Ch9- Billing

Question 1

Cost-based fee schedules are developed using which of the following
a. RBRVS methodology
b. Total costs of every procedure or service listed in the CPT
c. Total cost of all the procedures the physician will perform
d. Malpractice insurance and office operating costs

Answer 1

c. Total cost of all the procedures the physician will perform

Question 2

What is the physician payment schedule determined by?
a. The physician
b. The insurance payer
c. The patient
d. The billing office manager

Answer 2

b. The insurance payer

Question 3

Given the following information:
National conversion factor $33.89
RVU value of $3.26
What is the provider’s fee schedule for 99203 (new patient office visit) using the above values?
a. $110.00
b. $34.00
c. $37.15
d. $74.30

Answer 3

a. $110.00

Question 4

What will happen if there is failure to post a contractual adjustment to a patient’s account?
a. It will have no effect on the patient’s account balance
b. It will have no effect on the A/R
c. It will leave a balance on the patient’s account that should not be there
d. It will decrease the workload of the billing staff

Answer 4

c. It will leave a balance on the patient’s account that should not be there

Question 5

Which of the following tasks is the most basic element of the billing process?
a. Claims follow up
b. Status report monitoring
c. Data entry
d. Patient follow up

Answer 5

c. Data entry

Question 6

What is the function of the claim scrubber?
a. To identify errors that will prevent a claim from being paid
b. To determine the reimbursement amount
c. To determine patient’s deductible amount
d. To identify practice management errors

Answer 6

a. To identify errors that will prevent a claim from being paid

Question 7

What are payments due from patients, payers, or other guarantors considered to be?
a. Active receivable
b. Accounts receivable
c. Allowed receivable
d. Accounts refundable

Answer 7

b. Accounts receivable

Question 8

Who is required to obtain a prior authorization for a service or procedure?
a. The parent or legal guardian of a minor
b. The patient
c. The patients insurance payer
d. The physician performing the procedure or service

Answer 8

d. The physician performing the procedure or service

Question 9

Who generates the remittance advice?
a. The front office reception staff
b. The medical assistant (MA) prior to patient being seen by the provider
c. The medical biller
d. The insurance payer

Answer 9

d. The insurance payer

Question 10

When a claim has been paid, where is an EOB sent?
a. To the clearinghouse
b. To the patient
c. To the provider
d. To the insurance company

Answer 10

b. To the patient

Question 11

A patient with ABC insurance is seen on May 1, and the claim is submitted on July 15 of the same year. Has the claim met the timely filing deadline?
a. Yes. All payers have the same timely filing deadline of one year from date of service.
b. No. All payers have a 30-day timely filing deadline.
c. Maybe. ABC’s timely filing policy should be reviewed to determine if the deadline was met.
d. Maybe. Prepare an appeal letter just in case the claim is denied.

Answer 11

c. Maybe. ABC’s timely filing policy should be reviewed to determine if the deadline was met.

Question 12

To submit claims data through EDI, what format must claim’s data be changed to?
a. Filled files format
b. Flat files format
c. Individual file format
d. Media file format

Answer 12

b. Flat files format

Question 13

A batch of claims is submitted to the clearinghouse for processing. The status report shows that 20 claims were acknowledged and forwarded on to the payer for payment and 10 claims were rejected. What is the next step the medical biller should take in this situation?
a. Contact the clearinghouse to determine why the 10 claims were rejected.
b. Contact the payer to determine the reason the claims were denied.
c. Notify the billing department manager of the rejected claims.
d. Review the status report to identify the reasons for rejection, make needed corrections and resubmit for payment.

Answer 13

d. Review the status report to identify the reasons for rejection, make needed corrections and resubmit for payment.

Question 14

When a claim is returned to the provider, at the clearinghouse level, what is it considered to be?
a. Denied
b. Pending
c. Rejected
d. Incomplete

Answer 14

c. Rejected

Question 15

What is the purpose of EHNAC?
a. To monitor coding practices of providers.
b. To develop standards for insurance payers.
c. To promote interoperability, quality service, and regulatory compliance.
d. To process claims in a timely manner.

Answer 15

c. To promote interoperability, quality service, and regulatory compliance.

