Billing Basics for Mental Health Professionals (1 CE Credit)

BILLING BASICS FOR MENTAL HEALTH PROFESSIONALS
Surviving & Thriving in the Era
of Health Care Reform
PRESENTERS
Richard Sethre, Psy.D., L.P.
Marjie Brinkman, Director, BillCare
SPONSORED BYwww.billcare.com

TODAY’S PRESENTERS
Richard Sethre, Psy.D., L.P.
Marjie Brinkman, Director, BillCare
Your Host:
Pat Stream, Director Customer Success, Procentive

HOUSEKEEPING
Questions During Webinar
Questions After Webinar
CE Credits

AGENDA
• Billing from the Perspective of a Provider
• Billing from the Perspective of a Billing Service
• Questions & Answers

LEARNING OBJECTIVES
To understand:
• the basic process of how claims are generated, submitted, and paid
• the basic pieces of data which must be accurately documented in order
to have a claim accepted
• the basic process of tracking payments
• how to respond to denied claims
• secondary claims, and how they are generated and
processed.

LEARNING OBJECTIVES
To enable you to:
• monitor your payment process
• have knowledgeable discussions with your billing staff and to interact
collaboratively
• work collaboratively with your billing staff to maximize your
payments (and income)
• assess whether you might want to do your own billing
• Even if you are employed, to be able to discuss billing issues
knowledgeably

LEARNING OBJECTIVES - summary
To understand:
1. Fundamental concepts/terminology
2. Technology
3. The process
4. “The devil is in the details” – what can, and will,
go wrong – what needs to be done for things to go
smoothly.

BASIC TERMINOLOGY
• Patient client, member or recipient
• Payer insurance company, Managed Care Organization (MCO)
• MHP Mental Health Provider/Professional, provider,
therapist, Qualified Health Provider (Medicare)
• Managed Care Organization (MCO)
• Primary insurance
• Secondary insurance

BASIC TERMINOLOGY (cont.)
• HCFA 1500 (or) 837P
• ERA/835 (Electronic Remittance Advice)
• Patient Responsibility (PR) Contractual Obligation (CO)
– Co-payment
– Co-insurance
– Deductible
• EOB (Explanation of Benefits)
• EFT (Electronic Funds Transfer)

FUNDAMENTALS
The member’s (not necessarily the patient) contract with the
MCO will determine:
• Medical necessity criteria
• Covered providers
• Covered benefits
• Rate of reimbursement
• Whether requested a benefit exception is possible and
whether retro requests are possible
• Provider and Agency contract with the payer
• Primary takeaway: READ AND KNOW YOUR CONTRACTS!

WHAT HAPPENS*
• A claim is created.
• The claim is submitted to a clearinghouse (only if payer can process
electronic claims).
• The clearinghouse evaluates whether it is complete.
• The claim is forwarded to the MCO.
• The MCO processes the claim.
• The MCO responds with an ERA/835 or EOB.
* the short version!

WHAT REALLY HAPPENS
• Billers need two data bases:
• Patient management program (demographics, insurance info, services
record)
• Billing program (for creating claims, submitting claims, tracking
the response of the MCO and whether the claim is paid,
creating and submitting billing statements to patients,
maintain record of payments)
• Patient management and billing programs may
be separate or integrated.

WHAT YOU & YOUR BILLER NEED
• Insurance companies with which you are contracted
• Current/accurate demographic information
• Establish a payment process
• whether you want to be paid by check or (preferably) “electronic
funds transfer” (ETF)
• Establish how to receive “electronic remittance
advice” documents (ERA/835)

ERA/835 DEFINITION
“An electronic remittance advice (ERA) is an electronic
data interchange (EDI) version of a medical
insurance payment explanation. It provides details
about providers' claims payment, and if the claims are
denied, it would then contain the required explanations.
The explanations include the denial codes and the
descriptions, which present at the bottom of ERA.”
Source: Wikipedia

ERA/835 DEFINITION (cont.)
• ERA are provided by plans to providers.
• U.S. standard ERA is HIPAA X12N 835
– HIPAA: Health Insurance Portability and Accountability Act
– X12N: insurance subcommittees of ASC X12
– 835: the specific code number for ERA, sent from insurer
to provider either directly or via a bank
(HealthPartners explains ERA/835 documentation in 21 pages!)

YOUR RESPONSIBILITIES
• You must have current and accurate info about your patients
(including any secondary policy)
– Name of member/policy holder
– Current policy ID, group number
– Current address, phone number
• May change at the start of the year*
• May change with change of marital status, work,
PMAP coverage*
* Patients often do not think to inform you of important changes.

