Presentation is loading. Please wait.

Presentation is loading. Please wait.

Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Chapter 20 Basics of Health Insurance TEACH Lesson Plan Manual for Kinn’s.

Similar presentations


Presentation on theme: "Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Chapter 20 Basics of Health Insurance TEACH Lesson Plan Manual for Kinn’s."— Presentation transcript:

1 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Chapter 20 Basics of Health Insurance TEACH Lesson Plan Manual for Kinn’s The Medical Assistant: An Applied Learning Approach 12 th edition 1

2 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Types of Health Insurance 1. Define, spell, and pronounce the terms listed in the vocabulary. 2. Discuss the purpose of health insurance. 3. Differentiate among the various types of insurance policies. 2 Lesson 20.1

3 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. The Purpose of Health Insurance  Help individuals and families offset costs of medical care  Defined as contract for protection against financial losses resulting from illness or injury  Provides payment of monetary benefits for covered sickness or injury, depending on policy purchased 3

4 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Impact of Insurance Billing on the Medical Office  Nearly all of physician’s income comes from insurance payments received  Regular expenses, such as rent, salaries, medical and office supplies, equipment, and so on, depend on practice’s cash flow  Proper and timely filing of insurance claims to meet financial needs of medical office 4

5 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Cycle of Health Insurance  Insured or policyholder pays a set amount called a premium  A premium is periodic payment of a specific sum of money to an insurance company for which insurer agrees to provide certain benefits  Treatment is provided by physician or other provider in a doctor’s office, emergency room, or hospital, and fee is paid by insurance company when medical necessity and covered benefits are met 5

6 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Tasks Related to Cycle of Health Insurance  Obtain demographic, employment, and insurance data from patient and insured  Verify patient’s eligibility for insurance payment by insurance carrier  Perform diagnostic and procedural coding and review encounter form or charge ticket for completeness once patient has been seen by provider 6

7 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Tasks Related to Cycle of Health Insurance, cont’d  Calculate insurance deductibles and co- insurance amounts and provide patient with statement showing out-of-pocket amount owed  Obtain preauthorization for referral of patient to a specialist or for special services or procedures that require advance permission  Complete insurance claim form and submit to insurance company for reimbursement for services and procedures performed 7

8 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Tasks Related to Cycle of Health Insurance, cont’d  Post payments and adjustments on patient ledger or account and examine explanation of benefits (EOB), explanation of Medicare benefits (EOMB), or remittance advice (RA) from insurance company  Adjust account to reflect an allowable amount, which is either written off (adjusted) or passed on to patient for payment, and also any courtesy or professional adjustment 8

9 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Tasks Related to Cycle of Health Insurance, cont’d  Bill patient for outstanding balance or complete secondary insurance claim form and submit it to insurance company with a copy of EOB showing payment from primary insurance carrier  Follow up on any rejected or unpaid claims; any requests from insurance carrier for more information about specific claims answered as soon as possible  Meet timely filing requirements of medical office’s participating insurance carriers 9

10 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Determining Primary and Secondary Coverage  When patient is the insured, patient becomes the guarantor, and patient’s insurance is primary  If patient also is covered by another policy, that policy becomes secondary insurance  Only exception to is when patient is not insurance policy holder, such as when a child is insured by each parent 10

11 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Cost of Coverage  Most insurance carriers do not reimburse full amount for services and procedures rendered  Carrier is an insurance company or third party that pays for medical care  The insured, or beneficiary, in most instances is required to pay certain out-of-pocket expenses 11

12 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Cost of Coverage: Terms  Deductible is amount policyholder agrees to pay per claim or per accident toward total amount of insured loss before insurance company begins payment of benefits  Normally ranges from $100 to $500  Under most circumstances deductible must be paid only one time per calendar year 12

13 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Cost of Coverage, cont’d  Always verify effective date on patient’s insurance card  Verify eligibility, benefits, and exclusions with insurance company before patient’s visit  Verification done by phone, fax, or Web site 13

