CBCS — Certified Billing and Coding Specialist — Questions and Answers

Question 1: What should a billing specialist do when a prior authorization is approved but expires before the service is rendered?

Obtain a new or extended authorization before the service is rendered (Correct answer)
Bill the patient directly for the service
Proceed with the service and appeal if denied
Use the expired authorization number on the claim

Correct answer: Obtain a new or extended authorization before the service is rendered

If a prior authorization expires before the service is performed, a new or extended authorization must be obtained to ensure coverage.

Question 2: What is the purpose of a patient intake form during registration?

To create the superbill
To assign ICD-10 codes
To collect medical history, insurance data, and demographic information needed for billing and care (Correct answer)
To determine the patient's payment plan

Correct answer: To collect medical history, insurance data, and demographic information needed for billing and care

The patient intake form gathers demographics, insurance details, and medical history to support accurate billing, coding, and clinical care.

Question 3: What is a Certificate of Creditable Coverage and why is it relevant to billing?

A document certifying that a provider is credentialed with an insurance network
A certification that a claim has been reviewed and approved by the insurer
A document required when billing for experimental or investigational procedures
A document from a prior health plan confirming the length of previous creditable coverage, which can reduce pre-existing condition waiting periods under some plans (Correct answer)

Correct answer: A document from a prior health plan confirming the length of previous creditable coverage, which can reduce pre-existing condition waiting periods under some plans

A Certificate of Creditable Coverage documents a patient's prior continuous health insurance coverage. Under pre-ACA rules, it could reduce waiting periods for pre-existing condition exclusions under new employer group plans.

Question 4: What is the Stark Law (Physician Self-Referral Law) designed to prevent?

Physicians from referring patients to entities with which they have a financial relationship, unless an exception applies (Correct answer)
Physicians from billing more than the Medicare fee schedule
Physicians from accepting insurance from plans in which they are not contracted
Physicians from practicing in multiple states without proper licensure

Correct answer: Physicians from referring patients to entities with which they have a financial relationship, unless an exception applies

The Stark Law prohibits physicians from referring Medicare/Medicaid patients to entities for designated health services if the physician or an immediate family member has a financial relationship with that entity.

Question 5: A patient's insurance card shows a group number and member ID. What is the group number used for?

Determining the patient's deductible amount
Authorizing a referral
Identifying the employer-sponsored plan (Correct answer)
Identifying the individual patient

Correct answer: Identifying the employer-sponsored plan

The group number identifies the employer or group plan sponsor under which the patient's coverage is provided, while the member ID identifies the individual.

Question 6: Which government agency is responsible for enforcing HIPAA Privacy and Security Rules?

CMS
OIG
OCR (HHS Office for Civil Rights) (Correct answer)
CDC

Correct answer: OCR (HHS Office for Civil Rights)

The HHS Office for Civil Rights (OCR) is the primary enforcer of HIPAA Privacy and Security Rules.

Question 7: A patient with a Preferred Provider Organization (PPO) plan chooses to see a specialist who is not in the PPO network. Which of the following outcomes is most likely?

The insurance plan will deny the claim entirely because the provider is out-of-network.
The patient must first get a referral from their PCP for the services to be covered.
The patient's services will be covered at the same rate as an in-network provider.
The patient will likely have a higher coinsurance or copayment and a separate, higher deductible for out-of-network services. (Correct answer)

Correct answer: The patient will likely have a higher coinsurance or copayment and a separate, higher deductible for out-of-network services.

PPO plans offer members the flexibility to see out-of-network providers. However, this flexibility typically comes at a higher cost to the patient in the form of increased cost-sharing responsibilities (copayments, coinsurance, and deductibles) compared to using in-network providers.

Question 8: What is a HIPAA breach and what are the notification requirements?

Any unauthorized viewing of PHI by a non-clinical staff member, requiring immediate patient notification
An impermissible acquisition, access, use, or disclosure of PHI that compromises its security or privacy, requiring notifications to individuals, HHS, and potentially the media (Correct answer)
Only a cyberattack that exposes ePHI to external hackers, requiring law enforcement notification
Any accidental mailing of a bill to the wrong address, requiring no notification

Correct answer: An impermissible acquisition, access, use, or disclosure of PHI that compromises its security or privacy, requiring notifications to individuals, HHS, and potentially the media

A HIPAA breach is an impermissible use or disclosure of unsecured PHI that is presumed to be a breach unless a risk assessment shows low probability that PHI was compromised. Notification to affected individuals, HHS, and (for large breaches) media is required.

