Introduction to Physician Billing

1. Introductionto Physician Billing Student Health Center

2. UA SHC Current Billing Process • Self-pay patients: The fee for service is sent directly to Student Receivables to be added to the student’s UA bill. • Insurance patients: Coverage is verified and the service will be filed to the insurance carrier. • Balance after insurance: The patient out of pocket expense after insurance is sent directly to Student Receivables to be added to the student’s UA bill. • Usage is rolled up into tuition and is not a separately identifiable access fee. UA SHC is funded by a mix of state appropriations and medical insurance collections.

3. Example of Revenue/ Collections • How do the results of providing student services and accepting insurance look? • For a campus with roughly 33,000 students: (Annual) • 30,000 visits- by physicians or physician extenders • $4,100,000 in charges • $3,100,000 in collections

4. Insurance Payor Mix

5. Staffing Model • Based on volume of 30,000 plus visits annually, the staffing and associated annual salary plus benefits may be as follows: • Office Manager ($45,000)- Supervision of staff, insurance credentialing, liaison and support to the student health center physicians and staff, and back-up for billing functions. • Medical coder ($39,000)- Responsible for billing services and providing coding guidelines and assistance. • Insurance clerk ($36,500)- Responsible for following up on unpaid insurance claims. • Payment poster ($36,500)- Responsible for posting payments, adjustments and denials from patients and insurance carriers.

6. Introduction • What is Physician Billing? • The process of quantifying health care services to insurance carriers and other third party payors, along with patients, for reimbursement • Today you will learn basic skills that will provide a broad overview of the billing process for physician services in a practice setting

7. Vocabulary • CPT Code - code used to identify services provided to a patient • ICD-9 Code - code used to identify diagnoses presented and/or discovered while rendering services to a patient • CMS-1500 – form used to bill insurance carriers for professional services performed by a physician and/or other health care providers • EDI – Electronic Data Interchange • Clearinghouse – third party organization contracted by a provider to transmit and bill services to insurance carriers • Provider Contract – contract between a physician and/or other healthcare provider and an insurance carrier that details billing and payment relationship • Fee Schedule – Pre-set, agreed upon fee structure that insurance carriers use to reimburse providers for services provided to their beneficiaries

8. Vocabulary • Allowable – dollar amount an insurance carrier agrees to pay for a particular service; detailed by CPT code • Contractual Adjustment – difference between actual billed charge and allowable per payor fee schedule • Provider Number – personal identification number used by insurance companies to identify providers for reimbursement and other billing services • TIN – Tax Identification Number – issued by IRS to identify businesses for tax purposes; used by insurance carriers for claims processing • NPI – National Provider Identification number – unique identification number issued by CMS; will one day replace PIN numbers

9. Vocabulary • Audit Trail – report received from carrier detailing up-front rejections, by patient • Electronic Remittance – electronic payment file; used to post payments from carriers back into billing system • Explanation of Benefits – detailed listing of reimbursement for a particular patient(s) and service(s) provided • Copay– amount due from patient; per office visit • Deductible – portion of services that patient will be responsible before an insurance carrier begins reimbursing a provider • Varies from carrier to carrier • Deducted from allowed amount on contracted services

10. Where to start? Gather information • Does the patient have insurance? • If so, do we participate with the carrier? • Can we file the claim electronically? • If so, can we file directly to the carrier or will the claim have to go through a clearinghouse • What can we expect for reimbursement? • How does the carrier pay? • % of billed charges • UCR • Fixed Fee Schedule

11. Patient Information • In order to file claims to an insurance carrier, demographic data must be obtained from each patient • Name, Date of Birth, SSN (optional), address, phone number, insurance carrier information • Signed Authorization to bill insurance carrier for reimbursement • Agreement to pay all charges not covered by insurance carrier, along with any copayment and/or deductible • Copy of Health Insurance Card • Contains important data needed to file claim • Policy number, Insured name, Group number, claims address, precertification requirements

12. Patient Information

13. General Guidelines of Evaluation and Management Billing • “If it isn’t documented, it hasn’t been done” is an adage that is frequently heard in the health care setting.

14. Charge Entry • Office Visit Codes • New Patient Office Visits • 99201 - 99205 • Established Patient Office Visits • 99211 - 99215 • Office Consultations (not recognized by Medicare) • 99241 - 99245

15. Charge Entry • Other CPT Classifications • Laboratory Tests – 80000-89999 • Radiology – 70000-79999 • Minor office procedures – 10000-17999 • I & D • Simple repairs • Wart and Lesion removal • Vaccines and Immunizations – 90000-90799 • Psychiatric Services – 90800-90911

16. Diagnosis Codes • All ancillary codes – Laboratory, radiology, immunizations, etc. – must be supported by a valid diagnosis in order for the service to be reimbursed by an insurance carrier or other third party carrier • Screening Codes – V codes – classification of codes used to identify personal history of conditions and diseases; also used to identify tested ordered for screening purposes • Accident Codes – E codes – used in conjunction with injury diagnoses to further explain the reason for a particular treatment

17. Diagnosis Coding • ICD-9 codes are used to identify diagnoses presented by the patient and/or discovered during treatment by the provider • All services provided must have a ICD-9 code attached to the CPT code for reimbursement • ICD-9 codes are three (3) to five (5) digit alpha-numeric codes used to provide a description of the patient’s condition • ICD-9 – International Classification of Diseases, Ninth Revision

18. ICD-10 Transition: Bigger than Y2K! • ICD-10 will be implemented October 2014. This is one of the BIGGEST changes in healthcare in the next two years. It will radically change the way physicians code for services. • Analysts are advising physicians to keep up to 20% cash in reserves in preparation for reimbursement delays post 2014. • COST to Hospitals and Physicians: • $3,219 per in-patient hospital coder • $644 per outpatient coder • Department of Health and Human Services estimates a loss of up to $1.1 Million dollars by hospitals for denied claims and up to $9.4 million dollars for outpatient physicians by the end of the first implementation year. • Canada’s implementation of ICD-10 resulted in 50% PRODUCTIVITY SLOWDOWN in the first 6 months. 18-20% has never been regained!

27. Chart Reviews • UMC Coding Compliance Program • Sample of 20-30 charts are reviewed for coding compliance • Depending on the results of the chart review, as compared to pre-determined benchmarks, each provider will enter into a monthly, quarterly, or annual review rotation • Individual educational sessions will be held with each provider to review results and discuss any coding issues

28. Summary • Physician billing is a complex and unique process • The extensive & often complex billing process for health care is not found in any other industry • Electronic Health Record (EHR) software is designed to assist with billing. • Things to watch for over the next several years • Increased use of EHR • Continued reduction in reimbursement by Medicare & Medicaid • Quality Improvement and Pay-for-Performance measures linked to reimbursement

29. What happens if you get it wrong?? • Overcoding and Undercoding….. • Receive less payment than deserved for work performed. • Fines • Jail time

30. Valuable Websites! • CMS- Centers for Medicare and Medicaid • www.cms.gov • AAPC- American Academy of Professional Coders • www.aapc.com • RAC Monitor- Recovery Auditor Contractors • http://racmonitor.com

31. Any questions? • Allyson Welch • Director, Billing & Coding Compliance • amwelch2@cchs.ua.edu • 348.1257