14 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Co-Insurance  Co-insurance is a policy provision common in medical insurance  Policy holder and insurance company share cost of covered losses in specified ratio  Co-payment is type of co-insurance collected at time of service  Most managed care plans require co- payment 14

15 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Types of Health Insurance  Health insurance is available to most in this country through group or individual plans  Types of health insurance available include group insurance, individual insurance, government- sponsored insurance, self-insured plans, and medical savings accounts  Many people are covered by government plans or entitlement programs  Government plans (state or federal) include Medicare, Medicaid, TRICARE, Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA), and workers’ compensation 15

16 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Group Policies  Insurance written under a group policy covers a number of people under a single master contract that is issued to employer or to an association with which they are affiliated  Group coverage usually provides greater benefits at lower premiums because of large pool of people from whom premiums are collected  Physical examinations are normally not required, and preexisting conditions are often waived 16

17 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Individual Policies  Individuals who do not qualify for inclusion in a group or government-sponsored plan may apply to companies that offer individual policies  Applicant required to fill out extended health questionnaire and undergo a physical examination before acceptance  With personal insurance there is a risk that coverage may be denied, and premiums are almost always higher with fewer benefits 17

18 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Government Plans  Patient who is 65 or older is covered by Part A and Part B of Medicare  Medically indigent patient may be eligible for Medicaid, with or without Medicare  Dependents of military personnel covered by TRICARE  Surviving spouses and dependent children of veterans covered by CHAMPVA  Some are covered for loss of wages and cost of care through worker’s compensation insurance 18

19 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. TRICARE  Public Law 569 passed in 1956 authorizing dependents of military personnel to receive treatment from civilian physicians at expense of government 19

20 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicaid  Medicaid started in 1965 to help medically indigent  Cost sharing between federal and state government to provide medical care for those meeting specific eligibility criteria 20

21 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare  Medicare started in 1965 and is a federal health insurance program for people age 65 and over; is part of Social Security Act  Also covers some under 65 with disabilities or end-stage renal disease (ESRD) 21

22 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Workers’ Compensation  All states have passed workers’ compensation laws to protect wage earners  State laws differ as to coverage 22

23 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Self-Insured Plans  Many large companies or organizations have a large enough employee base that they choose to fund their own insurance program, called a self- insured or self-funded plan  Self-funded plan is not insurance by true definition; employer pays employee healthcare costs from firm’s own funds  Tend to work best for companies large enough to offer lower rates, better coverage, and pay large claims for expensive medical services 23

24 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Self-Funded Healthcare  Self-funded healthcare is a self-insurance arrangement where employer provides health or disability benefits to employees with its own funds  Different from fully insured plans, in which employer contracts an insurance company to cover employees and dependents  Employer assumes direct risk for payment of claims for benefits  Terms of eligibility and coverage are set forth in a plan document 24

25 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medical Savings Account  Type of self-insurance for small companies, self-insured, or uninsured  Can purchase health insurance policies and make tax-free deposits to a medical savings account (MSA)  Use MSA money to pay small healthcare expenses, leaving catastrophic expenses to be paid by high-deductible insurance policy  Money remaining in MSA at year’s end earns tax-free interest 25

26 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medical Savings Account, cont’d  Generally associated with self-employed individuals  Withdrawals tax-free if used to pay for qualified medical expenses  MSA must be coupled with a high-deductible health plan (HDHP)  MSA funds can cover expenses related to most forms of healthcare, disability, dental care, vision care, and long-term care 26

27 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Insurance Benefits 4. Explain the numerous classifications of insurance benefits available. 5. Explain how insurance benefits are determined. 27 Lesson 20.2

28 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Types of Insurance Benefits 28

29 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Types of Insurance Benefits, cont’d 29