Question 16

The billing department manager reviews the claims paid by HIJ insurance company. This would be considered which type of audit?
a. Pre-payment audit
b. Post-payment audit
c. Coding audit
d. Payer audit

Answer 16

b. Post-payment audit

Question 17

A physician writes an order for his patient to be admitted to the hospital for observation for suspected dehydration. The patient is observed for 8 hours and discharged to home following hydration therapy. What type of patient is this considered to be?
a. Outpatient
b. Inpatient
c. New patient
d. Established patient

Answer 17

a. Outpatient

Question 18

A family has health insurance coverage from both the father and mother. The father’s birthday is May 29, 1989, and the mother’s birthday is May 26, 1990. Which insurance would be primary for their three children?
a. The father’s insurance would be primary because he was born before the mother.
b. The mother’s insurance would be secondary because she was born after the father.
c. The mother’s insurance would be primary based on the month and day of her birthday.
d. The father’s insurance would be primary based on the month and day of his birthday.

Answer 18

c. The mother’s insurance would be primary based on the month and day of her birthday.

Question 19

Inpatient reimbursement is based on which of the following methodologies?
a. IPPS and APC
b. OPPS and MS-DRG
c. OPPS and APC
d. IPPS and MS-DRG

Answer 19

d. IPPS and MS-DRG

Question 20

Which is NOT used for data entry?
a. Maintaining an internal audit system
b. CPT® and ICD-10-CM codes to report the services for that encounter
c. Demographic information
d. Payments from insurance carriers

Answer 20

a. Maintaining an internal audit system

Response Feedback:
Rationale: The data entry process is critical in billing claims for encounters. Data entry is used for:
· Demographic information
· CPT®, HCPCS Level II, and ICD-10-CM codes to report the services for that encounter
· Payments and adjustments from insurance carriers

Question 21

Which regulation established claim standards for electronic filing requirements when a provider uses a computer with software to submit an electronic claim?
a. OIG Work Plan
b. Affordable Care Act (ACA)
c. Health Insurance Portability and Accountability Act (HIPAA)
d. Social Security Act

Answer 21

c. Health Insurance Portability and Accountability Act (HIPAA)

Response Feedback:
Rationale: Electronic claims can be submitted to a carrier from a provider’s office using a computer with software that meets electronic filing requirements as established by the HIPAA claim standards.

Question 22

Which method is the most common to calculate a fee schedule for physicians?
a. Private and government payers calculate the fee schedule
b. Creating a cost-based fee schedule
c. Fee schedule based on NCCI Edits
d. OIG Work Plan

Answer 22

b. Creating a cost-based fee schedule

Response Feedback:
Rationale: A fee schedule is a list of fees physicians establish as the fair price for the services they provide. There are many methods to calculate a fee schedule. The two most common methods include creating a cost-based fee schedule and creating a fee schedule based on the relative value units (RVUs) assigned by CMS.

Question 23

Why are status reports sent by payers?
a. To identify the status of pre-authorization in obtaining approval for procedures performed on a patient.
b. To identify the status of a claim and indicate if that claim has been accepted, adjudicated, and/or received by the payer.
c. To notify the provider that certain procedures are no longer covered under the payer’s policy for patients.
d. To notify the provider that a patient has met the deductible for that payer.

Answer 23

b. To identify the status of a claim and indicate if that claim has been accepted, adjudicated, and/or received by the payer.

Response Feedback:
Rationale: Status reports are the reports sent from the payers identifying the status of the claims that they received. The report will identify each claim with the patients’ names and date of service and whether they were accepted, adjudicated, and/or received by the payer.

Question 24

When a batch of claims is submitted electronically to a clearinghouse a report is sent to the provider. Which feedback does this report from the clearinghouse identify?
a. Shows improper Medicare payments paid to the provider.
b. All claims sent to the payer and all rejected claims.
c. Patient claims that will be sent to collections.
d. Patient claims that have not been paid within a certain time frame.

Answer 24

b. All claims sent to the payer and all rejected claims.

Response Feedback:
Rationale: A claim or batch of claims are submitted electronically to the clearinghouse. Typically, within 24 hours the clearinghouse will send a report to the provider. The clearinghouse report provides feedback on whether the claim was rejected or forwarded to the payer. The rejected claims can then be reviewed and corrected before being submitted to the insurance payer.

