RBRVS; Special fee schedule or RVS multiplier; Facility fee add-on (pg. 122) • Case rates and global fees: A case rate is single payment that includes all professional services provided in a defined episode of care. (pg. 128). •...
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...Managed Care Lucille Purry Economics of Healthcare Faculty Sever South University 10 December 2013 Abstract Managed care, a deliver system for health care intended to reduce the cost of that care. Examples of managed care organizations are HMO, IPA, PPO, POS and PFFS. MCO’s operate through contractual agreements that are set to meet certain standards due to the fact that they don’t have direct control. Managed care provider and hospital reimbursement ranges from fee for service and capitation. Episode-of-care is where providers receive one lump sum for all the services they provide related to a condition or disease, and capitation is where the third party payer reimburses providers a fixed amount for a period. There are many other forms of reimbursement between these two methods and vary depending on service. Risk – based payment applies to both hospitals and providers. With so many choices in health care coverage and means of payments, it becomes necessary to be sure you have a complete understanding of what is expected from you, what is covered and not covered and to be sure any treatment is necessary. Along with managed care, we have to consider how this affects Medicare and Medicaid. These have changed the healthcare system and joined together to better serve the public. Managed care; advantages and disadvantages as well as how it came to be are to follow. Managed Health Care dates as far back as 1910; one example is when the Western Clinic in Tacoma, Washington...
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...Comparison Reimbursement Programs and the Movement of Finances in the United States Health Care System by Ronald J. Sanders MBA520, MBOL2, Health Care Organization Instructor: Dr. Sandra Washington Saint Leo University Distance Learning March 17, 2013 Abstract Effective payment program strategies are a major part of administering health care. Reimbursement programs are a part of the United States (U.S) health care system. They represent a financial tool for providing cash flow to service physicians and hospitals. Many times, the ability to provide quality health care depends on the payment for the services given by physicians and hospitals. This paper presents a view of payment reimbursement systems within the health care industry. A comparative overview and description of payment reimbursement will be given in order to understand the flow of finances in the health care industry. The focus will be on the capitation and fee-for-service reimbursement systems. Readers will then be able to conclude that the appropriate reimbursement method is dependent upon the amount of risk a party is able to assume. Comparison of Reimbursement Programs and the Movement of Finances in the United States Health Care System Physicians that are part of the managed care system have several methods in which to be compensated or be reimbursed for services. Two popular methods are Capitation and Fee-for-Service. Physicians have confronted several challenges...
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...Pay-for-performance and Reimbursement Jason Teker HCS/531 May 2, 2016 Georgetta Baptist Pay-for-performance and Reimbursement Health care is in the middle of a change in how payment is received for services provided. Fee-for-service is the dominant form of reimbursement for hospitals and doctors. According to Medicaid’s website, the fee-for-service payment model is structured so that there are incentives in place based on the number of services provided. Fee-for-Service models allow for a system where quantity is more important than quality. With rising health care costs, the federal government is looking to change the way hospitals and doctors are reimbursed for their services. Quality health care is becoming a hot topic in many realms of the health care industry. The government has proposed a new form of repayment in a system called Pay-for-performance which was brought to the forefront of policy agendas by the Institute of Medicine’s (IOM) report in 2000 titled To Err is Human (Mayes, 2006). In the report, the IOM estimated “as many as 98,000 patients die annually in U.S. hospitals due to preventable medical errors” (Mayes, 2006, p.17). Pay-for-performance is “a reimbursement method under which some physicians and hospitals are paid more than others for the same services because they have been deemed to deliver better quality care and their patients appear to have better outcomes” (Mayes, 2006, p.17). With this new reimbursement method, the incentives are now...
