Becoming More Aware of the ACA/Medicaid Impact

on Insurance Billing

Presented by:

Beverly RemmOrion Healthcare Technology

Medicaid Background Affordable Care Act Overview ACA Medicaid Expansion and Coverage Myths & Facts in Billing Pre-Billing Process ICD-9, ICD-10, & DSM-5 Ongoing Billing Process Claim Submission

Objectives:

The main public health insurance program for people with low incomes.

Single largest source of health coverage in the U.S.

More than 66 million Americans with coverage – more than 1 in every 5 – at some point during the year.

Medicaid is administered by the states and financed by federal government.

Finances 16% of total personal health spending in the U.S.

Background on Medicaid

Facilitates access to care for beneficiaries, that connects with managed care plans and their networks of providers.

Prior to ACA, Medicaid coverage of low-income categories: Children Pregnant women Parents of dependent children Individuals with disabilities Individuals age 65 and older.

Limited eligibility for adults - non-elderly adults without dependent children were not eligible regardless of how low their income.

Medicaid Coverage

Enacted on March 23, 2010

Expanded the Medicaid eligibility to cover many uninsured Americans.

Determination on the individuals Federal Poverty Level.

Nearly all non-elderly adults with incomes at or below 138% of the FPL.

Estimated about $16,105 for an individual in 2014

Affordable Care Act (ACA)

2014 HHS Poverty Guidelines

Federal Poverty Levels

2014 POVERTY GUIDELINES FOR THE 48 CONTIGUOUS STATESAND THE DISTRICT OF COLUMBIA

Persons in family/household Poverty guideline

For families/households with more than 8 persons, add $4,060 for each additional person.

1 $11,670

2 15,730

3 19,790

4 23,850

5 27,910

6 31,970

7 36,030

8 40,090

Increase by 2.8 million adults with incomes between 100% and 138% FPL were eligible for premium subsidies to purchase coverage through Marketplace.  In April 1, 2014, there were 29 states covered children in families with income up to at least 250% FPL.

Which means Medicaid and CHIP typically cover more than 1 in every 3 children.

Affordable Care Act (ACA)

The gains in Medicaid and CHIP coverage of children are protected.

States are required to maintain eligibility thresholds for children.

Must be at least equal to those they had in place when the law was enacted, through September 30, 2019.

States must provide Medicaid coverage to children aging out of foster care, up to age 26.

Affordable Care Act (ACA)

Provides 100% federal funding of the expansion through 2016.

Gradually decline to 90% by 2020.

All states required to simplify and modernize their enrollment processes.

Created a new coordinated enrollment system for coverage through the new Marketplaces.

Affordable Care Act (ACA)

The Supreme Court ruling on the ACA in June 2012, made the Medicaid expansion optional for states.

Individual States and ACA

Regardless of whether they expand Medicaid or not:

All states are required to establish streamlined, coordinated, and automated Medicaid eligibility and enrollment systems to facilitate enrollment in Medicaid and promote continuity of coverage.

Provide new options and incentives to states to rebalance their Medicaid long-term care programs in favor of community-based services and supports rather than institutional care.

Allow states have unique financial and policy leverage to reform the systems of care.

Individual States and ACA

The ACA includes a range of new investments, demonstrations, and authorities designed to leverage Medicaid and other public insurance programs to drive reforms in health care delivery and financing.

These provisions have accelerated ongoing innovation in Medicaid programs

Involve a more central role for preventive and primary care, increased care coordination for beneficiaries with complex needs, and incentives for performance.

Designed to promote better models of care and cost-effective care, particularly for those with high needs and high costs.

Data and analysis on the impact of the changes and the models implemented will continue to provide a better understanding of the developments in the program unfolding at the federal and state levels.

Affordable Care Act Designs

Expanding access to health coverage through:

Individual mandate - requiring adults to have health insurance or pay a fine.

Employer mandate - requiring firms with 50 or more employees to offer coverage or pay a fine.

Health insurance exchange - each state is required to establish/accept a federal exchange so that individuals and small businesses can buy coverage.

Expansion of Medicaid - eligibility to cover greater numbers of lower-income people.

 

Affordable Care Act Provisions

Eligibility – Create a minimum Medicaid income eligibility level across the country.

Financing – Coverage fully funded by the federal government for three years.

Information Technology Systems and Data – Policy and financing structure designed to provide states with tools needed to achieve the immediate and substantial investments in information technology systems.

Coordination with Affordable Insurance Exchanges – Enables individuals and families to apply for coverage using a single application and have their eligibility determined for all insurance affordability programs through one simple process.