30 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Hospitalization  Hospital coverage pays cost of all or part of:  Hospital room and board  Hospital services, such as having surgery  Hospital policies usually set maximum amount payable per day and maximum days of care 30

31 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Surgical  Surgical coverage pays all or part of a surgeon’s fee  Some plans also pay for an assistant surgeon  Surgery includes any incision or excision, removal of foreign bodies, aspiration, suturing, and reduction of fractures  Insurer frequently provides subscriber with surgical fee schedule that establishes amount insurer will pay for commonly performed procedures 31

32 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Basic Medical  Pays all or part of physician’s fee for nonsurgical services, including hospital, home, and office visits  Patient usually pays deductible and a co- payment or co-insurance payment each time  May include provision for diagnostic lab, radiology, and pathology fees 32

33 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Major Medical  Provides protection against large medical bills resulting from catastrophic or prolonged illnesses  Covers most serious medical expenses up to a maximum amount, usually after a deductible and co-insurance have been met 33

34 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Disability (Loss of Income) Protection  Insures beneficiary’s earned income against risk that a disability will make working uncomfortable, painful, or impossible  Encompasses paid sick leave, short-term and long-term disability benefits  Many policies do not start payment until after a specified number of days or until a certain number of sick leave days have been used  Payment is made directly to individual, intended to replace lost income 34

35 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Dental Care  Dental coverage included in many fringe benefit packages  Programs offer a variety of options of either fee-for-service or managed care plans  Some policies are based on a co-payment and incentive program 35

36 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Vision Care  May include reimbursement for all or a percentage of cost for refraction, lenses, and frames 36

37 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Supplement  A supplemental health insurance policy to help defray medical costs not covered or only partially covered by Medicare  Medicare supplements that cover Medicare recipients’ out-of-pocket expenses, called Medigap policies 37

38 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Special Risk Insurance  Special risk insurance protects a person in event of types of accident or for certain diseases  Usually a maximum benefit 38

39 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Liability Insurance  Liability insurance covers losses to a third party caused by the insured  Types include automobile, business, and homeowners’ policies 39

40 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Life Insurance  Provides payment of specified amount on the insured’s death  Sometimes provide monthly cash benefits if policyholder becomes permanently and totally disabled  Sometimes proceeds from life insurance are used to meet expenses of insured person’s last illness 40

41 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Long-Term Care Insurance  Covers a broad range of maintenance and health services for chronically ill, disabled, or mentally retarded individuals  Services may be provided on an inpatient basis, on an outpatient basis, or at home 41

42 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. How Benefits Are Determined  Indemnity schedules  Service benefit plans  Resource-based relative value scale (RBRVS)  Determination of the usual, customary, and reasonable (UCR) fees  Relative value scale (RVS) 42

43 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Indemnity Schedules  More flexible yet more costly option  Traditional health insurance plans that pay for all or a share of cost of covered services, regardless of which provider is used  Often called fee-for-service plans  In exchange for premiums members pay, indemnity plan reimburses members or provider when claims are filed 43

44 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Service Benefit Plans  Insuring company agrees to pay for certain surgical or medical services without additional cost to person insured  No set fee schedule  Surgery with complications would warrant a higher fee than uncomplicated procedure  Premiums are sometimes higher for this type of coverage, but often payments are larger 44

45 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Resource-Based Relative Value Scale  Physician fee schedule amounts vary, depending on facility or nonfacility  Amount of resources required to perform a service is determined through use of relative value units (RVUs), which CMS assigns to Current Procedural Terminology (CPT) codes  System was implemented to standardize payment while providing an adjustment for overhead costs in different geographic areas  Takes into account these elements: physician expense, malpractice, geographic practice cost index, and conversion factor 45

46 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Usual, Customary, and Reasonable Fee  Charges for a specific service are compared with a database showing:  Charges to other patients for same service by same type of physician  Charges to patients by other physicians performing same or similar services in same geographic area  Insurance company determines whether provider’s charge is UCR, and any amount over allowed charge is not paid 46

