Issues and Trends in HBI Ch1

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  • Teaching Notes:
    Suggest to students that they review the key terms in this chapter prior to reading the chapter or hearing the lecture. This will enhance their understanding of the material.
     
  • Learning Outcome: 1.1 Identify three ways that medical insurance specialists help ensure the financial success of physician practices.
    Teaching Notes:
     
    Ask students to identify and discuss how medical insurance specialists can ensure that medical providers remain compliant with health plans, managed care contracts, and federal and state regulations.
    Discuss why excellent communication skills are important for medical insurance specialists and how it can benefit an aging population and ensure the physician‘s financial success.
  • Learning Outcome: 1.1 Identify three ways that medical insurance specialists help ensure the financial success of physician practices.
    Teaching Notes:
     
    Discuss how medical insurance specialists can help ensure the physician’s financial success by using health information technology (HIT) and practice management programs (PMP) to organize, gather, record, store, and manage patient information. Discuss how this ensures insurance reimbursement.
    Discuss the how medical insurance specialists can benefit from the use of a combined PMP and an EHR in a single product called an integrated PM/EHR .
    Ask students to review page 6 and explain in their own words why computers are not more accurate than the individual who is entering the data and provide examples of how common errors can be prevented.
  • Learning Outcome: 1.2 Differentiate between covered and noncovered services under medical insurance policies.
    Teaching Notes:
     
    Ask students to describe and discuss the contractual relationship that exists among the patient (first party), the physician (second party), and the health plan (third party).
  • Learning Outcome: 1.2 Differentiate between covered and noncovered services under medical insurance policies.
    Teaching Notes:
     
    Ask students to define medical necessity and discuss how patients and providers are impacted by this requirement.
    Discuss why covered services require medical necessity in order to be paid for by an insurance company.
  • Learning Outcome: 1.2 Differentiate between covered and noncovered services under medical insurance policies.
    Teaching Notes:
     
    Ask students to identify and discuss why coverage for some preventive medical services is mandated by state or federal law. (examples: mammograms, contraception, routine physicals, child care, immunizations, etc.)
    Discuss ways that a medical insurance specialist can verify covered services and ensure the practice's financial success.
    .
  • Learning Outcome: 1.2 Differentiate between covered and noncovered services under medical insurance policies.
    Teaching Notes:
    Discuss how noncovered services are identified in the medical insurance policy.
    Ask students to identify and discuss examples of commonly covered and noncovered services.
  • Learning Outcome: 1.2 Differentiate between covered and noncovered services under medical insurance policies.
    Teaching Notes:
     
    Individual plans are commonly more expensive and cover less than group plans.
  • Learning Outcome: 1.3 Compare indemnity and managed care approaches to health plan organization.
    Teaching Notes:
     
    Discuss how indemnity plans help protect the patient and provider from financial losses.
    Fee-for-service means that payment is based on what the physician charges for services.
    .
  • Learning Outcome: 1.3 Compare indemnity and managed care approaches to health plan organization.
    Teaching Notes:
     
    A deductible is usually a fixed, annual figure that is defined when the policy is written. The payer pays nothing until this dollar amount has been paid by the insured/
    Provide students with a written example on the board or a handout that illustrates how an insured’s payments are calculated using a 75-25 coinsurance percentage. Compare the situations in which the deductible has and has not been met.
  • Learning Outcome: 1.3 Compare indemnity and managed care approaches to health plan organization.
    Teaching Notes:
     
    Ask students to discuss the benefits of managed care and why it has become the most common type of health insurance.
    Use Figure 1.2 to help explain the process of making a payment under a fee-for-service agreement.
    Discuss the advantages and disadvantages of physician participation (examples: more patients, faster reimbursements, but reduced fees).
  • Learning Outcome: 1.4 Discuss three examples of cost containment employed by health maintenance organizations.
    Teaching Notes:
     
    Use Figure 1.3 to help explain the process of making a payment under a capitation agreement.
    Capitated rates are based on factors such as the number of patients in the group and their average ages.
    The physician receives the same payment from the HMO per patient for each contracted period regardless of how many times the patient sees the physician.
  • Learning Outcome: 1.4 Discuss three examples of cost containment employed by health maintenance organizations.
    Teaching Notes:
     In some plans, the patient must pick a primary care physician, who is referred to as the “gatekeeper”; this physician directs all aspects of the patient’s care.
    Normally a copayment is a fixed portion of the bill paid by the patient; however, in some cases the “copay” may be a percentage of the total charges.
    Many procedures that once required an overnight hospital stay are now being done on an outpatient basis.
  • Learning Outcome: 1.4 Discuss three examples of cost containment employed by health maintenance organizations.
    Teaching Notes:
     A referral requires the permission of the insurance company and means that care for the patient’s condition is being turned over to another physician.
    Discuss how point-of-service plans have moved away from “gatekeeper” plans and how this impacts the patient’s ability to choose a physician, providing them more options.
  • Learning Outcome: 1.5 Explain how a preferred provider organization works.
    Teaching Notes:
     PPOs are the most common type of MCP.
    Providers sign contracts with the PPO and agree to accept reduced fees in exchange for a larger number of patients.
    Members are encouraged to see physicians within the plan but are free to choose from outside of the plan.
  • Learning Outcome: 1.6 Describe the two elements that are combined in a consumer-driven health plan.
    Teaching Notes:
     