Benefits –Benchmark benefit or equivalent packages will be provided and includes the minimum essential benefits provided in the Affordable Insurance Exchanges.

Community-Based Long Term Services and Supports –Program and funding improvements to provide long-term care services and supports in their home community.

Affordable Care Act Provisions

Quality of Care and Delivery Systems – Improvements to make the quality of care and the method delivered while at the same time reducing costs.

Prevention – Promotes prevention, wellness and public health and supports health promotion efforts at the local, state and federal levels.

Children’s Health Insurance Program (CHIP) – Funding through 2015.

Dual Eligible – A new office will be created within the CMCS to coordinate care for individuals who are eligible for both Medicaid and Medicare.

Provider Payments – States will receive 100% federal matching funds for increase in payments.

Program Transparency – Promotes transparency about Medicaid policies and programs.

Program Integrity – Increase program integrity with standards for providers and payments.  

Affordable Care Act Provisions

Changes have an average increase of 73% in Medicaid payment rates for the affected primary care physician services.

Funding a vast expansion of community health centers and the health care workforce that staffs them.

Enabling health centers to expand the scope of services they provide, expected to double health centers’ patient capacity in the next five years.

  In 2012, Medicaid spending on services totaled about $415 billion.

States and the federal government share the cost of Medicaid.  

Affordable Care Act Finance

The expansion of Medicaid in participating states will lead to increased enrollment in Medicaid and to higher total Medicaid spending.  The federal government finances the vast majority of the costs for newly eligible Medicaid adults is 100% in 2014, 2015, and 2016.

Phasing down gradually to 90% in 2020 and future years. These states expect net savings, due to reduced state spending for uncompensated care and state-funded mental health and other programs. States that do not expand Medicaid will still see increased Medicaid costs due to increased participation

Those states will not receive the substantial federal funding provided with expanded coverage.

Affordable Care Act Finance

Current concerns regarding access in Medicaid:

Low fee-for-service payment rates in Medicaid discourage physician participation in the program.

Low physician participation impact the supply and distribution of physicians.

It was reported that 38 states experience challenges with sufficient provider participation due to overall provider shortages and low Medicaid payment rates.

  The Medicaid plans are responsible for providing all the services and for

establishing adequate provider networks.   The managed care plans – not states – set the payment rates for physicians and

other providers in their networks.

Thus, the adequacy of provider payment rates in Medicaid is increasingly a matter of managed care plans’ payment policies.

Affordable Care Act Finance

Current concerns regarding access in Medicaid:

State and federal enforcement of network adequacy standards to ensure access to care.

Inadequate access to behavioral health care is a particular concern.

Lack of access to behavioral health care can adversely affect management of their physical health conditions as well.

Low participation by psychiatrists and shortages of substance abuse treatment providers present challenges to ensuring access to behavioral health services.

Providers willingness to accept new Medicaid patients than new privately insured patients.

Affordable Care Act Finance

ACA mandating new demonstration models to test the effects of innovative approaches to paying for health services and delivering care. These models are intended to improve both quality and efficiency:

Bundled payments: A single payment for “bundles” rather than separate payments for each service. ◦ Intended to encourage better-coordinated and more efficient care and

eliminate ineffective and unnecessary treatments.

Value-based purchasing (VBP): An incentive-based approach ◦ Intended to reward performance based on selected measures.

Accountable care organizations (ACOs):◦ Groups of providers assuming responsibility for meeting quality and cost

goals.

Patient-centered medical homes: Primary care clinicians refer the patient to specialists. ◦ An approach to delivering high-quality, cost-effective care, for people with

chronic health conditions.

Affordable Care Act Moving Forward

Billing Myths & Facts

NPI Number

Enrollment

Fee Schedule

Financial Policy

Preparing to Bill to Medicaid & Insurance

Mandated by the Health Insurance Portability and Accountability Act of 1996 (HIPAA)

Issued by Center for Medicaid and Medicare (CMS)

A Unique 10 digit Identifier for healthcare providers (facilities and individuals)

National Provider Identifier Number (NPI)

• Licensed individuals and entities that provide health care services

• Providers that are going to bill for health care services

• Any health care provider that has a taxpayer identifying number.

Who Should NOT Apply for a Number?• Groups, partnerships, or corporations.

• Physicians who have opted out of government medical programs.

Who Should Apply for an NPI number?

Website: https://nppes.cms.hhs.gov/NPPES/

Online application or download formsHave your application information

ready

Receive your NPI number typically in 1-2 weeks

How to Apply for an NPI number

Provider Enrollment and Insurance Contracts

Every insurance company plan will have different requirements and process for Provider Enrollment.

• Application forms

• Copies of documentation

(example: W-9, license certification, etc.)

