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HIM 2543 HEALTHCARE BILLING AND REIMBURSEMENT Key word ch 3
Chapter 3 Key Terms
Terms in this set (94)
Amount provider actually bills a patient, which may differ from the allowable charge.
The determination of the reimbursement payment based on the member's insurance benefits.
Enrollment of excessive proportion of persons with poor health status in a healthcare plan or healthcare organization.
Average or maximum amount the third-party payer will reimburse providers for the service.
Request for reconsideration of denial of coverage or rejection of claim.
Assignment of Benefits
1. Assignment of benefits is a contract between a physician and Medicare in which the physician agrees to bill Medicare directly for covered services, to bill the beneficiary only for any coinsurance or deductible that may be applicable, and to accept the Medicare payment as payment in full. Medicare usually pays 80 percent of the approved amount directly to the provider of services after the beneficiary meets the annual Part B deductible. The beneficiary pays the other 20 percent (coinsurance).
2. Contract between a health provider and a health insurer (such as Blue Cross and Blue Shield or Aetna) in which the provider directly bills the health insurer on behalf of the patient or client and the health insurer makes payment directly to the provider. The provider agrees to accept the insurer's allowance (allowable charge) as full payment for covered services, less the patient's cost sharing, such as
deductibles, co-payments, and coinsurance.
Healthcare service for which the healthcare insurance company will pay. See Covered service. **Specific service for which a healthcare insurance company will pay. See Benefit.
Total dollar amount that a healthcare insurance company will pay for covered healthcare services during a specified period, such as a year or lifetime.
Length of time that a health insurance policy will pay benefits for the member, family, and dependents (if applicable) (also known as policy limit).
Catastrophic expense limit
Specific amount, in a certain timeframe, such as one year, beyond which all covered healthcare services for that policyholder or dependent are paid at 100 percent by the healthcare insurance plan. See Maximum out-of-pocket cost and Stop-loss benefit.
Center of excellence
Healthcare organization that performs high volumes of a service with correspondingly high quality; often recognized by medical peers for its expertise, cost-effectiveness, and superior outcomes. Health insurers may negotiate discounted rates at the organization for the service. To receive full coverage for the service, insureds may be required to receive their service at the healthcare organization.
Member of a group for which the employer or association has purchased group healthcare insurance. See Insured, Member, Policyholder, and Subscriber.
Unique number that identifies the holder (enrollee, member, or subscriber) of a healthcare insurance policy (also known as identification number, member number, policy number, and subscriber number).
Certificate of insurance
Formal contract, between healthcare insurance company and individuals or groups purchasing the healthcare insurance, that details the provisions of the healthcare insurance policy (certificate of coverage, evidence of coverage, or summary plan description).
Request for payment, or itemized statement of healthcare services and their costs, provided by a hospital, physician's office, or other healthcare provider. Claims are submitted for reimbursement to the healthcare insurance plan by either the policy or certificate holder or the provider. Also called bills for Medicare Part A and Part B, services billed through fiscal intermediaries, and for Part B, physician or supplier services billed through carriers.
Documentation of supplemental information that assists in the understanding of specific services received by an individual and in the determination of payment (such as documentation that supports medical necessity).
Process of transmitting claims requesting payment to payers.
Request for payment that contains only accurate information (no errors in data).
Entity that acts as an intermediary between providers and payers and that converts health data in non-standardized formats, such as paper, into standardized electronic formats for processing. May also run software-based audits to verify compliance with payers' edits (internal consistency checks) and accuracy.
Cost sharing in which the policy or certificate holder pays a preestablished percentage of eligible expenses after the deductible has been met. The percentage may vary by type or site of service.
Consumer-directed (consumer-driven) healthcare plan (CDHP)
Form of healthcare insurance characterized by influencing patients and clients to select cost-efficient healthcare through the provision of information about health benefit packages and through financial incentives.
Contracted discount rate
Type of fee-for-service reimbursement in which the third-party payer has negotiated a reduced (discounted) fee for its covered insureds. See Discounted fee-for-service.
Coordination of benefits
Method of integrating benefits payments from all health insurance sources to ensure that payments do not exceed 100 percent of the covered healthcare expenses.
Cost-sharing measure in which the policy or certificate holder pays a fixed dollar amount (flat fee) per service, supply, or procedure that is owed to the healthcare facility by the patient. The fixed amount that the policyholder pays may vary by type of service, such as $20.00 per prescription or $15.00 per physician office visit.
Provision of a healthcare insurance policy that requires policyholders to pay for a portion of their healthcare services; a cost-control mechanism.
Health condition, illness, injury, disease, or symptom for which the healthcare insurance company will pay.
Prior healthcare coverage that is taken into account to determine the allowable length of pre-existing condition exclusion periods (for individuals entering group health plan coverage). Includes healthcare insurance through a group health plan or health maintenance organization (HMO), federal employees health benefits program, military healthcare plan (TRICARE), Indian Health Service (IHS), state high-risk pools, Medicare, Medicaid, coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), or other public health plan. Excluded from creditable coverage are accidental death and dismemberment plan, automobile medical payment insurance, disability insurance, and workers' compensation.