Question 25

Which of the following are verified by a claim scrubber? I. ICD-10-CM codes II. CPT®/HCPCS Level II codes III. Looks at procedure codes and diagnosis codes justifying medical necessity IV. Place of service V. NCCI Edits VI. Looks for trends in both claim scrubber edits and denials a. IV-VI b. III-V c. I, III, VI d. I-V

Answer 25

d. I-V Response Feedback: Rationale: The claim scrubber verifies CPT®/HCPCS Level II codes and ICD-10-CM codes. The scrubber looks at the procedure code and diagnosis code to justify the medical necessity of the procedure. Additional edits may include the gender, age, date of service, place of service, required modifiers and NCCI edits. The claim scrubber will also verify that the ICD-10-CM codes support medical necessity for LCD/NCD and identify bundled services if this is built into the system.

Question 26

Sally who works for Dr. X gets a written request from ABC Insurance for additional documentation to process a claim for Mrs. Wader on date of service 11/22/XXXX. What following actions should Sally do? a. Add a modifier to a CPT® code and resend the claim. b. Send the copy of the medical records just for that date of service to the insurance carrier along with the claim and remittance advice. c. Copy the ICD-10-CM and CPT® codes from the codebooks that were reported for Mrs. Wader’s visit on 11/22/XXXX along with the claim to the insurance carrier. d. Copy the whole medical record that includes all dates of service of Mrs. Wader’s office visits with Dr. X and send it to the insurance carrier.

Answer 26

b. Send the copy of the medical records just for that date of service to the insurance carrier along with the claim and remittance advice. Response Feedback: Rationale: When a biller receives a request for medical records, the following actions should be taken: 1. Review the medical record to verify the services billed are accurate. 2. Copy the medical record for the date of service requested. Only the information pertaining to the date of service for the claim should be sent to the insurance carrier due to the minimum necessary standards in HIPAA requirements. 3. Send the copy of the medical records to the insurance carrier along with the claim and remittance advice. 4. Make a note in the practice management system that the medical records were sent to the insurance carrier. Include the date of service in the note.

Question 27

Which is NOT a true statement about daily deposits? a. Keeping the checks and cash in the office for more than a day opens the practice up to liability for the cash and checks. b. Daily deposits should be made for the mail receipts and personal payment receipts. c. Daily deposits of the mail receipts and personal payment receipts should be balanced each day. d. There should be daily mail deposits and personal payment receipts balanced weekly.

Answer 27

d. There should be daily mail deposits and personal payment receipts balanced weekly. Response Feedback: Rationale: All the statements are true. Daily deposits should be made for the mail receipts and personal payment receipts. Keeping the checks and cash in the office for more than a day opens the practice up to liability for the cash and checks. Daily deposits of the mail receipts and personal payment receipts should be balanced each day.

Question 28

Mr. Cooper was in outpatient surgery for a hernia repair. During the surgery a complication occurs that requires Mr. Cooper to be admitted into the hospital. Which payment system will be used? a. Mr. Cooper was in outpatient surgery for a hernia repair. During the surgery a complication occurs that requires Mr. Cooper to be admitted into the hospital. Which payment system will be used? b. Inpatient Prospective Payment System (IPPS) c. Both OPPS and IPPS d. Ambulatory Payment Classification (APC)

Answer 28

b. Inpatient Prospective Payment System (IPPS) Response Feedback: Rationale: A patient may have an outpatient surgery, but then develops a complication that requires the patient to be admitted as an inpatient. The inpatient admission converts the outpatient procedure that would have been paid under the Outpatient Prospective Payment System (OPPS) to an inpatient admission, which is paid under the Inpatient Prospective Payment System (IPPS).

Question 29

Mrs. Jones went in for a surgical procedure and the claim was denied because the office did not obtain prior authorization. The carrier does not allow authorizations to be obtained after the procedure has been performed. What is done to recover any payment? a. Bill Mrs. Jones and she is responsible for payment. b. The provider is required to write off the balance. c. Bill Mrs. Jones for 20% of the service and write off the balance. d. Rebill the service with an authorization obtained for Mrs. Webster.

