Chapter 12 Commercial Insurance

INSURANCE This chapter will talk about how to complete fee-for-service claims that are generally accepted nationwide by most commercial health insurance companies Covers a portion of services, such as inpatient hospitalizations or physician office visits with patient paying the remaining costs Aetna, United Health Care. Prudential, Cigna and others --- REMEMBER BCBS, Medicare, Medicaid, TRICARE, CHAMPVA, workman’s compensation handled differently chapters specifically on those

Processing Commercial Claims Separate instructions for primary, secondary, and supplemental commercial insurance plans Instructions in a table format for completing claims

Processing Commercial Claims A case study and completed claim to illustrate the instructions A case study exercise, a blank claim, and the completed claim that allows the student to practice completing a claim

Commercial Insurance Commercial health insurance covers the medical expenses of individuals (e.g., private health insurance) and groups (e.g., employer group health insurance).

Commercial Insurance Individual health insurance policies are regulated by individual states and include the following: fee-for-service (or indemnity) insurance: traditional health insurance that covers a portion of services, such as hospital inpatient hospitalizations or physician office visits, with the patient paying the remaining costs Group health insurance usually costs less than individual private health insurance.

Commercial Insurance high-risk pools: “last resort” health insurance for individuals who cannot obtain coverage due to a serious medical condition; certain eligibility requirements apply, such as refusal by at least one or two insurance companies. State high risk pools if you are denied health insurance Currently 34 states offer a health insurance risk pool, covering over 180,000 people. For many people, risk pools provide a bridge between jobs or becoming self-employed. Advantages of getting into a state run insurance plan include: Usually can't be turned down Helps you pay for large medical cost Disadvantages: Have to prove state residency to enroll How proof that you have been rejected for similar health insurance coverage to enroll Can not have enrolled in a high risk pool with the last 132 months The state can end the plan - legislative risk Long waiting lists Usually much higher than private health insurance Have to prove your current policy is rated to enroll You can lose eligibility if you move You candon't qualify if are eligible for, or receiving, Medicare or Medicaid You cannot be incarcerated Plan typically only accepts certain numbers of individuals Rates can increase There are maximum benefit lifetime benefit ceiling You may not qualify with certain diseases

Commercial Insurance managed care (e.g., health maintenance organization, preferred provider organization)

Commercial Insurance association health insurance: offered to members of a professional association and marketed to small business owners as a way to provide coverage to employees The plans are not subject to the same regulations as group health insurance plans and, therefore, are more risky

Group Health Insurance Available through employers and other organizations (e.g., labor unions, rural and consumer health cooperatives), and all or part of premium costs are paid by employers.

Group Health Insurance Employer-based group health insurance: Covers all employees, regardless of health status, and cannot be cancelled if an employee becomes ill

Group Health Insurance Limits exclusions for preexisting conditions: The payer can exclude an employee from coverage for a preexisting condition but only for 12–18 months, depending on the circumstances.

Group Health Insurance Is portable: If an employee had insurance before enrolling in employer group health insurance, the payer must reduce the preexisting condition exclusion period by the amount of time covered on the previous plan.

Group Health Insurance Offers COBRA continuation coverage: When an employee resigns (or has another qualifying event), the employee must be offered COBRA continuation coverage that lasts for 18–36 months, depending on the employee’s situation. Qualifying event..use Colleen as an example Use Collin as an example dental insurance

Group Health Insurance Has employer-limited plan options (e.g., prescription drug plan that covers a certain list of medications, called a formulary) Will have name brand drugs one cost..generic another the four highest used drugs sometimes are not covered

Automobile Insurance A contract between an individual and an insurance company whereby the individual pays a premium and, in exchange, the insurance company agrees to pay for specific car-related financial losses during the term of the policy

Automobile Insurance Available coverage: Collision (pays for damage to a covered vehicle caused by collision with another object or by an automobile accident; a deductible is required) Comprehensive (pays for loss of or damage to a covered vehicle, caused by fire, flood, hail, impact with an animal, theft, vandalism, or wind; a deductible may apply) Deductible different for no fault or at fault collisions

Automobile Insurance Emergency road service (pays expenses incurred for having an automobile towed as a result of a breakdown) Liability (pays for accidental bodily injury and property damage to others, including medical expenses, pain and suffering, lost wages, and other special damages; property damage includes damaged property and may include loss of use) Each body part has a monetary assessment

Automobile Insurance Medical payments (reimburses medical and funeral expenses for covered individuals, regardless of fault, when those expenses are related to an automobile accident)

Automobile Insurance Personal injury protection (PIP) (reimburses medical expenses for covered individuals, regardless of fault, for treatment due to an automobile accident; also pays for funeral expenses, lost earnings, rehabilitation, and replacement of services such as child care if a parent is disabled) Can also be used for pedestrians injured by a veh

