Chapter 7: Reimbursement Methodologies

Question 1

What is a claim?

Answer 1

Itemized statement of healthcare services and their costs provided by a hospital, physician’s office, or other healthcare provider; submitted for reimbursement to the healthcare insurance plan by either the insured party or by the provider.

Question 2

What is Fraud and Abuse?

Answer 2

The intentional and mistaken misrepresentation of reimbursement claims submitted to government-sponsored health programs.

Question 3

What is Medicare?

Answer 3

A federally funded health program established in 1965 to assist with the medical care costs of Americans 65 years of age and older as well as other individuals entitled to Social Security benefits owing to their disabilities.

Question 4

What is Auditing?

Answer 4

The performance of internal and/or external reviews to identify variations from established baselines.

Question 5

What is the Prospective Payment System (PPS)?

Answer 5

A type of reimbursement system that is based on preset payment levels rather than actual charges billed after the service has been provided.

Question 6

What is Medicaid?

Answer 6

An entitlement program that oversees medical assistance for individuals and families with low incomes and limited resources; jointly funded between state and federal governments.

Question 7

What is Public Assistance?

Answer 7

A monetary subsidy provided to financially needy individuals.

Question 8

What are the Centers for Medicare and Medicaid Services (CMS)?

Answer 8

The division of the department of Health and Human Services that is responsible for developing healthcare policy in the United States and administering the Medicare program and the federal portion of the Medicaid program.

Question 9

What is the Department of Health and Human Services (HHS)?

Answer 9

The cabinet-level federal agency that oversees all of the health-and human-services-related activities of the federal government and administers federal regulations.

Question 10

What are Indemnity Plans?

Answer 10

Health insurance coverage provided in the form of cash payments to patients or providers.

Question 11

What is Group Health Insurance?

Answer 11

A prepaid medical plan that covers the healthcare expenses of an organization’s full-time employees.

Question 12

What is Major Medical Insurance?

Answer 12

Prepaid healthcare benefits that include a high limit for most types of medical expenses and usually require a large deductible and sometimes place limits on coverage and charges.

Question 13

What is a Policy Holder?

Answer 13

An individual or entity that purchases healthcare insurance coverage.

Question 14

Who is an Insured?

Answer 14

A holder of a health insurance policy.

Question 15

Who is an Insurer

Answer 15

An organization that pays healthcare expenses on behalf of its enrollees.

Question 16

What is Coinsurance?

Answer 16

Cost-sharing in which the policy or certificate holder pays a preestablished percentage of eligible expenses after the deductible has been met.

Question 17

What are out-of-pocket expenses?

Answer 17

Healthcare costs paid by the insured after which the insurer pays a percentage of covered expenses.

Question 18

What is capitation?

Answer 18

A method of healthcare reimbursement in which an insurance carrier pre-pays a physician, hospital, or other healthcare provider a fixed amount for a given population without regard to the actual number or nature of the healthcare services provided to the population.

Question 19

What is Employer-Based Self-Insurance?

Answer 19

An umbrella term used to describe health plans that are funded directly by employers to provide coverage for their employees exclusively in which employers establish accounts to cover their employees’ medical expenses and retain control over the funds but bear the risk of paying claims greater than their estimates.

Question 20

What are Premiums?

Answer 20

Amount of money that a policy holder or certificate holder must periodically pay an insurer in return for healthcare coverage.

Question 21

What is Medicare Part A?

Answer 21

Hospital insurance.

Question 22

What is Medicare Part B?

Answer 22

Medical (physicians care) insurance.

Question 23

What is Medicare Part C?

Answer 23

Medicare Advantage.

Question 24

What is Medicare Part D?

Answer 24

Prescription drug program.

Question 25

What is Medicare Advantage?

Answer 25

Optional managed care plan for Medicare beneficiaries who are entitled to part A, enrolled in part B, and live in an area with a plan;

Question 26

What is the Medigap?

Answer 26

A private insurance policy that supplements Medicare coverage.

Question 27

What is TRICARE?

Answer 27

The federal healthcare program that provides coverage for the dependents of armed forces personnel and for retirees receiving care outside military treatment facilities in which the federal government pays a percentage of the cost.

Question 28

What is Worker’s Compensation?

Answer 28

The medical and income insurance coverage for certain employees in unusually hazardous jobs.

Question 29

What is Managed Care?

Answer 29

Payment method in which the third-party payer has implemented some provisions to control the costs of healthcare while maintaining quality care.

Question 30

What is a Health Maintenance Organization (HMO)?

Answer 30

Entity that combines the provisions of healthcare insurance and the delivery of healthcare services, characterized by an organized healthcare delivery system to a geographic area, a set of basic and supplemental health maintenance and treatment services, voluntarily enrolled members, and predetermined, fixed, periodic repayments for members’ coverage.

Question 31

What is a Preferred Provider Organization (PPO)?

Answer 31

A managed care arrangement based on a contractual agreement between healthcare providers and employers, insurance carriers, or third-party administrators to provide healthcare services to a defined population of enrollees at established fees that may or may not be a discount from usual and customary or reasonable charges.

Question 32

What is a Chargemaster?

Answer 32

A financial management form that contains information about the organization’s charges for the healthcare services it provides to patients.

Question 33

What is a Diagnosis-Related Group (DRG)?

Answer 33

A unit of case-mix classifications adopted by the federal government and some other payers as a prospective payment mechanism for hospital inpatients in which diseases are placed into groups because related diseases and treatments tend to consume similar amounts of healthcare resources and incur similar amounts of cost.

Question 34

What is the Omnibus Budget Reconciliation Act (OBRA)?

Answer 34

Federal legislation that required CMS to develop an assessment instrument to standardize the collection of patient data from skilled nursing facilities.