1. The Blues Plans, Private Insurance, and Managed Care Plans
Up to this point, we have been discussing the basics of health insurance: roles and responsibilities of the insurance biller, dealing with patients, and patient and insurance collections. The last half of this quarter will deal with specific insurance plans, such as managed care, Medicare, Medicaid, and Workers Comp.
Tonight we will look at the Blues and managed care. Thursday we will cover Medicare.
Chapter 11

2. WHAT IS INSURANCE?
What are the responsibilities of a health insurance plan?
What are the responsibilities of the healthcare provider?
What are the responsibilities of the patient regarding health insurance?

3. Healthcare Payers Government programs Private Health Insurance
Workers Compensation
Automobile Insurance
Managed Care Plans
Third party payers are entities other than the patient or physician who pay for healthcare services.
We know that physician and hospitals receive more than 80% of all revenue from insurance payments.
Third party payers include several government programs, including Medicare and Medicaid; more than 13,000 private and managed care health insurance companies, workers comp and automobile insurance.
This module will focus on the various health plans, and tonight we will discuss the private health insurance, including the Blues and managed care.

4. Private Health Insurance
Private corporations
Non-profit corporations
Three major sources
Group health
Self-insured plans
Individual insurance
Private heath insurance is coverage for healthcare services offered by private corporations, such as Cigna, Aetna, and United Heathcare, and by non-profit corporations, such as Blue Cross Blue Shield.
Private heath insurance pays for approximately 39% of healthcare expenses.
The three major sources of private health insurance are group health plans, self-insured plans, and individual insurance.
Each plan offered by a company has different requirements for coding and billing, and it the insurance biller has to know all of the requirements in order to code and bill correctly, resulting in faster reimbursement for the practice.

5. Group Health Plans Insurance offered through an employer or union
Specific benefit package
Multiple options
Premiums paid jointly by employer/union & employee
Approximately 60% of American are covered by a group health plan offered through their employer or union.
Employer/union contracts with a private insurance company, such as Aetna or Cigna, to provide a set of specific health benefits to their employees.
Some employers offer multiple levels of benefits, with varying deductibles, coinsurance, or copays, and employee chooses which benefit level they are willing to pay for.
The full premium payment is shared by the employer/union and the employee; deductibles, copays, coinsurances are paid by the patient.
The advantage of a group health plan is that the cost of medical care is shared by a large number of people (the group) keeping premiums at a reasonable cost.

6. Self-Insured Health Plans
Offered by large employers or unions
Money is set aside in a reserve fund and employee medical expenses are paid out of this fund
State regulated
Specific benefit package
Deductibles, coinsurance, copays apply
Processed by a third-party administrator (TPA)
Self-insured health plans are offered by large employers or unions who, instead of purchasing health insurance coverage directly, put money into a reserve fund to pay healthcare expenses for their employees.
States regulate the reserve fund to ensure that employers are depositing enough money into the fund to cover catastrophic expenses.
Works the same as a group heath plan in that the company offers a specific set of benefits to their employees, and the employee is responsible for any deductible, copay, and/or coinsurance that might apply.
Claims are processed directly by a third-party administrator (TPA)

7. Individual Health Insurance
Individuals purchased direct from health insurance company
Individuals choose the services they will purchase
Individual health insurance is a plan that people purchase directly from a health insurance company
Approximately 9% of Americans are covered by individual health insurance

8. BLUE CROSS BLUE SHIELD

9. The Association National federation
37 independent, community-based, and locally-operated companies
170 countries and territories around the world
The Association grants licenses to independent companies to use the trademarks and names
The Blue Cross Blue Shield Association is a national federation of 37 independent, community-based, and locally operated BCBS companies. The Association owns and manages the BCBS trademarks and names in more than 170 countries and territories around the world. The Association grants licenses to independent companies to use the trademarks and names in exclusive geographic areas.

10. The Network Independently owned by each state Multiple policy types
PPO/HMO
State health plans
Federal Employee Program
Medicaid Managed Care
Medicare Advantage
ID cards
Identify policy type
Alphanumeric insured ID#
Group numbers
Every state offers policies from the BCBS Association
Traditional PPO policies and HMO policies
State health plans cover State employees
Federal Employee Program covers federal employees
ID cards identify the policy type, copay requirements, claims submission information
Various plays on the alphanumeric ID#

11. Local and Blue Card Program
State in which you are contracted
“Local Plan”
Blue Card Program
Out-of-state issued policy
Patient receives services locally
Claims are filed to the “home plan”