• Signed Provider Agreements

Provider Enrollment Process

Enrollment process includes documentation and instructions online.• Listing requirements• Steps for enrolling• Applications

Enrollment considerations:• Clients that have coverage • Volume of other participating providers

Provider Enrollment Assistance

In-network or contracted provider next steps:

• Review guidelines and requirements

• Billable and Payable Service Codes

• Current Fee Schedules

• Specialty Billing guidelines

• Claim Submission and timely filing limitations

Provider Enrollment Completion

Important Questions to ask your contracting or non/contracting insurance plan:

• How can I verify client eligibility?

• Do I need authorizations for services

rendered?

• What are the claims submission guidelines?

Provider Enrollment Completed

Determining your practice’s rates and financial policies

A fee schedule is “a complete listing of fees used by health plans to pay doctors or other providers.”

The CMS fee schedule is categorized per state & per individual service.

The CMS fee schedule is updated annually and the amount for any service will be based on the actual place of service address.

https://www.cms.gov/apps/physician-fee-schedule

Center for Medicare and Medicaid (CMS)Fee Schedule

Medicare is utilized by other companies will use to establish individual fee schedules.

Recommend adding at least 35% to what CMS lists as a reimbursement as your rate of service.

Fee Schedules are updated annually.

Insurance Companies and Managed Care Plans evaluate provider charges received before updating

Adjustments can be made to the fee schedule and reimbursements to be closer and comparable to what the providers are charging.

Why CMS?

1. What is the level of difficulty of the service I am providing?

2. The services you provide are such a value to your patients.

3. Look at any ancillary costs you have that help provide services for your patients.

4. Take into consideration any malpractice insurance that is paid. You want to make sure you are making more than what you are paying out.

5. Recognize the diversity of patients that you treat and what they can afford; your rates should be appropriate for all customers.

Questions to ask…..

Protecting Your Practice Consider creating a financial policy for your office or

practice.

A financial policy will outline the rules for patients when it comes to billing and payments.

This can help you receive the full compensation that is deserved for your services.

The financial policy should include information such as how insurance will be handled, payment options, sliding fee scales, collection procedures, co-pays, etc.

Financial Policy

Protecting Your Practice

Every patient should receive a copy of your financial policy.

Patients should sign a financial policy agreement.

A financial policy should outline and explain the expectations of your patients when it comes to patient accounts.

Anytime you update your policy you need to make your patient aware of any changes and they should sign a new agreement.

Financial Policy

A Promissory note: a signed agreement between the provider and the client.

Explains expectations who will pay for services and actions that will be taken if payment is not made.

Promissory Note should be kept in the client’s chart.

Financial Policy for Patient’s without Insurance

The waiver will be an agreement between the provider and the client.

Waiver should be used when an insurance company does not pay for out-of-network provider services.

Also when an insurance company pays at a lower rate for out of network providers.

This will let the client know that they might be responsible for the charges that are not reimbursed by the insurance company.

Out of Network Patient Wavier

Ensure that billing and financial policies are legal and non

fraudulent.

1. The same the rate must be charged for same service for all patients.

2. Do not discount patient balances without validity.

3. Collection policy needs to apply to all clients and customers.

4. Documentation for all services provided and billed.

Rules and Guidelines

Billing Options

State Software Programs◦ A software system offered by your State Medicaid to

submit provider billing and claim information

Outsource Services◦ A contracted service to track and submit your billing

and claims for Medicaid, insurance, etc.

Billing Software System

◦ A software application used to track and submit your

billing and claims for Medicaid, insurance, etc.

Options for your Billing Process

Pros

• Free software

• Enter only specific information needed by Medicaid

State Medicaid Software System: Pros vs. Cons

Cons

• Limited information output

• Duplication of data entry

• Extra time spent on support needs

What you should expect from your Billing Service Manage submission of all services to Medicaid Knowledgeable with State and Medicaid guidelines Assist with follow up on denied or unpaid claims Clear understanding of your agency’s goals and

needs Provide detailed reports for services and claims Work with insurance companies on claims issues

to ensure payment on claims

Outsourcing a Billing Service

What to look for in a Billing Software System HIPAA ready Patient Privacy Regular updates to software for industry

compliance Personal and reliable customer support Easy to use Electronic Claims Submission Experience in your specialty and services

Billing Software System

These are activities should be done prior to submitting claims for a client.

◦ Verify eligibility Client’s benefits and coverage Co-pays and Deductibles

◦ Obtain authorizations

◦ Secure billing information with insurance company Claims address and Electronic Payer Id Billable procedure codes

Pre-Billing Workout

Why verify Eligibility?