Question 9: When coding a fracture in ICD-10-CM, what information is needed to select the correct 7th character?

The encounter type (initial, subsequent, sequela), healing status for subsequent encounters, and for open fractures, the Gustilo classification (Correct answer)
The patient's age and whether surgery was performed
Only whether the fracture is complete or incomplete
Only the bone that was fractured and the fracture type

Correct answer: The encounter type (initial, subsequent, sequela), healing status for subsequent encounters, and for open fractures, the Gustilo classification

Fracture coding requires the 7th character to reflect: (1) whether it is an initial encounter (A=closed, B=open type I/II, C=open type IIIA/B/C), (2) subsequent encounter healing status (D=routine, G=delayed, K=nonunion, P=malunion), or (3) sequela (S).

Question 10: Which section of CPT covers anesthesia services?

10004–69990
90281–99199
00100–01999 (Correct answer)
70010–79999

Correct answer: 00100–01999

CPT codes 00100–01999 cover anesthesia services.

Question 11: Which of the following best describes the concept of 'minimum necessary' under HIPAA?

Patients must provide only the minimum required consent for treatment
Covered entities must use or disclose only the minimum amount of PHI needed to accomplish the intended purpose (Correct answer)
Healthcare providers must collect the least amount of patient information possible at registration
Insurance companies must pay at least the minimum required reimbursement

Correct answer: Covered entities must use or disclose only the minimum amount of PHI needed to accomplish the intended purpose

The minimum necessary standard requires covered entities to make reasonable efforts to limit PHI use and disclosure to what is necessary to accomplish the intended purpose.

Question 12: In medical documentation, 'acute' vs. 'chronic' affects ICD-10-CM coding because:

Only chronic conditions are coded
Chronicity is not coded
They share the same code
They have different code assignments (Correct answer)

Correct answer: They have different code assignments

Acute and chronic forms of the same condition often have different ICD-10-CM codes, so accurate documentation of disease duration is essential for correct coding.

Question 13: What does the term 'accounts receivable (AR)' represent in medical billing?

Amounts owed to vendors by the practice
Money the practice has already collected
Money owed to the practice for services rendered but not yet paid (Correct answer)
The total charges generated in a billing period

Correct answer: Money owed to the practice for services rendered but not yet paid

Accounts receivable (AR) represents the total amount owed to a healthcare provider for services already rendered but not yet paid by payers or patients.

Question 14: Which standard transaction code set is used for submitting pharmacy claims electronically?

270/271
837P
NCPDP Telecom Standard (Correct answer)
835 ERA

Correct answer: NCPDP Telecom Standard

The NCPDP Telecom Standard (National Council for Prescription Drug Programs) is used for electronic pharmacy claims.

Question 15: What is TRICARE and who is eligible for it?

The health care program for active-duty service members, retirees, and their families through the Department of Defense (Correct answer)
A state-administered insurance program for government employees
A federal health program for low-income families
A supplemental insurance plan for Medicare beneficiaries

Correct answer: The health care program for active-duty service members, retirees, and their families through the Department of Defense

TRICARE is the healthcare benefit for members of the uniformed services (active duty, National Guard/Reserve, retired) and their eligible family members, administered by the Department of Defense.

Question 16: Which registration form obtains the patient's permission for treatment and acknowledges their financial responsibility?

HIPAA Privacy Notice
ABN
Assignment of benefits
Patient consent and financial responsibility form (Correct answer)

Correct answer: Patient consent and financial responsibility form

The patient consent and financial responsibility form obtains consent for treatment and informs the patient they are responsible for any unpaid balances.

Question 17: What does the prefix 'brady-' mean in medical terminology?

Small
Fast
Large
Slow (Correct answer)

Correct answer: Slow

The prefix 'brady-' means slow, as in bradycardia (slow heart rate).