47 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Managed Care Plans and Major Third-Party Payers 6. Differentiate among the different types of managed care options. 7. List and discuss other major third-party payers. 47 Lesson 20.3

48 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Health Insurance Providers  Include managed care plans, Blue Cross/Blue Shield (BC/BS), commercial insurance companies, and federal and state government programs, including Medicare, Medicaid, TRICARE, workers’ compensation, and disability insurance 48

49 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Managed Care  Umbrella term for all healthcare plans that provide healthcare in return for preset scheduled payments and coordinated care through a defined network of physicians and hospitals  Health maintenance organizations (HMOs) provide comprehensive healthcare to an enrolled group for a fixed periodic payment 49

50 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Managed Care, cont’d  Be familiar with individual managed care contract benefits and with procedures and processes for filing insurance claims  Review managed care plan’s specific handbook, contracts, and required forms 50

51 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Managed Care Policies and Procedures  Advantages of managed care include the following:  Healthcare costs are usually contained  Established fee schedules are used  Authorized services are usually paid for  Most preventive medical treatment is covered  Patients’ out-of-pocket expenses tend to be less than with traditional insurance 51

52 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Disadvantages of Managed Care  Access to specialized care and referrals can be limited  Physicians’ choices in the treatment of patients can be limited  More paperwork may be required  Treatment may be delayed because of preauthorization requirements  Reimbursement historically is less than with traditional insurance 52

53 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Comparison of HMO Models 53

54 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Health Maintenance Organization  Plan that contracts with a medical center or group of physicians to provide both preventive and acute care for insured  Regulated by HMO laws, which require them to include preventive care as part of their benefits package  Always require referrals to specialists, precertification, and preauthorization for hospital admissions, outpatient procedures, and treatments 54

55 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Health Maintenance Organization, cont’d  Providers receive payment according to various structures:  Capitation is payment in advance to provider by HMO for contracted group of patients  Fees charged for services to group members may be billed directly to IPA rather than to patient  Most common HMO models are IPA, staff model, group model, and EPO 55

56 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Independent Practice Association  IPA is independent group of physicians and other healthcare providers under contract to provide services to members of different HMOs, in addition to other insurance plans  Usually at a fixed fee per patient  Payments to providers by an IPA can be structured either as a capitation or fee for service 56

57 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Staff Model  A staff model HMO hires physicians and pays them a salary  HMO owns the network  Medical care is given or authorized by patient’s PCP  No capitation or fee-for-service payment structure is used with this model 57

58 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Group Model  Group model HMO contracts with a multispecialty medical group to deliver care to its members  HMO reimburses physicians’ group, which is responsible for reimbursing physician members and contracted healthcare facilities  Multispecialty group may organize a physician association; group members typically practice together in one facility 58

59 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Exclusive Provider Organization  EPO combines features of an HMO and a PPO  “Exclusive” because providers agree not to contract with any other plan  Members must choose medical care from network providers with certain exceptions for emergency or out-of-area services  Regulated under insurance statutes, not federal and state HMO regulations 59

60 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Preferred Provider Organizations  Managed care network of physicians and hospitals joined to contract with insurance companies, employers, or other organizations to provide healthcare to subscribers for discounted fee  Preserves fee-for-service concept that many physicians prefer  No capitation or prepaid care 60

61 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Preferred Provider Organizations, cont’d  Typically patient pays deductibles or co-insurance payments of 20% to 25% of predetermined charge and insurer pays balance  Physician treats patient and bills PPO  Furnish subscribers with list of member- providers to get PPO rates  Rates often lower than those charged to non-PPO patients 61

62 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Blue Cross/Blue Shield  America’s oldest and largest system of independent health insurers  Offers incentive contracts to healthcare providers  Participating providers agree to write off difference between amount charged by provider and approved fee established by insurer  Agree to bill patient only for deductible and co-pay/co-insurance amounts  BC/BS agrees to reimburse providers directly and in a shorter time 62