Answer 29

b. The provider is required to write off the balance. Response Feedback: Rationale: Insurance contracts and policies should be reviewed to determine when a prior authorization is required. If one is required and was not obtained, the service will not be covered by the insurance company. Furthermore, the patient is not responsible for payment of this service if the prior authorization was not obtained. Under these circumstances, the provider is required to write off the balance.

Question 30

Which of the following can be done to reduce payment delay? a. Wait for the clearinghouse to send you a status report. b. Verify patient’s insurance information on each patient visit. c. Always submit medical record documentation with every claim. d. Submit a paper and electronic claim for a patient’s visit.

Answer 30

b. Verify patient’s insurance information on each patient visit. Response Feedback: Rationale: One way to avoid payment delay is to verify the patient’s insurance information for every encounter. Ask to see the patient’s insurance card each time.

Question 31

Mrs. Fryer takes her son to the ED for an injured arm. Her son is covered by both parents. Mr. Fryer’s birthday is 10/14/1984 and Mrs. Fryer’s birthday is 6/10/1986. Under the birthday rule whose insurance plan will be primary? a. The parent’s birthday closest to the child’s birthday b. Mrs. Fryer c. Mr. Fryer d. Either one can be primary

Answer 31

b. Mrs. Fryer Response Feedback: Rationale: In this case, Mrs. Fryer’s insurance will be primary. According to the National Association of Insurance Commissioners, under the birthday rule, the health plan of the parent whose birthday comes first in the calendar year is designated as the primary plan. The year of birth is not a factor in this rule. The month and day are the only factors the health plan considers.

Question 32

Which is a TRUE statement when submitting electronic claims? a. When an electronic claim is rejected due to an error, the provider is notified more quickly than with paper claims. b. Error rates are higher in electronic claims vs paper claims. c. Electronic claims can only be submitted by the internet. d. An electronic claim has a longer turnaround time than a paper claim.

Answer 32

a. When an electronic claim is rejected due to an error, the provider is notified more quickly than with paper claims. Response Feedback: Rationale: When an electronic claim is rejected due to an omission or error, the provider is notified more quickly than with paper claims.

Question 33

What is a listing of every single procedure that a hospital can provide to its patients that are billed to payers? a. CMS-1500 claim form b. Chargemaster c. UB-04 claim form d. Charge Ticket

Answer 33

b. Chargemaster Response Feedback: Rationale: A hospital charge description master (CDM), also called a chargemaster, is a master price list of all services, supplies, devices, and medications charged for inpatient or outpatient services by a healthcare facility. It is similar to a charge ticket in the medical office, but much more extensive.

Question 34

When creating a fee schedule for a practice, which of the following can be used to set the fees? a. Relative Value Units (RVU) b. Local Coverage Determination (LCD) c. Current Procedural Terminology (CPT®) d. National Correct Coding Initiatives (NCCI)

Answer 34

a. Relative Value Units (RVU) Response Feedback: Rationale: A fee schedule is based on Relative Value Units (RVUs).

Question 35

Which of the following transmission media is NOT used for submitting electronic claims? a. Magnetic tape b. DSL c. Fax d. Internet

Answer 35

c. Fax Response Feedback: Rationale: Claims submitted by fax (facsimile) are not used for submitting electronic claims because the information that is exchanged did not originally exist in electronic form before the transmission.

Question 36

Dr. X has agreed with insurance carrier XYZ that he will receive only $75 for a particular procedure that he charges $100 for and he will write off the balance. What is the amount written off know as? a. Deductible b. Contractual adjustment c. Non-participating provider d. Balance billing

Answer 36

b. Contractual adjustment Response Feedback: A contractual adjustment is the amount that the provider agrees to accept as a participating provider with the insurance carrier. It is a part of a patient’s bill that a doctor or hospital must write-off (not charge for) because of billing agreements with the insurance company. Adjustments, or write-offs, are the dollars that are adjusted off a patient account for any reason.

Question 37

A clearinghouse is an entity that provides which of the following services? a. Pursues payments of debts owed by individuals or businesses. b. Explains insurance benefits, policy requirements, and filing rules to patients. c. Assists providers in the collection of appropriate reimbursement for services rendered. d. Converts nonstandard data received from payers to standard transaction data to meet HIPAA requirements.