Question 18: What is the primary purpose of the AHIMA and AAPC codes of ethics for medical coders?

To set billing rates for coding services
To guide professional conduct, ensure accurate coding, and protect patient privacy (Correct answer)
To determine which coding credentials are most valuable
To establish continuing education requirements

Correct answer: To guide professional conduct, ensure accurate coding, and protect patient privacy

Professional codes of ethics for coders emphasize accurate and complete coding, protecting patient confidentiality, avoiding fraud, and maintaining professional competence.

Question 19: What is the significance of the 'group number' on an insurance card?

It identifies the patient's primary care physician within the plan network
It is the patient's individual member identification number
It indicates the insurance company's local branch office
It identifies the specific plan design and benefits package associated with an employer's group contract with the insurance company (Correct answer)

Correct answer: It identifies the specific plan design and benefits package associated with an employer's group contract with the insurance company

The group number on an insurance card identifies the employer's group contract with the insurance plan, linking the patient to their specific employer-sponsored benefit package and coverage terms.

Question 20: In ICD-10-CM, what does the 7th character extension 'A' typically indicate?

Sequela
Subsequent encounter
Active treatment phase
Initial encounter (Correct answer)

Correct answer: Initial encounter

In ICD-10-CM, the 7th character 'A' designates an initial encounter — the active phase of treatment when the patient is receiving definitive care for the condition.

Question 21: What is a denial trend analysis and why is it important?

A review of patient complaints about billing practices
An analysis of how often providers change their fee schedules
An analysis of how long claims take to be paid
Identifying patterns in claim denials by reason code, payer, or service type to find and fix root causes of denials (Correct answer)

Correct answer: Identifying patterns in claim denials by reason code, payer, or service type to find and fix root causes of denials

Denial trend analysis involves tracking denials by type, payer, provider, and service to identify systemic issues. Finding root causes allows the practice to prevent denials proactively rather than just reacting to them.

Question 22: Which of the following best describes a breach of patient confidentiality?

Sharing a patient’s health information with a family member without consent (Correct answer)
Discussing a patient's case with authorized personnel in a secure setting
Using patient data for research with de-identified information
Reviewing a patient’s medical records for legitimate billing purposes

Correct answer: Sharing a patient’s health information with a family member without consent

Patient confidentiality, mandated by HIPAA, means that protected health information (PHI) cannot be disclosed without the patient's explicit authorization. Sharing a patient's health information with a family member without their consent constitutes a breach because it violates the patient's right to privacy. Authorized personnel and legitimate billing or de-identified research purposes are permissible under specific guidelines.

Question 23: What is Workers' Compensation insurance, and how does billing differ from standard health insurance?

A federal insurance program for all injury-related medical care
Insurance that employees purchase themselves to cover job-related injuries
Insurance that covers medical treatment and lost wages for employees injured on the job or who develop work-related illnesses; billing uses separate forms and diagnosis coding specific to the injury (Correct answer)
Insurance for employers to cover their liability if an employee injures a patient

Correct answer: Insurance that covers medical treatment and lost wages for employees injured on the job or who develop work-related illnesses; billing uses separate forms and diagnosis coding specific to the injury

Workers' compensation covers medical care and lost wages for work-related injuries/illnesses. Claims are billed to the employer's WC carrier using state-specific forms, focus only on the work injury, and follow different reimbursement rules than standard health insurance.

Question 24: What should a billing specialist do if they discover a significant billing error that could affect reimbursement?

Notify the insurance company immediately about the error and request an adjustment (Correct answer)
Correct the error and resubmit the claim without notifying the insurance company
Ignore the error if it benefits the practice financially
Wait for the insurance company to identify the error before taking any action

Correct answer: Notify the insurance company immediately about the error and request an adjustment

Ethical billing practices require transparency and honesty. If a significant billing error is discovered, the billing specialist must immediately notify the insurance company to correct the claim. This ensures compliance with regulations, prevents potential fraud accusations, and maintains the integrity of the billing process.

Question 25: A physician performs a diagnostic colonoscopy that becomes therapeutic when a polyp is removed. How should this be coded?