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...track deadlines, payments and recoupment of payments? Because deadlines for appeals were being missed, recoupment of payments with no documentation of reason for recoupment, and one centralized location for tracking audits and appeals needed. Bottom line for a CFO -- is the bottom line. Even with a simple tracking program and patient software for recording payments and adjustments, the administration of audits and appeals needed an overhaul. So after a contracted (government-like) study costing somewhere near $100,000 (L. Emerson, personal communication, October 14, 2014), a new department was recommended to handle any Recovery Audits. The Recovery Audit Response Program department was born. Let’s take a closer look… Evaluate: Who makes up the new department? What are recovery audits? The Centers for Medicare and Medicaid (CMS) was issued a mandate to implement the Recovery Audit program (RACs) to investigate and correct the overpayments made by their Medicare Administrative Contractors (MACs) who are contracted to payment Medicare claims presented by Medicare participating providers. A demonstration program was implemented and running for a year before the Recovery Audit Contractors were chosen. Their directive was to look at a particular number of medical records and determine if Medicare overpaid or underpaid the provider. By looking at the documentation sent by the provider to the RAC, the RAC determined that the documentation supported the payment or fell short...
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...in 1983 to reimburse hospitals for inpatient admissions. Some hospitals are excluded from this form of reimbursement such as psychiatric hospitals, rehab facilities, long term and cancer hospitals. The CMS administers the DRG system and issues all the guidelines for it. DRG’s are updated on October 1st every year. This includes base rates, wage directories, establishment of new DRG’s and elimination of others. On October 1st, 2007, CMS established a new set of codes known as Medicare Severity Diagnosis Related Groups (MS-DRGs). These codes are more specific and take into account the severity of a patient’s illness and the resources used. As a result, a more suitable reimbursement is issued. There is about 750 MS-DRGs and 538 DRGs. The payment method used by Medicare for hospitals is known as DRG weight of one. Payments are made per admission where the hospital and payor agree on a base rate that is multiplied by DRG weight to determine reimbursement. Length of stay don’t factor in unless there is an outlier case. The Ambulatory Payment Classification (APC) system uses Current Procedural Terminology (CPT) and Healthcare Common Procedure Coding System (HCPCS) to classify outpatient hospital admissions into clinically related groups that reflect the extent of care administered. It was established by Medicare in 2000, and certain hospitals are excluded from APC reimbursement such as Maryland Hospitals, critical access hospitals, Indian Health Service Hospitals. APCs are updated...
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...Procurement Law Overview, Part One Procurement and Contract Law Procurement Law Overview, Part One The purpose of this paper is to provide an overview of procurement law. There are three different branches of Government: Legislative, Executive, and Judicial. In the United States, the Office of Federal Procurement Policy (OFPP), the Defense Acquisitions Regulations (DAR) Council, and the Civilian Agency Acquisition (CAA) Council determine federal procurement policies by its legislative action and recommendations. Those are then published in the Federal Acquisition Regulation (FAR). The FAR is issued jointly by the Department of Defense (DOD), the General Services Administration (GSA) and the National Aeronautics and Space Administration (NASA). It applies not only to direct purchases made by the government, but also to purchases made by federal grant recipients (Feldman, 2010). The government procurement team is made up of the Contracting Officer (CO), Administrative Contracting Officer (ACO), and Termination Contracting Officer (TCO). The government planning process consists of market research and an internal source search before they proceed with full and open competition which allows all responsible sources to submit either a sealed bid or competitive proposal on the procurement. The market research consists of availability and quantities of items, and reasonable prices. Internal sources include existing inventory, excess from other agencies, and federal prisons (Feldman...
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...Insurance companies. 2. Compare the UCR and CPR payment systems? UCR and CPR: Both or methods of payment within the type of tradition retrospective payment system. Both or based on data from past claims. Private Insurance companies use the UCR and Medicare uses the CPR. 3. Describe the two purposes of managed care? The two (2) purposes of Manage care are to control and reduce c\ost while ensuring continuing quality of care. 4. Why have many insurers replaced retrospective health insurance plans with group plans such as HMOs and PPOs? Provider get paid up front with controlled cost while providing quality care no risk, they get paid for level 1,2, or 3 preset price and no risk for Insurance companies. 5. What are advantages of capitated payments for providers and payers? The provider has a guaranteed customer base and the third party payer know the exact cost of the healthcare group payment. 6. Describe the major benefits of episode-of-care reimbursement according to its advocates and the major concern s about episode of care reimbursement expressed by its critics? The benefit is for the provider their paid upfront for all services provided over period of time or specific amount of days. They can’t add any individual fees or charges. The Insurance company/administrators are predicting or making healthcare decision rather than the Doctor. 7. How do their-party payers set per diem payment rates? Third-party payer set per diem using historical...
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