Resources

A

ANSI ASC X12 – (American National Standards Institute Accredited Standards Committee X12) A standardized electronic data interchange (EDI) format used for transmitting healthcare claims and other administrative transactions.

Advance Beneficiary Notice of Noncoverage (ABN) – A form provided to Medicare beneficiaries before receiving services that Medicare is not expected to cover, allowing the beneficiary to decide whether to receive the services and accept financial responsibility.

Allowed Amount – The maximum amount an insurance payer will reimburse for a specific service, as determined by their contract with the provider or their fee schedule.

Appeal – A formal request to an insurance payer to reconsider a denied claim.

Assignment of Benefits (AOB) – An agreement signed by the patient that allows the insurance payer to send payments directly to the healthcare provider.

B

Bad Debt – An amount owed to the practice that is considered uncollectible and written off after reasonable collection efforts.

Beneficiary – An individual who is eligible to receive benefits under an insurance policy.

Beneficiary Liable Amount – The amount that a beneficiary is legally responsible for paying.

Billable Time – The time spent treating a patient.

Bundling – The practice of combining multiple related services into a single billing code.

C

Capitation – A payment arrangement in which a provider is paid a fixed amount per patient, regardless of the number of services provided.

Charge Capture – The process of accurately recording all services provided to a patient to generate a bill.

Charge Description Master (CDM) – A comprehensive list of all services, procedures, and supplies that the clinic provides, along with their associated charges and codes.

Claim – A request for payment that is submitted to an insurance payer for services provided to a patient.

Claim Adjustment Reason Code – A standard code that provides details on why a claim or service line was paid differently than it was charged.

Clean Claim – A claim that is submitted without errors or omissions and can be processed and paid promptly by the insurance payer.

Clearinghouse – An intermediary that receives claims from healthcare providers, scrubs for errors, and transmits them to insurance payers.

Coinsurance – The percentage of the allowed amount that a patient is responsible for paying after the deductible has been met.

Coordination of Benefits (COB) – The process of determining which insurance payer is primary and which is secondary when a patient has multiple insurance policies.

Copayment (Copay) – A fixed dollar amount that a patient is responsible for paying at the time of service.

Coverage – The amount of your bill that the insurance company will pay and under what circumstances they will pay. Coverage varies greatly from policy to policy.

CPT Code (Current Procedural Terminology) – A standardized coding system used to describe medical, surgical, and diagnostic procedures and services.

Credentialing – The process of verifying a healthcare provider’s qualifications and ensuring that they meet the requirements to participate in an insurance payer’s network.

D

Denial – Refusal by an insurance payer to pay a claim.

Denial Management – Address denied claims and appeal when necessary.

Diagnosis Code (ICD-10) – A standardized coding system used to classify diseases, injuries, and other medical conditions.

Direct Treatment – Refers to the time spent by the therapist providing skilled therapy services directly to the patient, such as manual therapy, therapeutic exercises, and neuromuscular re-education.

Downcoding – The practice of a payer reducing the level of service code billed by a provider to a lower-paying code.

DRG (Diagnosis-Related Group) – A system of classifying hospital cases into groups expected to consume similar hospital resources.

E

Electronic Data Interchange (EDI) – The electronic exchange of business documents between entities.

Electronic Funds Transfer (EFT) – The electronic transfer of funds from an insurance payer to a healthcare provider’s bank account.

Electronic Health Record (EHR) – A digital record of a patient’s medical history, including diagnoses, treatments, and medications.

Electronic Remittance Advice (ERA) – An electronic document that provides details about how a claim was processed and paid by an insurance payer.

Explanation of Benefits (EOB) – A document that is sent to a patient by their insurance payer that explains how their claim was processed and what portion of the charges they are responsible for paying.

F

Fair Debt Collection Practices Act (FDCPA) – A federal law that regulates the conduct of debt collectors and protects consumers from abusive or unfair collection practices.

Fee Schedule – A list of the maximum amounts that a healthcare provider will charge for specific services.

Financial Responsibility – The amount the patient is responsible for.

Fraud – Intentional deception or misrepresentation that is made for the purpose of obtaining unauthorized benefits or payments.

G

Group Number – This number identifies the employer or group under which the patient is insured.

H

HCPCS Codes (Healthcare Common Procedure Coding System) – A standardized coding system used to identify medical equipment, supplies, and services that are not included in the CPT coding system.

Health Insurance Claim Form (HCFA-1500 or CMS-1500) – A paper or electronic form used to bill for healthcare services by non-institutional providers.  It’s used to bill for services provided to patients covered by Medicare, Medicaid, other government insurance plans, and all commercial payers.

HIPAA (Health Insurance Portability and Accountability Act) – A federal law that protects the privacy and security of patient health information.

HMO (Health Maintenance Organization) – A type of health insurance plan that requires patients to select a primary care physician (PCP) who coordinates their care.