Code the diagnostic with modifier -52 and the therapeutic separately
Code only the therapeutic colonoscopy (Correct answer)
Code both diagnostic and therapeutic colonoscopy with modifier -59
Code only the diagnostic colonoscopy

Correct answer: Code only the therapeutic colonoscopy

When a diagnostic procedure becomes therapeutic, only the therapeutic (more extensive) code is reported.

Question 26: What is a self-funded (self-insured) employer health plan?

An employer that provides health benefits funded entirely by employee payroll deductions
An employer that assumes financial responsibility for employee health claims rather than paying premiums to an insurance company; typically administered by a TPA (Correct answer)
An employer that purchases a standard insurance policy from an insurer
A small employer that qualifies for a government subsidy to fund health benefits

Correct answer: An employer that assumes financial responsibility for employee health claims rather than paying premiums to an insurance company; typically administered by a TPA

In a self-funded plan, the employer directly pays employee health claims from its own funds rather than buying insurance. A Third-Party Administrator (TPA) typically processes claims using the employer's money.

Question 27: Which chapter in ICD-10-CM contains codes for external causes of morbidity?

Chapter 20 (Correct answer)
Chapter 19
Chapter 21
Chapter 18

Correct answer: Chapter 20

Chapter 20 (V00–Y99) contains codes for external causes of morbidity.

Question 28: A practice's billing manager is analyzing denial trends to identify areas for improvement. Which of the following denial reasons points to a preventable error that should be addressed by front-desk staff during patient registration and check-in?

Claim denied for exceeding the timely filing limit.
Service not covered under the patient's benefit plan.
Patient's insurance coverage was terminated prior to the date of service. (Correct answer)
Procedure determined to be not medically necessary.

Correct answer: Patient's insurance coverage was terminated prior to the date of service.

A denial due to terminated insurance coverage is a classic example of a preventable denial that can be caught by robust front-end processes. Verifying eligibility and benefits in real-time before or at the time of service would have identified that the patient's coverage was not active, allowing the office to make other financial arrangements.

Question 29: What is the difference between Medicare Advantage (Part C) and Original Medicare?

Medicare Advantage is only available in rural areas; Original Medicare covers urban areas
Medicare Advantage is a private plan alternative to Original Medicare that includes Part A and Part B benefits, often with additional coverage; Original Medicare is administered directly by the federal government (Correct answer)
Medicare Advantage requires a referral for all services; Original Medicare allows open access to any provider
Medicare Advantage covers only prescription drugs; Original Medicare covers hospitalization

Correct answer: Medicare Advantage is a private plan alternative to Original Medicare that includes Part A and Part B benefits, often with additional coverage; Original Medicare is administered directly by the federal government

Medicare Advantage (Part C) plans are offered by private insurers approved by Medicare. They include all Part A and Part B benefits and often add dental, vision, hearing, and prescription drug coverage. Original Medicare is the traditional fee-for-service program run by CMS.

Question 30: What is Medicaid?

A supplemental coverage plan for Medicare beneficiaries
A federal health insurance program for individuals age 65 and older
A joint federal-state program providing health coverage to low-income individuals and families (Correct answer)
A private insurance option for small businesses

Correct answer: A joint federal-state program providing health coverage to low-income individuals and families

Medicaid is a joint federal-state program that provides health coverage to eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities.

Question 31: What is a National Coverage Determination (NCD)?

A state-level insurance mandate requiring coverage of specific conditions
A coverage decision made by a commercial insurer for its subscriber population
A CMS policy determining whether a service, item, or procedure is covered nationally under Medicare, binding on all MACs and Medicare Advantage plans (Correct answer)
A determination made by a provider as to whether a service is medically necessary

Correct answer: A CMS policy determining whether a service, item, or procedure is covered nationally under Medicare, binding on all MACs and Medicare Advantage plans

An NCD is a national Medicare coverage policy issued by CMS that determines whether a specific medical service is covered, covered with conditions, or non-covered for all Medicare beneficiaries nationwide.

Question 32: A patient is seen in the clinic and the provider's final diagnosis is 'acute bronchitis caused by Mycoplasma pneumoniae.' Which is the correct ICD-10-CM code assignment?