Automobile Insurance Rental reimbursement (pays expenses incurred for renting a car when an automobile is disabled because of an automobile accident) Underinsured motorist (pays damages when a covered individual is injured in an automobile accident caused by another driver who has insufficient liability insurance—not available in every state) Rental insurance monetary value of rental depends on your coverage plan some insurance policies you get the type veh you own. Others are straight base IE $30 a day…compact vehicle example my auto accident with Taurus injured wanted larger veh Underinsured motorist use Dad’s example he chances are about 14 in 100 that, if an insured car occupant is injured in an auto accident in the U.S., an uninsured motorist caused the accident, 14% of Americans driving are uninsured the highest uninsured driver estimates were Colorado (32%), New Mexico (30%), South Carolina (28%), Alabama (25%), and Mississippi (25%). The five states with the lowest uninsured driver estimates were Maine (4%), North Carolina (6%), South Dakota (6%), Massachusetts (7%), and Wyoming (7%). Sixteen states and the District of Columbia had a ratio of uninsured

Automobile Insurance Medical payments and PIP coverage usually reimburses, up to certain limits, the medical expenses of an injured driver and any passengers in a vehicle that was involved in an automobile accident

Disability Insurance Reimbursement for income lost as a result of a temporary or permanent illness or injury. When patients are treated for disability diagnoses and other medical problems, separate patient records must be maintained. Need to go to insurance company doctors not your personal doctor for assessment. Disability insurance generally does not pay for healthcare services, but provides the disabled person with financial assistance

Disability Insurance Disability benefits are usually paid if an individual Has been unable to do regular or customary work for a certain number of days (number of days depends on the policy) was employed when disabled (lost wages due to disability)

Disability Insurance Has disability insurance coverage Was under the care and treatment of a licensed provider during initial disability; to continue receiving benefits, the individual must remain under care and treatment Processes a claim within a certain number of days after the date the individual was disabled (number depends on policy)

Disability Insurance Has the licensed provider complete the disability medical certification document(s)

Disability Insurance Ineligibility for disability benefits due to Claiming or receiving unemployment insurance benefits Disability occurred while committing a crime that resulted in a felony conviction Receiving workers’ compensation benefits at a weekly rate equal to or greater than the disability rate

Disability Insurance Being in jail, prison, or a recovery home (e.g., halfway house) because of being convicted of a crime Failure to have an independent medical examination when requested to do so

Disability Insurance A disability claim begins on the date of disability: Disability payer calculates an individual’s weekly benefit amount using a base period. Usually covers 12 months and is divided into 4 consecutive quarters.

Disability Insurance Includes taxed wages paid approximately 6–18 months before the disability claim begins Does not include wages being paid at the time the disability began

Liability Insurance Covers losses to a third party caused by the insured or on premises owned by the insured. Claims are made to cover the cost of medical care for traumatic injuries and lost wages, and, in many cases, remuneration (compensation) for the “pain and suffering” of the injured party.

Liability Insurance Most health insurance contracts state that health insurance benefits are secondary to liability insurance.

Liability Insurance When negligence by another party is suspected in an injury claim, the health insurance company will not reimburse the patient for medical treatment of the injury until one of two factors is established:

Liability Insurance It is determined that there was no third-party negligence. In cases in which third-party negligence did occur, the liability payer determines that the incident is not covered by the negligent party’s liability contract.

Liability Insurance Subrogation refers to the contractual right of a third-party payer to recover health care expenses from a liable party.

Commercial Claims Determined by one of the following criteria: Patient is covered by one commercial plan. Patient is covered by a large employer group health plan (EGHP) and is also a Medicare beneficiary. Patient is covered by a small or large employer health plan and is the policy holder. Patient is also listed as a dependent on another EGHP.

Commercial Claims When the patient is a child who is covered by two or more plans Primary policyholder is the parent whose birthday occurs first in the year.

Commercial Secondary Coverage Changes are made to the CMS-1500 claim when patients are covered by primary and secondary or supplemental health insurance plans.

Commercial Secondary Coverage Secondary health insurance plans provide coverage similar to that of primary plans. Supplemental health insurance plans usually cover just deductible, copayment, and coinsurance expenses.

Commercial Secondary Coverage When the same payer issues the primary and secondary or supplemental policies, submit just one CMS-1500 claim. If primary and secondary or supplemental policies are different, submit a CMS-1500 claim to the primary payer.

Commercial Secondary Insurance When primary payer has processed the claim, generate a second CMS-1500 claim to send to secondary payer, and include a copy of primary payer’s remittance advice

Medicare Secondary Payer Working aged coverage by an employer group health plan (EGHP) or an individual aged 65 years or older who is covered by a working spouse’s EGHP

Medicare Secondary Payer Upon claims submission, amount of secondary benefits payable is the lowest of Actual charges by physician or supplier minus amount paid by primary payer

Medicare Secondary Payer Amount Medicare would pay if services were not covered by the primary payer Higher of the Medicare physician fee schedule minus the amount actually paid by the primary payer

Medicare Secondary Payer To calculate amount of Medicare secondary benefits payable on a given claim, the following information is required: Amount paid by primary payer Primary payer’s allowable charge