Answer 37

d. Converts nonstandard data received from payers to standard transaction data to meet HIPAA requirements. Response Feedback: Rationale: A clearinghouse is an entity that processes or facilitates the processing of claims for providers and healthcare plans. Clearinghouses also convert nonstandard data received from payers to standard transaction data to meet HIPAA requirements. Clearinghouses can also offer other services such as claims status tracking, insurance eligibility determination, and secondary billing services.

Question 38

What is the result, when an insurance carrier has denied payment for a procedure that did not get prior authorization? a. Is written off by the provider. b. Is paid 20% by the patient. c. Will be paid at 50% by the insurance carrier. d. Can be billed to the patient for the full fee.

Answer 38

a. Is written off by the provider. Response Feedback: Rationale: Insurance contracts and policies should be reviewed to make sure if a prior authorization is required. If it is required and was not obtained, the service will not be covered. The patient is not responsible for payment of this service if the prior authorization was not obtained and the provider is required to write off the balance.

Question 39

Which is a FALSE statement regarding claim scrubbers? a. A claim scrubber reviews claims for key components after the claims are sent to an insurance company and denied. b. The claim scrubber can verify that an ICD-10-CM code(s) supports medical necessity for LCD/NCD and identify bundled services. c. Common edits that are identified by claims scrubbers are data entry errors. d. The claim scrubber verifies CPT®/HCPCS Level II codes and ICD-10-CM codes.

Answer 39

a. A claim scrubber reviews claims for key components after the claims are sent to an insurance company and denied. Response Feedback: Rationale: A claim scrubber is a software program that reviews claims for key components before the claims are sent to an insurance company.

Question 40

Which component is used in a standardized physician payment schedule utilizing a resource-based relative value scale (RBRVS)? a. Conversion Factor, Geographic Location, and Practice Expense b. Practice Expense, Patient Population Rate, and Professional Liability Insurance c. Professional Liability Insurance, Patient Population Rate, and Conversion Factor d. Practice Expense, Professional Liability Insurance, and Conversion Factor

Answer 40

d. Practice Expense, Professional Liability Insurance, and Conversion Factor Response Feedback: Rationale: The methodology is comprised of five components: physician work relative value units (work RVU), practice expense relative value units (PE RVU), professional liability insurance relative value units (PLI RVU), geographic practice cost index (GPCI), and the conversion factor (CF).

Question 41

Who can report services performed in a facility? a. Only hospitals b. Only outpatient facility c. Only providers d. Provider’s office and facility

Answer 41

d. Provider’s office and facility Response Feedback: Rationale: Provider’s offices and facilities both report services performed in the facility. The provider bills for the professional services he or she provides within the facility. The facility reports the use of the facility and the resources in the facility used to provide those services.

Question 42

What are payments due from patients, payers, or other guarantors that are owed to the practice for services rendered considered to be? a. Collections b. Bad Debt c. Accounts Receivable d. None of the above

Answer 42

c. Accounts Receivable Response Feedback: Rationale: Accounts receivable or A/R is money owed to the practice for services rendered and billed. Payments due from patients, payers, or other guarantors are considered accounts receivable.

Question 43

Which of the following documentation is NOT needed for an audit? a. CMS-1500 claim form b. Medical record c. Encounter form d. Explanation of Benefits

Answer 43

d. Explanation of Benefits Response Feedback: Rationale: In case of an audit, it is important to have all the documentation available to support the charges. The patient’s medical record, the CMS-1500 claim form, along with the encounter form needed to be reviewed. The encounter form will show the diagnosis code(s), procedure, supplies, and other services provided during the patient encounter. The CMS-1500 claim form will show if there is an issue between what is entered from the encounter form and what is displayed on the claim form.

Question 44

When an adjudication process has been finalized, the payer will send the remittance advice (RA) to? A. Patient B. Collection agency C. Provider D. Clearinghouse

Answer 44

C. Provider ## Footnote Rationale: Once an adjudication process has been finalized, the payer will send the remittance advice (RA) to the provider.