63 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Blue Cross/Blue Shield Identification Card 63

64 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicaid  All states and District of Columbia have Medicaid programs, but programs vary widely  Person eligible for Medicaid in one state may not qualify in another; services may differ  Federal government provides basic funding to state, after which states individually elect whether to provide funds for extension of benefits 64

65 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicaid, cont’d  Physician may accept or decline to treat Medicaid patients  Physician who does accept Medicaid patients automatically agrees to accept Medicaid payment as payment in full  Patient cannot be billed for difference between Medicaid fee and physician’s normal fee  Patient can be billed for any services not covered by Medicaid 65

66 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Examples of Those Who Qualify for Benefits  Individuals who are medically needy  Recipients of Aid to Families with Dependent Children (AFDC)  Individuals who receive Supplemental Security Income (SSI)  Individuals who receive certain types of federal and state aid  Individuals who are qualified Medicare beneficiaries (QMBs)  Individuals in institutions or receiving long-term care in nursing and intermediate-care facilities 66

67 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicaid Benefits ID Card 67

68 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare  Medicare is a federal health insurance program for the following:  People age 65 years or older  People who are permanently disabled or blind  People receiving dialysis for permanent kidney failure or who have undergone kidney transplantation 68

69 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Part A  Part A is hospital insurance covering:  Inpatient hospital care  Skilled nursing facilities  Home healthcare  Hospice services  Financed with special contributions deducted from employed individuals’ salaries, with matching contributions from employers 69

70 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Part B  Part B is medical insurance, requires a monthly premium, and covers:  Outpatient hospital care  Durable medical equipment  Physicians’ services  Other medical services 70

71 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Part B, cont’d  Patient with Medicare Part B must meet annual deductible before benefits become available  After which Medicare pays 80% of covered, or allowed, benefits  Physician usually accepts assignment of benefits for Medicare patients and is paid directly  Physician must accept payment that Medicare allows and bills patient only for 20%  If physician does not accept assignment, patient must pay entire bill and receives reimbursement check directly from Medicare 71

72 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Health Identification Card 72 (From Fordney MT: Insurance handbook for the medical office, ed 12, St Louis, 2012, WB Saunders.)

73 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Advantage (formerly Medicare + Choice)  Medicare Advantage offers expanded benefits for a fee through private health insurance programs, such as HMOs and PPOs that have contracts with Medicare  Patients must have a referral from their PCP before seeking treatment from another entity 73

74 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Medicare Part D  Part D offers a prescription drug plan at a reduced cost  All Medicare recipients eligible for Part D, hopefully reducing prescription drug costs  Private companies provide the Medicare prescription drug plans  Beneficiaries choose drug plan and pay monthly premium 74

75 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. TRICARE  Comprehensive healthcare program for family members of active duty personnel, military retirees and their eligible family members under age of 65, and survivors of all uniformed services  Managed by military in partnership with civilian hospitals and clinics  All military hospitals and clinics are part of TRICARE program and offer high-quality healthcare at low costs to plan users 75

76 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. TRICARE Eligibility  Individual must be a TRICARE or CHAMPVA recipient  Entitled to retired, retainer, or equivalent pay  Must be listed in Defense Department’s Defense Enrollment Eligible Reporting System (DEERS)  Also available for a TRICARE-eligible spouse under age 65 and dependent, unmarried children under age 21, or age 23 if in college full-time 76

77 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Types of TRICARE Plans  TRICARE Prime: Department of Defense’s managed care plan, similar to a civilian HMO  TRICARE Extra: preferred provider network plan  TRICARE Standard: traditional fee-for-service plan (formerly CHAMPUS) 77