    Ask students to describe the advantages of consumer-driven health plans (CDHPs) and how consumers may save on healthcare cost if they do not use their plan.
    Also note that the high deductibles required by a CDHP may impose payment difficulties for patients.
  • Learning Outcome: 1.7 Define the three major types of medical insurance payers.
    Teaching Notes:
     
    Ask students to identify various major private insurance companies they are familiar with.
    Discuss the differences among Medicare, Medicaid, TRICARE, and CHAMPVA. .
  • Teaching Notes:
     
    Review the Patient Protection and Affordable Care Act (ACA) feature on page 20. Discuss how these changes in healthcare impact all parties involved.
    Ask students to identify the major changes to preexisting guidelines.
    Optional Assignment:
    Ask students to research the timeline of the Affordable Care Act at www.healthcare.gov/law/timeline/ and write a paragraph on the current status of preventive healthcare benefits.  
  • Learning Outcome: 1.8 Explain the ten steps in the medical billing cycle.
    Teaching Notes:
     
    Ask students to identify and discuss the role that a medical insurance specialist can play to ensure that each step of the medical billing cycle is completed accurately.
    Discuss strategies to ensure that the medical billing cycle is completed accurately.
  • Learning Outcome: 1.8 Explain the ten steps in the medical billing cycle.
    Teaching Notes:
    Review the medical billing cycle shown on the inside front cover of the text with students.
    The average medical office works with nearly 20 different insurance companies.
    In small offices it may be the responsibility of the medical assistant to communicate with these insurance companies, both in writing and by telephone.
    .
  • Learning Outcome: 1.8 Explain the ten steps in the medical billing cycle.
    Teaching Notes:
     
    Diagnosis codes and procedures codes are entered into the appropriate boxes on the insurance claim. The ICD code must link with the CPT code to show medical necessity.
    Compliance with coding and billing rules is needed to ensure that payers will accept and pay claims.
    Most offices file claims for their patients.
    If the patient has more than one plan, claims must be prepared for each plan.
    Most claims are prepared electronically and submitted over the internet.
    .
  • Learning Outcome: 1.8 Explain the ten steps in the medical billing cycle.
    Teaching Notes:
     
    Ask students to identify and discuss the role that a medical insurance specialist can play to ensure that each step of the medical billing cycle is completed accurately.
    Discuss strategies to ensure that the medical billing cycle is completed accurately.
  • Learning Outcome: 1.9 Analyze how professionalism and etiquette contribute to career success.
    Teaching Notes:
    Ask students to define and discuss professionalism and why it is considered to be the most important characteristic that medical insurance specialists should have.
    Ask students to identify and discuss strategies to ensure that each staff member works with the highest level of ethics and professional etiquette.
    Note that each health care profession has its own code of ethics.
    For example, the Medical Assisting Code of Ethics can be found at the AAMA website (aama-ntl.org).
    These ethics are not necessarily law; however, it is important for the well-being of the patient that these ethics be followed as if they were law.
  • Learning Outcome: 1.9 Analyze how professionalism and etiquette contribute to career success.
    Teaching Notes:
     
    Discuss how professionalism, ethics, and etiquette impact patients in a medical office and contribute to the success of a medical insurance professional.
    Ask students to describe why professional appearance, etiquette, and attire can impact a patient’s point of view about the provider.
    .
  • Learning Outcome: 1.10 Evaluate the importance of professional certification for career advancement.
    Teaching Notes:
    Ask students to identify and discuss the different certifications offered by professional associations.
    Note that for most health care professionals, CEUs are required to maintain certification.
    Discuss the benefits of becoming a certified professional.
  • Issues and Trends in HBI Ch1