I

ICD-10 Code – The International Classification of Diseases, Tenth Revision, is a globally recognized medical classification list to monitor global morbidity and mortality statistics.

Incident-To Billing – Billing for services provided by non-physician practitioners (NPPs) under the supervision of a physician.

Indirect Treatment – Refers to the time spent by the therapist on activities that are not directly related to the patient’s care but are necessary for the provision of skilled therapy services, such as modalities.

L

LCD (Local Coverage Determination) – A decision by a Medicare Administrative Contractor (MAC) regarding whether to cover a particular service.

M

MAC (Medicare Administrative Contractor) – A private healthcare insurer that has been awarded a contract by CMS to process Medicare claims in a specific geographic region.

Medical Necessity – The determination that a service is reasonable and necessary for the diagnosis or treatment of a patient’s medical condition.

Medically Unlikely Edit (MUE) – A claim processing edit that limits the number of units of a particular service that can be billed on a single date of service.

Modifier – A two-digit code that is added to a CPT or HCPCS code to provide additional information about the service that was performed.

N

NCD (National Coverage Determination) – A nationwide determination by CMS regarding whether to cover a particular service.

National Correct Coding Initiative (NCCI) – A set of coding edits that are developed by CMS to prevent improper coding and billing practices.

National Provider Identifier (NPI) – A unique identification number that is assigned to all healthcare providers in the United States.

Non-Covered Service – A service that is not covered by a patient’s insurance plan.

O

Out-of-Network – Refers to healthcare providers who do not have a contract with the patient’s insurance plan. Services from out-of-network providers may be subject to higher out-of-pocket costs.

Out-of-pocket expense – Non-reimbursable expenses that you pay, such as deductibles and copayments.

Out-of-pocket maximum – The amount that you have to meet in order for the insurance company to pay 100 percent of your policy’s benefits.

P

Participating Provider (PAR) – A healthcare provider who has a contract with an insurance payer to provide services at a negotiated rate.

Patient Collections – Manage patient balances and collect payments.

Patient Registration – Collect patient demographic and contact information.

Patient Responsibility – The portion of a medical bill that a patient is responsible for paying out-of-pocket (e.g., deductible, coinsurance, copay).

Payer – An organization (insurance company, government agency, or self-insured employer) that is responsible for paying healthcare claims.

Pay-for-Performance (P4P) – A reimbursement model that rewards healthcare providers for meeting certain performance metrics.

Place of Service (POS) – The site or location that a healthcare service is provided.

Policy – An outline that explains what the insurance company will pay for and how much of the bill is your responsibility.

PPO (Preferred Provider Organization) – A type of health insurance plan that allows patients to see any provider, but offers lower out-of-pocket costs for seeing providers who are in the plan’s network.

Premium – The amount that you have to pay each month to have insurance coverage.

Primary Insurance – The insurance payer that is primarily responsible for paying a patient’s medical bills.

Prior authorization – Requirement from the payer to approve the services billed prior to services being rendered.

Protected Health Information (PHI) – Any individually identifiable health information that is protected by HIPAA.

Q

Qualified Medicare Beneficiary (QMB) – A Medicare beneficiary who is also eligible for Medicaid assistance with their Medicare cost-sharing expenses.

R

Remittance Advice (RA) – A document that is sent to a healthcare provider by an insurance payer that provides details about how a claim was processed and paid.

Remittance Remark Codes – Alphanumeric codes used on the electronic remittance advice (ERA) to provide additional explanation for why a claim or service line was paid or denied in a certain way.

Revenue Cycle Management (RCM) – The process of managing all of the administrative and clinical functions that contribute to the capture, management, and collection of revenue for a healthcare organization.

Resource-Based Relative Value Scale (RBRVS) – A system used by Medicare to determine the payment amounts for physician services based on the resources required to provide those services.

S

Secondary Insurance – The insurance payer that is secondarily responsible for paying a patient’s medical bills after the primary insurance has paid its portion.

Secondary Payer – The insurance payer that is responsible for paying any remaining balance on a claim after the primary payer has paid its portion.

Stark Law – Prohibits a physician from referring designated health services payable by Medicare to an entity in which the physician has a financial relationship unless an exception applies.

Superbill – A document completed by a healthcare provider that contains the patient’s diagnosis, procedures and services, and charges.

T

Third-Party Administrator (TPA) – An organization that processes claims and manages benefits for self-insured employers.

Timed codes – Refer to services that are provided for a specific amount of time, such as therapeutic exercise or manual therapy, and are billed based on the total time spent providing the service.

Timely Filing – is the deadline for submitting a claim to a payer.

U

Unbundling – The practice of billing separately for services that are typically included in a single billing code.

Undercoding – Using a lower paying code than what was documented in the patient charts.

Untimed codes – Refer to services that are not provided for a specific amount of time, such as evaluation and management services or interventions that are not time-based.

Upcoding – Using a higher paying code than what was documented in the patient charts.