Reduction of waiting period for pre-existing condition based on previous creditable coverage. Credited coverage may be calculated on a day-by-day basis or other method that is at least as favorable to the individual. To receive credit for previous creditable coverage, the lapse (break) in coverage cannot exceed 63 days.
Annual amount of money that the policy-holder must incur (and pay) before the health insurance will assume liability for the remaining charges or covered expenses.
Medical tests, visits, and procedures to avert or prevent medical litigation, to reduce medical liability, and to avoid claims of malpractice. Defensive medicine is associated with increased costs of healthcare that do not benefit patients or clients.
An insured's spouse and unmarried children, claimed on income tax. The maximum age of dependent children varies by policy. A common ceiling is 19 years of age, with continuation to age 23 provided the child is a full-time student at an accredited school, primarily dependent on the covered employee for support and maintenance, and is unmarried. Some health-care insurance policies also allow same-sex domestic partners to be listed as dependents.
Claim that has a defect or impropriety. See Clean claim.
Algorithm in computer software applications that
is an internal check for consistency and accuracy.
Electronic claim submission
Paperless transmission of claims with health data in standardized format through computer software system or via the Internet. See Claim submission.
Electronic funds transfer (EFT)
Electronic exchange or transfer of money from one account to another through computer software systems.
Electronic remittance advise (ERA)
Electronic document that details the payer's determination of the payment, denial, or suspension of a provider's claim.
Set of stipulations that qualify a person to apply for healthcare insurance, examples include percentage of the appointment or duration of employment.
Language or statements within a healthcare insurance policy providing additional details about coverage or lack of coverage for special situations that are not usually included in standard policies. May function as a limitation or exclusion.
Initial process in which new individuals apply and are accepted as members (subscribers, enrollees) of healthcare insurance plans.
Evidence of insurability
Statement or proof of a health status necessary to obtain healthcare insurance, especially private healthcare insurance.
Situation, instance, condition, injury, or treatment that the healthcare plan states will not be covered and for which the healthcare plan will pay no benefits (synonym is impairment rider).
Explanation of benefits (EOB)
Report sent from a healthcare insurer to the policyholder and to the provider that describes the healthcare service, its cost, applicable cost sharing, and the amount the healthcare insurer will cover. The remainder is the policyholder's responsibility.
Flexible spending (saving) account (FSA)
Special account funded, by employees' contributions, to pay for qualified medical care and expenses. Employees determine the pretax deduction that is deposited into the account, up to the limit set by the employer. Funds from one FSA plan year cannot roll forward (carry over) to the next FSA plan year.
List of preferred drugs, including brand-name and generic.
Number identifying the employer, association, or other entity that purchases healthcare insurance for the individual members of the group. Individuals in the group have the same set of healthcare benefits.
Person who is responsible for paying the bill or guarantees payment for healthcare services. Patients who are adults are often their own guarantor. Parents guarantee payments for the healthcare costs of their children.
Health reimbursement arrangement (HRA)
Combination of an employee-benefit health insurance plan and a separate arrangement to reimburse employees for all or a portion of the qualified medical expenses not paid by the health insurance policy. Although often referred to as health reimbursement accounts, no separately funded account is required.
Health savings account (HSA)
Special pretax saving account into which employees, and sometimes employers, deposit money that subscribers can later withdraw to pay for qualified medical care and expenses. Unused funds can roll forward to subsequent years.
High-deductible health plan (HDHP)
Most common type of consumer-directed healthcare; insurance policy's deductibles are higher than traditional health-care insurance plans. Combined with health savings accounts or health reimbursement arrangements, HDHPs allow subscribers to pay for qualified medical care and expenses on a pretax basis.
An insurance plan (often a state health-care insurance plan) that covers unhealthy or medically uninsurable people whose healthcare costs will be higher than average and whose utilization of healthcare services will be higher than average. Also the term for the small group of unhealthy individuals who have the high probability of incurring many healthcare services at high costs.
Indemnity health insurance
Traditional, fee-for-service healthcare plan in which the policyholder pays a monthly premium and a percentage of the usual, customary, and reasonable healthcare costs, and the patient can select the provider.
Set of physicians, hospitals, and other providers who have formal agreements with health insurers under which patients and clients receive services at a discounted rate; preferred set of providers. See Out-of-network.
Individual or entity that purchases healthcare
insurance coverage. See Certificate holder, Member, Policyholder, and Subscriber.
Individual who does not enroll in a group healthcare plan at the first opportunity but enrolls later if the plan has a general open enrollment period.
Qualification or other specification that reduces or restricts the extent of the healthcare benefit.
Maximum out-of-pocket cost
Specific amount, in a certain timeframe, such as one year, beyond which all covered healthcare services for that policyholder or dependent are paid at 100 percent by the healthcare insurance plan. See Catastrophic expense limit and Stop-loss benefit.