    1. 1. CHAPTER 1 Introduction to the Medical Billing Cycle © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
    2. 2. Learning Outcomes 1-2 When you finish this chapter, you will be able to: 1.1 Identify three ways that medical insurance specialists help ensure the financial success of physician practices. 1.2 Differentiate between covered and noncovered services under medical insurance policies. 1.3 Compare indemnity and managed care approaches to health plan organization. 1.4 Discuss three examples of cost containment employed by health maintenance organizations. 1.5 Explain how a preferred provider organization works.
    3. 3. Learning Outcomes (continued) 1-3 When you finish this chapter, you will be able to: 1.6 Describe the two elements that are combined in a consumer-driven health plan. 1.7 Define the three major types of medical insurance payers. 1.8 Explain the ten steps in the medical billing cycle. 1.9 Analyze how professionalism and etiquette contribute to career success. 1.10 Evaluate the importance of professional certification for career advancement.
    4. 4. Key Terms • accounts payable (AP) • accounts receivable (A/R) • adjudication • benefits • capitation • cash flow • certification • coinsurance • compliance • consumer-driven health plan (CDHP) • copayment • covered services 1-4 • deductible • diagnosis code • electronic health records (EHR) • ethics • etiquette • excluded services • fee-for-service • healthcare claim • health information technology (HIT) • health maintenance organization (HMO) • health plan
    5. 5. Key Terms (continued) • indemnity plan • managed care • managed care organization (MCO) • medical billing cycle • medical coder • medical insurance • medical insurance specialist • medical necessity • network • noncovered services • out-of-network • • • • • • • • • • 1-5 out-of-pocket participation patient ledger Patient Protection and Affordable Care Act (ACA) payer per member per month (PMPM) PM/EHR policyholder practice management program (PMP) preauthorization
    6. 6. Key Terms (continued) • preexisting condition • preferred provider organization (PPO) • premium • preventive medical services • primary care physician (PCP) • procedure code • professionalism • provider 1-6 • referral • revenue cycle management (RCM) • schedule of benefits • self-funded (self-insured) health plan • third-party payer
    7. 7. 1.1 Working in the Medical Insurance Field 1-7 • Spending on healthcare in the United States is rising due to costs of advancing medical technology and an aging population • Many rewarding career paths in the healthcare field require knowledge of medical insurance and reimbursement options • Financial success of a healthcare facility depends on revenue cycle management (RCM) to maintain a balance of cash flow through management of accounts receivable and accounts payable • Excellent interpersonal skills assist in communication with everyone involved
    8. 8. 1.1 Working in the Medical Insurance Field (continued) 1-8 • Health information technology (HIT) incorporates practice management programs (PMPs) to streamline the process of scheduling, billing, and financial management • Electronic health records (EHR) are rapidly being adopted and many are integrated with the Practice Management Programs • Accuracy of the medical insurance specialist will contribute largely to the usefulness of emerging technology
    9. 9. 1.2 Medical Insurance Basics 1-9 • Medical insurance is a written policy stating terms of an agreement between a policyholder (an individual) and a health plan (an insurance company) • Health plans provide benefits (payments for medical services) • Health plans are often referred to as payers • A third-party payer is a private or government organization insuring or paying for healthcare on behalf of beneficiaries
    10. 10. 1.2 Medical Insurance Basics (continued) 1-10 • Insurance policies contain a schedule of benefits that summarizes payments that may be made for medically necessary medical services • Payer’s definition of medical necessity determines coverage and payment • A provider must meet the payer’s professional standards – Providers include physicians, nurse practitioners, physician assistants, therapists, hospitals, laboratories, long-term care facilities, and suppliers such as pharmacies and medical supply companies
    11. 11. 1.2 Medical Insurance Basics (continued) • Covered services may include primary care, emergency care, medical specialists’ services, and surgery • Preventive medical services include physical examinations, pediatric and adolescent immunizations, prenatal care, and routine screening procedures 1-11
    12. 12. 1.2 Medical Insurance Basics (continued) 1-12 • Noncovered services are those not included in a plan’s benefits • Excluded services may include: – Dental services, eye care, employment-related injuries, cosmetic procedures, or experimental/investigational procedures – Other specific items such as prescription drugs – A preexisting condition—a medical condition diagnosed before the policy took effect (rule may change under healthcare reform legislation)
    13. 13. 1.2 Medical Insurance Basics (continued) 1-13 • Group or individual policies available with varying restrictions and pricing • Other types of health-related insurance available – Disability insurance – Automotive insurance related to injuries – Workers’ compensation (determined by state law)
    14. 14. 1.3 Health Care Plans 1-14 • An indemnity plan provides protection against loss • Physicians send the health care claim—a formal insurance claim reporting data about the patient and services provided—to the payer on behalf of the patient • Patients pay a premium—the periodic payment required to keep the policy in effect