YOUR BILLING STAFF’S RESPONSIBILITIES
• Use the information that you have provided to
create and submit claims in a timely manner.
• Keep track of the response, or lack of response,
to claims
• Process payments
• Send a bill to patients for their share of
the payment - optional

YOUR BILLING STAFF’S RESPONSIBILITIES
• Help you respond to “nonpayment” problems
• Process secondary claims
• To keep you informed about policy changes that
affect how claims are created, processed and paid
• MCOs may not inform you of policy changes
that affect how to complete the HCFA 1500 form
– (eg., Medicare - “none” for group number, hyphenated names)
• Check eligibility vs. benefits

HOW A CLAIM IS CREATED
• Provider provides a service
– Diagnostic Assessment, therapy, medication check, etc.
• Provider submits info about service to billing staff
– daily charges
• Using patient management data, a claim is created
using the HCFA form (or) 837P if electronic
• The claim is submitted electronically to a
clearinghouse

EXAMPLES OF CLAIM FORMS
HCFA 837P readable
837P raw

HCFA

837P raw

837P readable

HOW A CLAIM IS PROCESSED
• The clearinghouse checks to make sure that the HCFA form is
complete, and forwards the claim to the MCO
• The insurance company processes your claim, checking:
– Does the patient have current coverage?
– Is the provider is contracted?
– Is the service a covered benefit? Does it require prior authorization?
– If applicable, has the patient met the annual deductible?
– Does the patient have a copayment or co-insurance responsibility?

HOW A CLAIM IS PROCESSED (cont.)
• The insurance company responds (hopefully with
payment)-notifies you with an ERA/835, EOB to pt.
• If you are paid, a check or electronic funds transfer is
generated
• If not, a denial is issued and documented on the
remittance advice
• Or, the MCO may issue a “non-processed” response
– (e.g. patient does not have current coverage or provider is
not contracted)

• ERA/835 documents:
– Amount billed (your charge)
– Amount allowed (based on the MCOs fee schedule)
– Amount you need to write off, or your “contractual
obligation” (CO)
– Amount patient is required, by contract, to pay, or “patient
responsibility” (PR)
– Payment (from MCO, if any)

The reason for denial must be documented, but is usually
done in code,* the table listing the codes and the
verbiage or explanation may be attached, may be on the
back of the form, or may need to be accessed on the
company's webpage
– Patient is not eligible
– Service was not a covered benefit
– Service requires prior authorization
*seriously

If the patient has secondary insurance, the process is
repeated for a secondary claim, requiring:
– Info from primary remittance advice
– Amount allowed
– Amount paid
– Adjudication date
– CO and PR
Easy math, but also easy to get mixed up if you don't do it
regularly!

ERA 1 - SIMPLE

ERA 2 - SECONDARY

ERA 3 - COMPLEX

COMMON CLAIM PROBLEMS (NON-PAYMENT)
• Clerical Mistakes
– Name spelled wrong
– Wrong ID number
– Wrong number for CPT code
– Submitted to wrong MCO
– Bad math
• Eligibility problems
– Lapsed coverage

A FEW MCO FACTS
• BCBS uses Availity to manage claims and questions
• MHCP does not provide EFTs
– MHCP checks have different dates than on the ERA
• Medica/UBH/UHC/Optum
– Can be confusing as to which entity you are dealing with
• UCare does not provide ERA/835 reports*
– Have to log on to their provider portal regularly (does not apply to
vendors like BillCare)
*BillCare does receive UCare ERA’s

WHAT TO ASK A BILLING SERVICE
• Payment:
–By the hour?
–By percentage of claims submitted?
–By percentage of reimbursement collected?
–Does this include payments you collect (deductible,
copayment, coinsurance)?

WHAT TO ASK A BILLING SERVICE, con’t
• Checking eligibility vs. benefits:
–At intake?
–At the beginning of the year?
–For MA/PMAP, monthly (required by DHS contract)?

• Reports:
–What reports to they provide?
• Billing systems may provide many reports, not all
of which are needed by MHPs
• Recommended: periodic reports on large amounts
owed
–(over $200? over $1000?)

• Plan for responding to bad debt?
– Is there a written policy for managing bad debt?
– Does the billing staff call, and how many times?
– Do they notify you so that you can talk to the patient?
• Form letter, or letters, sent and documented?
– Will you use a collections agency?
– Who decides when to write off bad debt?

• Who receives payments from the payer - the billing
agency or you?
• Who has the administration privileges in the portals?
• Who is responsible for getting more Auths - if you pay
for this service what forms do you still have to fill out?
• How much access do you have to your data?

• How do you contact your billing agency and what is the
response time?
• What clearing house does your billing agency have a
contract
with or do they submit claims on portals?
• What happens with paper claims (HCFA's) and county
invoices
• How are paper EOB's processed?

FOLLOW UP
CE Credit Option $30
Survey will be emailed to you.
Additional Questions?
info@billcare.com

Billing Basics for Mental Health Professionals (1 CE Credit)

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