J20.9
J40, B96.0
J20.0 (Correct answer)
J20.9, B96.0

Correct answer: J20.0

The ICD-10-CM Alphabetic Index under 'Bronchitis, acute or subacute, due to, Mycoplasma pneumoniae,' directs the coder to J20.0. This is a combination code that captures both the condition (acute bronchitis) and the causative organism, making it unnecessary and incorrect to code them separately.

Question 33: Which CPT modifier indicates a procedure was performed bilaterally?

-50 (Correct answer)
-51
-52
-53

Correct answer: -50

Modifier -50 is used to indicate that a procedure was performed bilaterally during the same operative session.

Question 34: Which form is also known as the CMS-1450?

UB-04 (Correct answer)
UB-92
CMS-1500
HCFA-1500

Correct answer: UB-04

The UB-04 claim form, also known as the CMS-1450, is the standardized form used by institutional providers, such as hospitals, to bill for inpatient and outpatient services. It is distinct from the CMS-1500, which is used by professional providers. The UB-04 captures comprehensive information about facility charges and patient demographics.

Question 35: What is a principal diagnosis in inpatient hospital coding?

The condition that was present on admission (POA)
The first diagnosis code entered on the UB-04
The most severe diagnosis listed on the claim
The condition established after study to be chiefly responsible for the admission of the patient to the hospital (Correct answer)

Correct answer: The condition established after study to be chiefly responsible for the admission of the patient to the hospital

The principal diagnosis is defined as the condition established after study to be chiefly responsible for occasioning the admission of the patient to the hospital for care.

Question 36: What information is contained in Box 33 of the CMS-1500 claim form?

The date and place of service
The referring physician's name and NPI
The billing provider's name, address, phone number, and NPI (Correct answer)
The patient's diagnosis codes

Correct answer: The billing provider's name, address, phone number, and NPI

Box 33 contains the billing provider's (or group practice's) name, address, phone number, and NPI — the entity responsible for submitting the claim and receiving payment.

Question 37: What is the purpose of an Advance Beneficiary Notice (ABN) in Medicare billing?

To document that a Medicare beneficiary has chosen a specific Medicare Advantage plan
To notify Medicare before a beneficiary is admitted to a hospital
To authorize a Medicare beneficiary to appeal a denial on their own behalf
To inform a Medicare beneficiary that a service may not be covered by Medicare so they can decide whether to receive the service and accept financial responsibility (Correct answer)

Correct answer: To inform a Medicare beneficiary that a service may not be covered by Medicare so they can decide whether to receive the service and accept financial responsibility

An ABN is a written notice given to a Medicare beneficiary before a service is provided when the provider believes Medicare may not cover the service, allowing the patient to make an informed financial decision.

Question 38: What is the key coding difference between inpatient and outpatient settings for uncertain diagnoses?

Both settings prohibit coding uncertain diagnoses
Outpatient allows coding uncertain diagnoses; inpatient does not
Inpatient allows coding uncertain diagnoses as if confirmed; outpatient requires coding only signs and symptoms (Correct answer)
Both settings allow coding uncertain diagnoses with a modifier

Correct answer: Inpatient allows coding uncertain diagnoses as if confirmed; outpatient requires coding only signs and symptoms

In inpatient coding, 'probable,' 'suspected,' and 'likely' diagnoses may be coded as confirmed. In outpatient coding, only confirmed diagnoses or signs/symptoms are coded.

Question 39: HCPCS Level II 'V codes' are used primarily for which types of services and supplies?

Vision, hearing, and speech-language pathology services and supplies (Correct answer)
Vascular surgical procedures
Vaccines and immunization administration
Ventilation and respiratory equipment

Correct answer: Vision, hearing, and speech-language pathology services and supplies

V codes (V0000–V2999) cover vision items such as eyeglasses and contact lenses, hearing items, and speech-language pathology services.

Question 40: What are patients' rights under the HIPAA Privacy Rule?

Rights including access to their PHI, request for amendments, accounting of disclosures, right to restrict certain uses/disclosures, and right to receive confidential communications (Correct answer)
The right to have all their medical bills forgiven if information is disclosed without permission
The exclusive right to decide who can access their complete medical record, with no exceptions
The right to have all of their PHI destroyed upon request

Correct answer: Rights including access to their PHI, request for amendments, accounting of disclosures, right to restrict certain uses/disclosures, and right to receive confidential communications

The HIPAA Privacy Rule gives patients specific rights: access their health records, request corrections (amendments), obtain an accounting of certain disclosures, request restrictions on use/disclosure, and receive confidential communications.