    15. 15. 1.3 Health Care Plans (continued) • Most policies have a deductible—the amount the insured pays for covered services before benefits begin • Coinsurance is the percentage of each claim paid by the insured • Some patients must pay out-of-pocket expenses prior to benefits • Fee-for-service is a retroactive charging method based on each service performed 1-15
    16. 16. 1.3 Health Care Plans (continued) 1-16 • Managed care offers a more restricted choice of providers and treatments in exchange for lower premiums, deductibles, and other charges • Managed care organizations (MCOs) establish links between provider, patient, and payer • Participation allows provider to contract with health plan to gain more patients and lower fees
    17. 17. 1.4 Health Maintenance Organizations 1-17 • A health maintenance organization (HMO) combines coverage of medical costs and delivery of healthcare for a prepaid premium • Capitation is a fixed prepayment to a provider for all medically necessary contracted services provided to each plan member – Per member per month (PMPM) is the capitated rate
    18. 18. 1.4 Health Maintenance Organizations (continued) 1-18 • A network is a group of providers having participation agreements with a health plan – Visits to out-of-network providers are not covered except for emergencies • HMOs often require preauthorization before the patient receives services • When HMO member sees a provider, they pay a specified charge called a copayment • HMO members may be required to choose a primary care physician (PCP) to direct all aspects of their care
    19. 19. 1.4 Health Maintenance Organizations (continued) 1-19 • Referral is transfer of patient care from one physician to another • Point-of-service (POS) plans allow visits to specialists in the plan’s network without a referral at one level of charge • POS plans also permit patients to receive medical services from non-network providers at a higher level of charge
    20. 20. 1.5 Preferred Provider Organizations 1-20 • A preferred provider organization (PPO) is an MCO where a network of providers supply discounted treatment for plan members – Most popular type of health plan – Creates a network of physicians, hospitals, and other providers with negotiated discounts – May require preauthorization – Controls use of services – Requires payment of a premium and often of a copayment for visits
    21. 21. 1.6 Consumer-Driven Health Plans • A consumer-driven health plan (CDHP) combines a high-deductible health plan with a medical savings plan – The health plan is usually a PPO with a high deductible and low premiums – The savings account is used to pay medical bills before the deductible has been met – Increases patient awareness of healthcare costs 1-21
    22. 22. 1.7 Medical Insurance Payers 1-22 • Three major types of medical insurance payers: 1. Private payers—dominated by large insurance companies 2. Self-funded (self-insured) health plans— organizations paying for health insurance directly by setting up a fund from which to pay 3. Government-sponsored healthcare programs— includes Medicare, Medicaid, TRICARE, and CHAMPVA
    23. 23. Healthcare Reform 1-23 • Patient Protection and Affordable Care Act (ACA) – – – – – – – Signed into law in 2010 and phasing in until 2014 Changes guidelines for preexisting conditions Young adults can remain on parent’s policy until 26 Payers cannot impose lifetime financial benefits limits 80 cents of every dollar must be spent on healthcare Preventive services for women included Many future benefits to patients, including major changes to Medicare and Medicaid
    24. 24. 1.8 The Medical Billing Cycle 1-24 • A medical insurance specialist is a staff member who handles billing, checks insurance, and processes payments • To complete their duties, medical insurance specialists follow a 10-step medical billing cycle – Series of steps leading to maximum, appropriate, timely payment
    25. 25. 1.8 The Medical Billing Cycle (continued) • • • • 1-25 Step 1 – Preregister patients Step 2 – Establish financial responsibility Step 3 – Check in patients Step 4 – Review coding compliance – A medical coder has specialized training to handle diagnostic and procedural coding – The patient’s primary illness is assigned a diagnosis code
    26. 26. 1.8 The Medical Billing Cycle (continued) 1-26 • Step 4 – Review coding compliance (continued) – Each procedure the physician performs is assigned a procedure code – Transactions are entered in a patient ledger—a record of a patient’s financial transactions • Step 5 – Review billing compliance – Compliance means actions that satisfy official requirements • Step 6 – Check out patients • Step 7 – Prepare and transmit claims
    27. 27. 1.8 The Medical Billing Cycle (continued) 1-27 • Step 8 – Monitor payer adjudication – Accounts receivable (A/R) is the monies owed to a medical practice – Adjudication is the process of examining claims and determining benefits • Step 9 – Generate patient statements • Step 10 – Follow up payments and collections
    28. 28. 1.9 Achieving Success • Professionalism is acting for the good of the public and of the medical practice • Medical ethics are standards of behavior requiring truthfulness, honesty, and integrity • Etiquette is made up of the standards of professional behavior 1-28
    29. 29. 1.9 Achieving Success (continued) • Requirements for success – Knowledge of medical language and coding – Communication skills – Attention to detail – Flexibility – Health information technology skills – Honesty and integrity – Team player • Attributes – Appearance – Attendance – Initiative – Courtesy 1-29
    30. 30. 1.10 Moving Ahead 1-30 • Continuing education required for certification so lifelong learning is needed • Certification is recognition of a superior level of skill by an official professional organization – Provides evidence to prospective employers that the applicant has demonstrated a superior level of skill on a national test
    31. 31. Summary 1-31
    32. 32. Summary 1-32
    33. 33. Summary 1-33

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