78 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. CHAMPVA  Health benefits program similar to TRICARE for spouses and dependent children of veterans suffering total, permanent, service- connected disabilities and for surviving spouses and dependent children of veterans who died as result of service-related disabilities  Department of Veterans Affairs (VA) shares with eligible beneficiaries cost of certain healthcare services and supplies 78

79 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Workers’ Compensation  Federal and all state legislatures require employers to maintain workers’ compensation coverage for work-related illnesses and injuries  The law also protects wage earners against the loss of wages and the cost of medical care resulting from occupational accident or disease  No state’s workers’ compensation laws cover all employees; check with patient’s employer to verify insurance coverage 79

80 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Workers’ Compensation, cont’d  Compensation benefits include medical care benefits, weekly income replacement benefits for temporary disability, permanent disability settlements, and survivor benefits when applicable  Provider of service accepts workers’ compensation payment as payment in full and does not bill patient  Employee is obligated to promptly notify employer, who must then notify insurance company and refer employee to medical care 80

81 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Disability Programs  Health insurance that provides periodic payments to an individual to replace income when a sickness, injury, or disability that is not a work-related condition results in insured being unable to work 81

82 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Eligibility Procedures 8. Explain the procedure for verifying insurance benefits. 11. Perform eligibility and verification of benefits procedures. 10. Explain how to make managed care referrals and obtain precertifications. 12. Perform a preauthorization procedure. 9. Discuss the different types of fee schedules. 13. Demonstrate how insurance benefits are determined by calculating deductible and co- insurance payments. 82 Lesson 20.4

83 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Commercial Insurance  Many people are covered by health insurance issued by private (commercial) insurance companies  Physicians and medical societies control neither premiums paid nor benefits received from such policies  Payment is normally made to subscriber unless subscriber or insured has authorized that payment be made directly to physician 83

84 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Understanding Insurance Plan Requirements  Be familiar with handling of other tasks associated with an individual insurance plan or policy  Review carrier’s handbook, contracts, and required forms to familiarize themselves with plan’s benefits and preauthorization and referral requirements  Prepare required forms and insurance claims properly 84

85 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Utilization Management/ Utilization Review  A form of patient care review by objective professionals  Component of managed care to control costs  Utilization review committee reviews cases to ensure services provided were medically necessary and see how providers use medical care resources  Also reviews physician referrals and emergency/urgent care cases 85

86 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Verification of Insurance Benefits  Verifying benefits is necessary to ensure patient is covered by insurance and to determine what benefits will be paid for routine and special procedures and services  Verification protects physician and patient against unexpected medical care costs 86

87 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Verification of Insurance Benefits Form 87

88 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Steps for Verification of Benefits  When patient calls for appointment, identify type of insurance or managed care organization to which patient belongs  When patient arrives for appointment, photocopy both sides of patient’s ID card  Contact insurance carrier to verify patient is eligible for benefits and determine basic benefits, exclusions or noncovered services; also find out whether preauthorization is required for specific types of procedures and services  Obtain name, title, and phone number of person contacted 88

89 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Steps for Verification of Benefits, cont’d  Document information in patient’s medical record and on a verification of benefits form  Give patient a letter to read and sign outlining his or her insurance plan’s requirements and possible restrictions or noncovered items  When referrals are required, explain procedure to patient  Collect any co-payments or deductibles 89

90 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Sample Patient Responsibility Notification 90

91 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Precertification and Preauthorization  Many insurance companies require precertification or preauthorization if a patient is to be hospitalized or undergo certain procedures  Most managed care systems require preauthorization for patient to be referred to specialist or even for certain laboratory tests or other procedures  Insurance claims for payment will be denied if proper authorization is not obtained 91

92 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Precertification and Preauthorization, cont’d  For new patients, collect type of insurance and demographic information of patient and the insured  For an HMO, check plan’s contract for precertification or preauthorization requirements  Document information in writing or EMR before any services are given 92

93 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Sample Preauthorization and/or Referral Form 93