Question 41: Why is it important to verify insurance eligibility for established patients, not just new patients?

It is only necessary for new patients; established patients' insurance never changes
Insurance coverage can change due to job changes, open enrollment, aging off a parent's plan, or COBRA expiration — verifying at each visit prevents claim denials (Correct answer)
It is required by law to verify established patients' eligibility at every visit
Established patients are more likely to be fraudulent claimants

Correct answer: Insurance coverage can change due to job changes, open enrollment, aging off a parent's plan, or COBRA expiration — verifying at each visit prevents claim denials

Insurance coverage is not static — it changes frequently due to employment changes, life events, plan changes during open enrollment, and coverage terminations. Verifying at each encounter prevents billing errors and denials.

Question 42: Under HIPAA, which of the following is a covered entity?

A marketing firm that analyzes patient data for a hospital
A software company that builds EHR systems
An employer who sponsors a health plan
A health plan that pays for medical services (Correct answer)

Correct answer: A health plan that pays for medical services

Health plans are covered entities under HIPAA, along with healthcare providers and healthcare clearinghouses.

Question 43: What is the consequence of billing for a service that required prior authorization but was not obtained?

The payer pays at a reduced rate automatically
The claim is automatically resubmitted with a corrected authorization
The claim will likely be denied, and the provider may not be able to bill the patient (Correct answer)
The patient is responsible for the full cost of the service

Correct answer: The claim will likely be denied, and the provider may not be able to bill the patient

Claims without required prior authorization are typically denied, and in many contracts, the provider cannot balance-bill the patient for the denied amount.

Question 44: What is the difference between a 'subscriber' and a 'dependent' in health insurance?

A subscriber is the patient; a dependent is the patient's physician
A subscriber is the individual who enrolls in and is primarily covered by the insurance policy; a dependent is a family member (spouse, child) covered under the subscriber's plan (Correct answer)
There is no practical billing difference between subscriber and dependent
A subscriber pays higher premiums; dependents pay lower premiums

Correct answer: A subscriber is the individual who enrolls in and is primarily covered by the insurance policy; a dependent is a family member (spouse, child) covered under the subscriber's plan

The subscriber (or policyholder) is the person who enrolled in the health plan, often through an employer. Dependents are family members who receive coverage under the subscriber's policy.

Question 45: What is the HIPAA Security Rule's requirement for electronic PHI (ePHI)?

ePHI must be stored only on servers within the United States
Covered entities must implement administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of ePHI (Correct answer)
ePHI must be encrypted using AES-256 encryption at all times
ePHI access must be limited to licensed healthcare providers only

Correct answer: Covered entities must implement administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of ePHI

The Security Rule requires covered entities and business associates to implement three types of safeguards — administrative, physical, and technical — to protect ePHI from unauthorized access, use, or disclosure.

Question 46: What does 'meaningful use' of an EHR require?

Using certified EHR technology in ways that improve quality, safety, and efficiency (Correct answer)
Adopting an EHR approved by the state government
Using an EHR system at least once per week
Using EHRs only for billing and coding purposes

Correct answer: Using certified EHR technology in ways that improve quality, safety, and efficiency

Meaningful use requires healthcare providers to use certified EHR technology in specific, measurable ways to improve patient care.

Question 47: What does 'coordination of benefits (COB) information' need to be confirmed during eligibility verification for a patient with two insurance plans?

Only whether both plans cover the planned services
Which plan is primary (pays first), which is secondary, and whether the plans coordinate to prevent duplicate payment (Correct answer)
Whether the patient has met both plans' deductibles
Whether the patient prefers to use their primary or secondary insurance

Correct answer: Which plan is primary (pays first), which is secondary, and whether the plans coordinate to prevent duplicate payment

COB verification confirms the payment order — which plan is primary and which is secondary — and ensures proper billing sequence to comply with both plans' requirements and maximize claim payment.

