Employer-sponsored group health plans are organized by employers to provide heath care benefits to employees. The insurance coverage is purchased from an insurance carrier or managed care organization. Group health plans are subject to state laws for coverage and payment. Self-funded health plans are also organized by employers, but the employers insure the plan’s members themselves rather than buying insurance coverage. Self-funded plans often hire third-party administrators and have administrative services only contracts for tasks such as subscriber enrollment and claims processing. These plans are controlled by federal ERISA law rather than by state law.
Group health plans establish and regulate health plans for employees, deciding on basic plan coverage and optional riders; eligibility requirements; and premiums and deductibles. The federal COBRA and HIPAA laws must be observed by the plans to ensure portability and coverage as required
Under preferred provider organizations (PPOs), providers are paid under a discounted feefor- service structure. In health maintenance organizations (HMOs) and point-of-service (POS) plans, the payment may be a salary or capitated rate, depending on the business model. Indemnity plans basically pay from the physician’s fee schedule.
Consumer-driven health plans are intended to shift costs and responsibilities for health care decisions to consumers. A consumer-driven health plan combines a high-deductible health plan (HDHP) that is usually a PPO for catastrophic coverage with one or more employer or employee funding options for out-of-pocket medical expenses.
Three types of funding options are used for outof- pocket expenses in consumer-driven heath plans. A health reimbursement account (HRA) is set up by an employer to give tax-advantaged funds for employees’ expenses. Health savings accounts (HSA) and flexible savings accounts (FSA) both can be funded by employees and employers on a tax-advantaged basis. HSA funds can be rolled over and taken by the individual to another job or into retirement, like an IRA. FSAs do not roll over.
Participation contracts have five main parts. The introductory section provides the names of the parties to the agreement, contract definitions, and the payer. The contract purpose and covered medical services section lists the type and purpose of the plan and the medical services it covers for its enrollees. The third section covers the physician’s responsibilities as a participating provider. The fourth section covers the plan’s responsibilities toward the participating provider. The fifth section lists the compensation and billing guidelines, such as fees, billing rules, filing deadlines, patients’ financial responsibilities, and coordination of benefits.
Under participation contracts, most plans require copayments to be subtracted from the usual fees that are billed to the plans. To bill for elective surgery requires precertification (also commonly called preauthorization) from the plan. Providers must notify plans about emergency surgery within the specified timeline after the procedure.
Plan summary grids list key information about each contracted plan and provide a shortcut reference for the billing and reimbursement process, including collecting payments at the time of service and completing claims.
The medical billing process is followed to prepare correct claims. (a) The general guidelines apply to the preregistration process for private health plan patients, when basic demographic and insurance information are collected; (b) the financial responsibility for the visit is established by verifying insurance eligibility and coverage with the payer for the plan, coordinating benefits, and meeting preauthorization requirements; (c) copayments are collected before the encounter; (d) any other payments due at the end of the encounter, such as deductible, charges for noncovered services, and balances due, are collected according to the practice’s financial policy; (e) coding compliance is checked, verifying the use of correct codes as of the date of service that show medical necessity; (f) billing compliance with the plan’s rules is checked; and (g) claims are completed, checked, and transmitted in accordance with the payer’s billing and claims guidelines.
Under capitated contracts, medical insurance specialists verify patient eligibility with the plan because enrollment data are not always up to date. Encounter information, whether it contains complete coding or just diagnostic coding, must accurately reflect the necessity for the provider’s services.