94 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Precertification and Preauthorization, cont’d  Fax form to insurance company  In emergency, obtain authorization by phone and fax form as soon as possible  Form faxed back with authorization number and other vital information  PCP or “gatekeeper” generally responsible for obtaining authorization 94

95 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Referrals  When a patient is referred to specialist by PCP  Referral form must be completed in entirety for approval or denial  Three types of referral:  Regular  Urgent  STAT 95

96 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Three Types of Referrals  Regular referral: usually takes 3 to 10 days for review; used when PCP thinks patient must see specialist for further treatment  Urgent referral: usually takes 24 hours for review; used when urgent, but not life- threatening situation occurs  STAT referral: can be approved immediately by phone; used for emergencies 96

97 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Provide Information to Specialist and PCP  Authorization code  Date on which referral request was received by utilization review department  Date on which referral was approved and its expiration date  Diagnosis code 97

98 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Provide Information to Specialist and PCP, cont’d  Name, address, and telephone number of contracted specialist  Comments section: this is most critical area of a referral, because this area designates services that have been approved 98

99 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Denial of a Referral  PCP’s office notified if referral is denied because of insufficient information or lack of medical necessity  When PCP’s office provides lacking information, referral is reviewed again 99

100 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Self-Referral  To be more competitive, some insurance companies allow patient to self-refer  Authorization not required to see specialist  Procedure for obtaining a self-referral is essentially the same as for a provider of service  Authorization form is completed by patient or with assistance of referred provider and faxed to insurance company 100

101 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Fee Schedules  Healthcare practitioner must place a value on three commodities: time, judgment (expertise), services  Fees differ for each office based on type of practice and needs of facility 101

102 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Third-Party Payers and Fee Schedules  Government and managed healthcare organizations influenced costs by establishing allowable charges (maximum amount paid out for a procedure or service)  When providers set a fee schedule, RBRVS and the lesser used RVS also affect charges  RBRVS-based fee schedule adjust fees for amount of resources required for services  Resources required determined through use of RVUs, assigned to CPT codes 102

103 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Resource-Based Relative Value Scale  RVRVS fee scale consists of three parts:  Physician work  Charge-based professional liability expenses  Charge-based overhead 103

104 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Resource-Based Relative Value Scale, cont’d  RBRVS fee schedule designed to provide uniform payments, after adjustment  Conversion factor is a single national number applied to all services, set by Congress  Provider either writes off difference between RBRVS schedule and fee or passes on nonallowed portion of charge to guarantor for payment 104

105 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Deductibles and Co-Insurance  Many plans require patient to pay out-of- pocket deductible and co-insurance  Often have annual deductible amount patient must pay before plan pays anything  Most indemnity plans have annual out-of- pocket limit on amount members pay for co-insurance payments  Takes major expense out of medical bills and helps keep premium costs down 105

106 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Calculation of Deductible and Co-Insurance 106

107 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Calculation of Allowable Amount 107

108 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Allowable Amounts  Limit placed on amount that will be reimbursed for any procedure or service is called an allowable amount  Amount can be all or part of a charge  Examine EOB from insurance carrier closely; contracts vary  Deductibles and co-insurance generally deducted from total charge for services rendered 108

109 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Calculating Deductible, Co- Insurance, and Allowable Amounts  Deductible and co-insurance are subtracted from total charge for services and procedures  Sum becomes patient’s responsibility  Can be billed to secondary insurance carrier if patient has one 109

110 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Closing Comments  Responsibilities include keeping patient informed and answering questions as they arise  Use good communication skills, patience, and tact when discussing third-party reimbursement issues with patients  Written release must be given for medical information to insurance claims processing 110

111 Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Questions? 111


Download ppt "Copyright © 2014 by Saunders, an imprint of Elsevier Inc. All rights reserved. Chapter 20 Basics of Health Insurance TEACH Lesson Plan Manual for Kinn’s."

Similar presentations


Ads by Google