Question 48: What is the 'two-midnight rule' under Medicare?

Any stay lasting more than two midnights is automatically paid as inpatient
A physician must expect a patient's stay to cross two midnights for inpatient admission to be medically necessary under Medicare (Correct answer)
Hospital discharge decisions must be made before midnight on the second day
Patients must be in observation for at least two midnights before inpatient admission

Correct answer: A physician must expect a patient's stay to cross two midnights for inpatient admission to be medically necessary under Medicare

CMS's two-midnight rule states that inpatient admission is appropriate when the treating physician expects the patient to require hospital care spanning at least two midnights.

Question 49: What is a Business Associate Agreement (BAA) under HIPAA?

A consent form signed by patients authorizing their information to be shared with third parties
A written contract between a covered entity and a business associate that specifies permitted uses of PHI and requires the business associate to protect PHI (Correct answer)
A contract between an insurance company and a healthcare provider specifying reimbursement rates
An agreement between two competing healthcare providers not to share patient information

Correct answer: A written contract between a covered entity and a business associate that specifies permitted uses of PHI and requires the business associate to protect PHI

A BAA is a legally required contract between a covered entity and any business associate who may access, use, or disclose PHI in the course of performing services. It specifies permitted uses and requires appropriate safeguards.

Question 50: What is the timely filing limit for Medicare claims?

2 years from date of service
90 days from date of service
6 months from date of service
1 year (12 months) from date of service (Correct answer)

Correct answer: 1 year (12 months) from date of service

Medicare requires claims to be filed within 12 months (1 calendar year) from the date of service. Claims submitted after this deadline will be denied for timely filing.

Question 51: What is a charge master (CDM) and how does it relate to billing?

A database of all payer contracts and their reimbursement rates
A comprehensive list of all services, procedures, supplies, and their associated charges used by a facility to generate patient bills and insurance claims (Correct answer)
A master list of all credentialed providers in a health system and their billing rates
A master schedule for all billing staff work assignments

Correct answer: A comprehensive list of all services, procedures, supplies, and their associated charges used by a facility to generate patient bills and insurance claims

The charge master (CDM) is a healthcare facility's comprehensive price list containing every billable item (services, procedures, supplies, drugs) with associated CDM codes, revenue codes, CPT/HCPCS codes, and charge amounts.

Question 52: What is the primary purpose of HCPCS Level II codes in medical billing?

To document patient demographic and insurance information
To report supplies, equipment, and services not adequately described by CPT codes (Correct answer)
To replace ICD-10-CM diagnosis codes for outpatient claims
To identify the ordering physician on a claim

Correct answer: To report supplies, equipment, and services not adequately described by CPT codes

HCPCS Level II codes fill the gap left by CPT codes by reporting supplies, equipment, drugs, and other services—particularly for Medicare and Medicaid claims.

Question 53: What is a Clinical Documentation Improvement (CDI) specialist's primary role in inpatient coding?

To assign final ICD-10-CM and ICD-10-PCS codes to inpatient records
To train coders on updated coding guidelines
To audit completed records for compliance errors
To query physicians to clarify documentation and capture the full complexity of the patient's condition (Correct answer)

Correct answer: To query physicians to clarify documentation and capture the full complexity of the patient's condition

CDI specialists review inpatient records concurrently and query physicians to ensure documentation is complete, accurate, and supports the appropriate level of coding.

Question 54: What does 'Medigap' (Medicare Supplement Insurance) cover?

Dental, vision, and hearing services excluded from Original Medicare
Out-of-pocket costs associated with Original Medicare, such as deductibles, copays, and coinsurance, sold by private insurance companies (Correct answer)
Prescription drugs not covered by Medicare Part B
Services that Medicare considers experimental or investigational

Correct answer: Out-of-pocket costs associated with Original Medicare, such as deductibles, copays, and coinsurance, sold by private insurance companies

Medigap plans are standardized supplemental insurance policies sold by private insurers that help pay the patient's share of Original Medicare costs (deductibles, coinsurance, copays).

Question 55: A physician orders a hemoglobin A1c test for a diabetic patient's routine monitoring. What code set is used to report this lab service?