12. BCBS of South Carolina Alpha prefixes BCBS NC
ZCY, ZCW, ZCZ – group or individual policies
SYY, AVC, BBT, BLI – other local prefixes
ZCS – State Health Plan
ZCP – Medicare Advantage
ZCD – Medicaid Managed Care
ZCC, ZCL – Blue Choice
R – Federal Employee Program
BCBS NC
YPY, YPP
Any policy ID # with a three-letter alpha prefix is filed through the home plan for pricing; out of state policies are sometimes processed by South Carolina, and sometimes sent to the home plan for processing, then back through South Carolina for payment

13. My Insurance Manager www.southcarolinablues.com Eligibility/benefits
Authorizations/referrals
Education
Forms
Stat Chat

15. Managed Care Plans Cost control Contract based
In-network group of “preferred” providers
Group health plans
Self-insured health plans
Individual health plans
Medicaid
Medicare
Worker’s Comp
Managed care plans are companies that attempt to control the cost of healthcare while still providing clinical quality care aimed at producing better outcomes for their patients.
Managed care plans contract with physicians and other providers to offer services for a lower fee than health plans; they contract with health insurance companies and self-insured plans to promote an exclusive network of preferred providers. Patient receive the same quality healthcare, but out of pocket costs are less when they use an in-network provider.
Managed care plans are not a separate type of heath insurance, but a way of offering services to patients who are enrolled in a group health, self-insured, or individual health plans.
Managed care plans also offer plans in State Medicaid programs and Medicare Advantage, or Medicare Part C, plans; sometimes they even extend into Worker’s Comp carriers

16. Indemnity Plans Benefits Out-of-pocket expenses Preferred provider
Maximum benefit for services rendered
Out-of-pocket expenses
Deductible has to be satisfied before insurance will pay any claims
Patient may be required to pay up front
Preferred provider
No requirement for referral
Various authorization requirements
Health insurance plans can be broadly divided into two large categories: (1) indemnity plans (also referred to as "reimbursement" plans), and (2) managed care plans.
An indemnity plan reimburses the patient for medical expenses regardless of who provides the service, although in some cases the reimbursement amount may be limited.

17. Managed Care Plans HMO PPO POS All managed care plans:
Involve a contract between insurer and provider
Offer policyholders incentives to used network providers
Managed care plans There are three basic types of managed care plans: (1) Health Maintenance Organizations (HMOs), (2) Preferred Provider Organizations (PPOs), and (3) Point of Service (POS) plans. Although there are important differences between the different types of managed care plans, there are similarities as well. All managed care plans involve an arrangement between the insurer and a selected network of health care providers (doctors, hospitals, etc.). All offer policyholders significant financial incentives to use the providers in that network. There are usually specific standards for selecting providers and formal steps to ensure that quality care is delivered.
So which is better? In general, managed care plans are better suited for the average individual because they end up being more cost effective in the long run. In contrast, indemnity/reimbursement plans usually hit the patient with more out-of-pocket charges (in the form of deductibles and co-payments) and often place caps on the amount of benefits they can receive over a lifetime. Indemnity plans do give the patient more freedom, however, than managed care plans in terms of using the healthcare provider of his choosing. So, as with anything else, the choice between managed care and indemnity plans ultimately depends on the patient’s circumstances and preferences.

18. Three Major Types of Managed Care Plans
Health Maintenance Organization (HMO)
Prepaid health care
Members have to use in-network providers
Preferred Provider Organizations (PPO)
Network of providers that provide medical services to only a specific group or association
Members pay for services as they are rendered
Employer or insurance company reimburses member
Accept Assignment?
Reimbursement if negotiated in advance (contracted) by the healthcare provider and PPO
Often utilize a primary care physician to coordinate are
“Gatekeeper”
Health maintenance organizations (HMOs) HMOs provide medical treatment on a prepaid basis, which means that HMO members pay a fixed monthly fee, regardless of how much medical care is needed in a given month. In return for this fee, most HMOs provide a wide variety of medical services, from office visits to hospitalization and surgery. With a few exceptions, HMO members must receive their medical treatment from physicians and facilities within the HMO network.
Preferred provider organizations (PPOs) A PPO is made up of doctors and/or hospitals that provide medical service only to a specific group or association. Rather than prepaying for medical care, PPO members pay for services as they are rendered. The PPO sponsor (usually an employer or insurance company) generally reimburses the member for the cost of the treatment, less any co-payment. In some cases, the physician may submit the bill directly to the insurance company for payment. The insurer then pays the covered amount directly to the healthcare provider, and the member pays his or her co-payment amount. The price for each type of service is negotiated in advance by the healthcare providers and the PPO sponsor(s).