Does the client have active coverage?

Does the client need to pay you anything at the time of visit?

Will the insurance company be able to reimburse you for services?

Where should you submit the claims?

Verify Client Eligibility

Eligibility Verification Process:

1. Is the client active?2. Do they have coverage for the service being

provided?3. What is the effective date of coverage?4. What is the deductible? What as been met?5. Is there a maximum limit on visits or amount for the

service being provided?6. Co-pays7. Authorizations8. Verify Claims Submission

Verify Client Eligibility

Diagnosis Codes

International Classification of Diseases

Diagnosis classification system used in all US health care treatment settings.

Developed by the Center for Disease Control and Prevention

What is ICD?

◦The current DSM is in the 5th Edition, released in 2013.

◦DSM codes are not recognized for processing or reimbursement by health plans.

◦DSM-V changed formats to coordinate with ICD codes.

Diagnostic and Statistical Manual of Mental Disorders

Currently scheduled for October 1st, 2015, the current diagnosis code set, ICD-9, will be replaced with the ICD-10 code set.

◦ The format of diagnosis codes will change.

◦ The number of diagnosis codes will increase.

◦ Codes will be more defined and specific.

Changes in Diagnosis Codes

• Increases diagnosis codes from 13,000 to 68,000 codes.

• ICD-10-CM is for use in all U.S. health care settings.

• ICD-10-CM uses 3 to 7 digits instead of the 3 to 5 digits used with ICD-9-CM

ICD-10 CM (Clinical Modification)

Used for inpatient procedure coding,

hospital settings only

Includes facility procedure codes and increases the total content from 11,000 to 87,000 codes.

Uses 7 alphanumeric digits

ICD-10 PCS (Procedural Coding System)

• ICD-9 produces limited data about patients’ medical conditions and procedures.

• ICD-9 was published over 30 years ago. • ICD-10 provides more specific data about

medical conditions and procedures.

ICD-9 vs. ICD-10

3-5 digits 3-7 digits

First digit alpha First digit is alpha; or numeric Second digit is numeric

Digits 2-5 are numeric Digits 3-7 are alpha or numeric

ICD-9 and ICD-10 Comparisons

ICD - 9 ICD - 10

Examples of ICD-10 Codes

Description ICD-9 ICD-10

Bipolar Disorder, Depressive, Mild

296.51

F31.31

Cannabis Dependence, Continuous

304.31

F12.20

Dislocation of ankle 837 S93.04XA

Medicaid and Insurance Claim Submission

CPT: Current Procedure TerminologyHCPC: Healthcare Common Procedure Coding

Identifies the service(s) rendered on a claim.

Both code sets are maintained by the American Medical Association.

Designed to communicate uniform information about medical services and procedures.

Codes updated annually and new editions are released each October.

CPT / HCPC Codes

Patient information: ◦ Name, address, gender, date of birth, diagnosis

code

Insurance Information:◦ Name, address, gender, date of birth

Business and Provider Information:◦ Name, NPI number, Taxonomy number, address

Service Information: ◦ procedure code, date of service, charge amount

Submitting Claims

HCFA 1500 Claim form

Outpatient services

Example of Claim form

UB 04Claim form

Inpatient services

Example of Claim form

Version 5010

Current set of format standards to communicate electronic health information data.

Implemented January 1, 2012.

Infrastructure changes for preparation of the ICD-10 codes.

Electronic Claims

Mandated by HIPAA (Health Insurance Portability and Accountability Act)

ANSI ASCx12 (American National Standards Institute Accredited Standards Committee) Develops and maintains standards for the formats of electronic transactions.

CMS (The Center for Medicare and Medicaid)Responsible for compliance and implementation

Electronic Claims

NPI numbers: NPI numbers will be required for all providers and facilities

Taxonomy codes: Taxonomy code for all providers and facilities will be required and updated

Nine digit zip codes: Nine-digit zip code must be reported for Billing

Diagnosis Codes: ICD-10

Format and data changes Version 5010

Ready to Start Billing

NPI number

Provider Enrollment or Insurance Contracts

Determined rates for services

Financial policy established for your practice

Beginning to Bill:

Evaluate current procedure codes

Prepare for ICD-10

Train on billing tasks

Establish and implement billing process

Review Billing

Provide services to clients Track all services and payments

Submit claims

Receive reimbursement/remittance

Handle and collect on outstanding balances.

Follow up on unpaid or denied claims.

Billing Routine

Affordable Care Act –

Increase in clients with coverage Change in reimbursement rates Provider guidelines Documentation – Electronic Records

ICD-10 – October 1, 2015

Looking Forward