Understanding Hospital Billing and Coding Chapter 5

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Payment methods used by government programs to provide reimbursement to hospitals for outpatient and inpatient services.

APC, MS-DRG, and RBRVS

The OPPS was implemented in August 2000 by CMS to provide reimbursement for____________.

hospital outpatient services

A specified group of invoices or statements processed at one time is called a:

Batch

What computerized system is designed to capture charges for all services and items provided for the purpose of posting charges to the patient's account and billing those charges on the claim form?

Charge Description Master (CDM)

What is the payment system implemented in 1983 that bases reimbursement for hospital inpatient services on predetermined amounts?

Inpatient Prospective Payment System (IPPS)

Registration, posting charges, chart review and coding, preparing claim forms and patient invoices or statements for charge submission, and monitoring and follow-up on outstanding accounts are functions of this process.

Hospital billing

The department in the hospital generally responsible for chargemaster maintenance.

Health Information Management (HIM)

Methods used by government programs to provide reimbursement to hospitals for outpatient and inpatient services include:

APC, DRG, and RBRVS

What is the claim form used to submit charges for outpatient professional services provided by a hospital-employed provider?

CMS-1500

What coding systems are used for inpatient claims?

HCPCS, ICD-9-CM Volume I-III

Reimbursement methods commonly used by commercial payers for inpatient services include:

Fee schedule, UCR, case rate, per diem, and contract rate.

Name the organization that defines revenue code categories.

National Uniform Billing Committee (NUBC).

Diagnosis codes provide an explanation of the patient's condition or other reason for services, which is essential to establishing medical necessity. This statement describes the relationship between:

Diagnosis codes and medical necessity.

Examples of the categories of services for which hospitals submit facility charges are:

Outpatient services

OPPS is a Prospective Payment System (PPS) implemented in 2000 to provide reimbursement for hospitals.

Outpatient services

The payment method used by Medicare and other government programs to provide reimbursement for physician and some outpatient services is called a(an):

resource-based relative value scale (RBRVS)

The document prepared by payers that is sent to the hospital with payment is called:

Remittance advice (RA) or explanation of benefits (EOB)

Which phase starts the billing process and is critical to obtaining information required to submit claims to payers and bill patients?

Admission-Patient registration

The computerized system used by hospitals to inventory and record services and items provided in various locations in the hospital during a patient stay.

Chargemaster

How many fields does the CMS-1450 (UB-04) have on the form, referred to as form locators (FLs)?

81

T/F Case mix is a term used to describe the type of patient cases treated by the hospital.

True

T/F Functions of the billing process include registration, posting of charges, chart review and coding, preparation of claim forms and patient invoices or statements for charge submission, and monitoring of and follow-up on outstanding accounts.

True

T/F Ambulatory payment classification (APC) is the OOPPS reimbursement method used by Medicare and other government programs to provide reimbursement for hospital outpatient services.

True

T/F Participating provider agreements outline the terms and conditions of participation for hospitals and payers. Four common provisions covered in these agreements include patient care services, billing requirements, reimbursement, and standards of medical care.

False

T/F A claim that needs additional information and does not pass paper edits is a clean claim.

False

The payment method used by Medicare and other government programs to provide reimbursement for physician and some outpatient services is called a(an):

resource-based relative value scale (RBRVS)

The PPS used by government and other payers to provide reimbursement for hospital outpatient services where a fixed fee is paid on the basis of the procedure(s) performed.

Ambulatory payment classification (APC)

What is the payment system implemented in 1983 that bases reimbursement for hospital inpatient services on predetermined amounts?

Inpatient Prospective Payment System (IPPS)

What coding systems are used for inpatient claims?

HCPCS, ICD-9-CM Volume I-III

The document prepared by payers that is sent to the hospital with payment.

Remittance advice or explanation of benefits

HIM coding professionals review the patient medical record for the purpose of ________________ and _____________ charges, abstract and code the patient's diagnosis and significant procedures, and assign MS-DRG or APC groups.

identifying, verifying.

What computerized system is designed to capture charges for all services and items provided for the purpose of posting charges to the patient's account and billing those charges on the claim form?

Charge Description Master (CDM)

What is the claim form used to submit charges for outpatient professional services provided by a hospital-employed provider?

CMS-1500

Payment methods used by government programs to provide reimbursement to hospitals for outpatient and inpatient services.

APC, MS-DRG, and RBRVS

The ________ process involves all the functions required to prepare charges for submission to patients and third-party payers to obtain reimbursement.

Billing

Resource-Based Relative Value Scale (RBRVS) is the__________ used by Medicare and other government programs to provide reimbursement for physician and some outpatient services.

payment method

A claim that does not need to be investigated by the payer, passes all internal billing edits and payer-specific edits, and is paid without need for additional intervention is a ____________ ________________.

clean claim

The portion of a claim that the patient must pay is referred to as the ___________ _____________.

patient responsibility

Two claim forms used to submit claims to third-party payers are the ______________ and_______________.

CMS-1500, CMS-1450 (UB-04)

The ________ ____________ __________ Department uses information gathered during the patient stay to prepare appropriate documents required for charge submission.

Patient Financial Services (PFS)

Coding systems used to describe diagnosis
and procedures on the CMS-1450 (UB-04) are
_________________, for procedures and items, and __________________ for diagnoses.

HCPCS, ICD-9-CM

Reimbursement to the facility as agreed to by the facility and the payer.

Contract rate

A reimbursement method that provides payment based on an established fee schedule for each service.

Fee-for-service

A reimbursement method used by Medicare to determine payment for inpatient cases.

Medicare Severity-Diagnosis Related Group (MS-DRG)

A reimbursement method used by Medicare to determine payment for facility charges incurred during an ambulatory surgery case.

Ambulatory Payment Classification (APC)

A written agreement between the hospital and
a payer that outlines the terms and conditions of
participation for the hospital and the payer.

Participating provider agreement (PAR)

Computerized system used by the hospital to inventory and record services and items provided by the
hospital, commonly referred to as the chargemaster.

Charge Description Master (CDM)

Charges that represent cost and overhead for providing patient care services, including space, equipment, supplies, drugs and biologicals, and technical staff.

Facility charges

A document prepared by the payer that provides an explanation and details regarding the payer's payment determination for charges submitted.

Remittance advice (RA)

The process, commonly referred to as collections, that involves monitoring accounts that are outstanding and pursuing payment from patients and third party payers.

A/R management

T/F The purpose of the hospital billing process is
to obtain appropriate reimbursement for services
rendered.

TRUE

T/F Accurate completion of the claim form
helps to ensure accurate reimbursement.

TRUE

T/F Patients are considered third-party payers.

FALSE: A third-party payer is an organization or other entity that provides coverage for medical services, such as insurance companies, managed care plans, Medicare, and other government programs.

T/F The detailed itemized statement is an outline of a
ll services and items posted to the patient's account
during the patient's stay.

TRUE

T/F The Charge Description Master (CDM) does not include procedure codes.

FALSE: Items listed in the CDM are generally organized by code, service or item description, charge, and other information required for the submission of the hospital's charges.

T/F Ambulatory payment classification (APC) is the OOPPS reimbursement method used by Medicare and other government programs to provide reimbursement for hospital outpatient services.

TRUE

T/F A computer program called an encoder may be used to assist with code assignment.

TRUE

T/F Functions of the billing process include registration, posting of charges, chart review and coding, preparation of claim forms and patient invoices or statements for charge submission, and monitoring of and follow-up on outstanding accounts.

TRUE

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