19. Three Types of Managed Care Plans, cont’d
Point of Service (POS)
No deductible; minimal copay
If…..member uses an in-network provider
If not……higher out-of-pocket expenses for patient
Primary care provider required
Point of service (POS) plans A point of service plan is a type of managed healthcare system where the patient pays no deductible and usually only a minimal co-payment when he uses a healthcare provider within the network. He also must choose a primary care physician who is responsible for all referrals within the POS network. Failure to use an in-network provider may result in higher costs for healthcare.

20. Exclusive Provider Organizations (EPO)
Combines features of HMOs and PPOs
Employers agree not to contract with any other plan
Providers give negotiated discounts
No out-of-network benefits
Patient must use a Gatekeeper
An EPO (exclusive provider organization) health insurance plan is one in which all covered services are rendered by health care providers that have signed up with the insurer to offer such services. It is similar to preferred provider organization (PPO) insurance plans, under which customers can obtain medical care at a lower cost from providers that are part of the PPO's network. However, in most PPO plans, out-of-network care is still covered, but at a higher cost to those insured under the plan. Most EPO plans have no provision for coverage of health care outside the EPO network.

21. Silent PPO
Happens when PPO payer buys another existing PPO without telling the provider of the change
Billing issues
Determining the PPO
Contacting payer
Claim submission
Payment
Carefully review the insurance card
Carefully review the EOB

22. BREAK
10 MINUTES

23. MEDICAL REVIEW
Medical review is the formal system that insurance payers use to monitor the accuracy of claims submission, medical necessity of services rendered, and clinical quality outcomes of patients.

24. Quality Improvement Organization (QIO)
Contracted with CMS
Reviews medical necessity, reasonableness, appropriateness, and adequacy of patient care
Evaluates the quality and efficiency of services rendered by the physician
Carolina Center for Medical Excellence is the QIO for North and South Carolina
Quality Improvement Organizations (QIOs) monitor the appropriateness, effectiveness, and quality of care provided to Medicare beneficiaries. They are private contractor extensions of the federal government that work under the auspices of the U.S. Centers for Medicare and Medicaid Services (CMS).
The Carolinas Center for Medical Excellence (CCME) is the designated Quality Improvement Organization (QIO) for both North and South Carolina. The QIO Program ensures the quality, effectiveness, efficiency, and economy of health care services provided to people with Medicare.

25. Utilization Review/Utilization Management
Evaluation of how services are being used and delivered
Determination of medical necessity for tests and procedures
Precertification
Preauthorization
Pre-, post- reviews
A utilization review is a procedure to evaluate how services are being used and delivered, to confirm that they are being utilized in a way which is efficient and cost effective.
A utilization can occur before treatment is provided, during treatment, or after. Certain types of treatment may trigger automatic reviews, while others may be reviewed due to the specifics of the case, the patient, or the facility.
In a utilization review, a person or panel of people sits down to go over the specifics of the case and the recommended treatment. For example, if a patient has cancer, the board will discuss the type of cancer, the staging, the age of the patient, the prognosis, and so forth. The board will also discuss the treatment recommended by a doctor. They must decide in the utilization review whether or not the treatment fits in with established treatment guidelines, and they must consider whether it is necessary or appropriate.

26. Preauthorization and Patient Referrals
Formal referral
Authorization request required by MCO
Completed via telephone, faxed form, or online
Direct referral
Patient makes his own appointment
Formal referral not required
Verbal referral
Primary care physician refers patient to a specialist
PCP makes the appointment for the patient, or notifies specialist that patient will be calling
Self-referral
Patient refers himself to a specialist
Some managed care plans require preauthorization for certain services, or referral of a patient to see a specialist. There are four different types of referral: formal, direct, verbal, and self
Patients may not know the referral or authorization requirements of their insurance plan. No matter our position within the practice, we should advise the patient at every level to contact their insurance to find out their benefits and referral/authorization requirements.

27. Recap There are many types of health insurance payers
BCBS is a national federation
Managed care plans are prepaid health care programs in which a specified set of health benefits are provided to the patient
Primary care providers act as gatekeepers who control patient access to specialists and diagnostic services
Medical review is a process to ensure that appropriate treatments is being provided to the patient
Preauthorization and referral requirements are the responsibility of both the patient and the provider

28. READ CHAPTER 12 MEDICARE WORKBOOK ASSIGNMENT Part I Fill in the Blank
All questions
Part II Multiple Choice
Part III True/False