Severe injury or illness (including pain); definition depends on the healthcare insurer.
Healthcare services and supplies that are proved or acknowledged to be effective in the diagnosis, treatment, cure, or relief of a health condition, illness, injury, disease, or its symptoms and to be consistent with the community's accepted standard of care. Under medical necessity, only those services, procedures, and patient care are provided that are warranted by the patient's condition.
An individual who has a pre-existing health condition, a chronic disease, or both, who cannot obtain healthcare insurance through the usual mechanisms because of his or her high risk and high cost.
Type of private insurance policy available for Medicare beneficiaries to supplement Medicare Part A and/or Part B coverage.
Individual or entity that purchases healthcare insurance coverage. See Certificate holder, Insured, Policyholder, and Subscriber.
Any change in behavior that occurs as a result of becoming insured.
Open enrollment (election) period
Period during which individuals may elect to enroll in, modify coverage, or transfer between healthcare insurance plans, usually without evidence of insurability or waiting periods (Medicare uses the term election).
Set of physicians, hospitals, and other providers who lack formal discounted-rate agreements with health insurers. Patients and clients receive no dis-count and pay increased cost-sharing. See In-network.
Payment made by the policyholder or member.
Plan in which the determination of the type of care,
provider, or healthcare service is made at the time (point) that the service is needed.
Binding contract issued by a healthcare insurance company to an individual or group in which the company promises to pay for healthcare to treat illness or injury (also known as health plan agreement and evidence of coverage).
Individual or entity that purchases healthcare insurance coverage. See Insured, Certificate holder, Member, and Subscriber.
See Prior approval (authorization).
Disease, illness, ailment, or other condition (whether physical or mental) for which, within six months before the insured's enrollment date of coverage, medical advice, diagnosis, care, or
Amount of money that policyholder or certificate holder must periodically pay a healthcare insurance plan in return for healthcare coverage.
Primary insurer (payer)
Entity responsible for the greatest proportion or majority of the healthcare expenses. See Secondary insurer.
Process of obtaining approval from a healthcare insurance company before receiving healthcare services (also known as pre-certification).
Prudent layperson standard
Standard for determining the need for emergency care based on what a prudent layperson (ordinary person) would believe or decide. A prudent layperson, possessing average knowledge about health and medicine, would expect that a condition could jeopardize the patient's life or seriously impair future functioning.
Report sent by third-party payer that outlines claim rejections, denials, and payments to the facility; sent via electronic data interchange.
Document added to a healthcare insurance policy that provides details about coverage or lack of coverage for special situations that are not usually included in standard policies. May function as an exclusion or limitation.
Group of people who will be covered by a healthcare insurance plan.
Secondary insurer (payer)
Entity responsible for the remainder of the healthcare expenses after the primary insurer pays. See Primary insurer
Special enrollment (election) period
Period during which individuals may elect to enroll in, modify coverage, or transfer between healthcare insurance plans, usually without evidence of insurability or waiting periods, because of specific work or life events, without regard to the healthcare insurance company's regular open enrollment period (Medicare uses the term election).
State healthcare insurance plan
Nonprofit association or governmental agency created by a state to provide healthcare insurance for people without coverage, usually because of pre-existing health conditions or chronic diseases; called health insurance association, comprehensive health insurance association, or simply high-risk pool. See Medically uninsurable
Specific amount, in a certain time-frame, such as one year, beyond which all covered healthcare services for that policyholder or dependent are paid at 100 percent by the healthcare insurance plan. See Maximum out-of-pocket cost and Catastrophic expense limit.
Individual or entity that purchases healthcare insurance coverage. See Certificate holder, Insured, Member, and Policyholder.
Additional healthcare insurance that fills in gaps (supplements) in comprehensive insurance or Medicare benefits; may be a cash benefit, per diem, or other form.
Level of healthcare benefit.
Process of identifying and classifying individuals' or groups' risk.
Usual, customary, and reasonable (UCR)
Type of retrospective fee-for-service payment method in which the third-party payer pays for fees that are usual, customary, and reasonable, wherein usual means usual for the individual provider's practice, customary means customary for the community, and reasonable is reasonable for the situation.
Time between the effective date of a healthcare insurance policy and the date the healthcare insurance plan will assume liability for expenses related to certain health services, such as those related to pre-existing conditions.
Program to promote health and fitness offered by employers and health insurance plans.
Supplemental type of insurance policy that covers the gaps in other types of health insurance. See Medigap and Supplemental insurance.
1. Amount deducted from a provider's claim; difference between the actual charge and the allowable charge. Some agreements between providers and healthcare insurance companies prohibit providers from charging patients this excess difference. 2. The action taken to eliminate the balance of a bill after the bill has been submitted and partial payment has been made or payment has been denied and all avenues of collecting the payment have been exhausted.
Preferred brand name
Non preferred brand name
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