Revenue codes
HCPCS Level II
ICD-10-PCS
CPT (85018 or 83036) (Correct answer)

Correct answer: CPT (85018 or 83036)

Lab services such as hemoglobin A1c are reported using CPT codes from the Pathology and Laboratory section.

Question 56: What is the CMS-1500 claim form primarily used for?

To submit claims for hospital inpatient services
To document patient medical history
To enroll patients in insurance plans
To submit claims for outpatient and professional services (Correct answer)

Correct answer: To submit claims for outpatient and professional services

The CMS-1500 claim form is the universal claim form used by non-institutional providers, such as physicians, therapists, and suppliers, to bill for outpatient and professional services. It is essential for submitting claims to Medicare, Medicaid, and most private insurance companies. This standardized form ensures consistent reporting of services and charges.

Question 57: What is the correct action when a patient's name on the insurance card differs slightly from the registration system?

Use the registration system name regardless
Cancel the appointment
Ignore the discrepancy and submit the claim
Verify the correct legal name with the patient and update the record to match insurance records (Correct answer)

Correct answer: Verify the correct legal name with the patient and update the record to match insurance records

Name mismatches between registration and insurance records cause claim rejections, so the billing team must verify and correct the name to match insurer records.

Question 58: What is upcoding in medical billing?

Assigning a higher-level code than documented to receive greater reimbursement (Correct answer)
Combining multiple codes into a single bundled code
Using outdated codes from a previous year's code set
Coding a service that was never performed

Correct answer: Assigning a higher-level code than documented to receive greater reimbursement

Upcoding is a fraudulent practice where a provider bills for a higher-level service than what was actually documented or performed, resulting in inflated reimbursement.

Question 59: What is an Independent Practice Association (IPA) model HMO?

A group of physicians who collectively own their own insurance plan
An HMO that employs all its physicians directly in a staff model
A Medicare Advantage plan administered by a group of academic medical centers
An HMO model where independent physicians in private practice contract with the IPA to provide services to HMO enrollees on a capitated or discounted fee basis (Correct answer)

Correct answer: An HMO model where independent physicians in private practice contract with the IPA to provide services to HMO enrollees on a capitated or discounted fee basis

In the IPA model, independent physicians in private practice (not employed by the HMO) contract through an IPA to provide care to HMO members. Physicians maintain their private practices and see both HMO and non-HMO patients.

Question 60: How should a billing specialist handle a situation where they realize a billing error could lead to overpayment by a patient?

Wait for the patient to notice and bring it up
Cover up the mistake to avoid embarrassment
Ignore the error if it benefits the practice financially
Correct the error, inform the patient, and provide a refund if necessary (Correct answer)

Correct answer: Correct the error, inform the patient, and provide a refund if necessary

Ethical billing practices dictate that any overpayment by a patient due to a billing error must be rectified promptly. The billing specialist has a responsibility to correct the mistake, transparently communicate it to the patient, and issue a refund for the overpaid amount. This upholds trust, ensures financial accuracy, and complies with consumer protection principles.

Question 61: What is the Stark Law's 'in-office ancillary services exception'?

An exception that exempts small practices from the Stark Law's referral restrictions
An exception that permits physicians to refer patients to their own practice or group practice for designated health services (DHS) that are provided in the same building and supervised by the referring physician (Correct answer)
An exception that allows self-referral to hospital services owned by the physician
An exception that allows physicians to self-refer patients to any service within their own office building

Correct answer: An exception that permits physicians to refer patients to their own practice or group practice for designated health services (DHS) that are provided in the same building and supervised by the referring physician

The in-office ancillary services exception allows physician practices to provide and bill for certain DHS (like lab, imaging, PT) within their practice, provided specific location, supervision, and billing requirements are met.

Question 62: Which of the following is the BEST practice for collecting patient co-payments?

Collect at the time of service before or after the appointment (Correct answer)
Waive the copay for all established patients
Only collect if the insurance requests it
Bill the patient after the visit only

Correct answer: Collect at the time of service before or after the appointment

Best practice and most payer contracts require collection of co-payments at the time of service to reduce accounts receivable and write-offs.

Question 63: A child is covered under health insurance plans from both parents. The mother's birthday is May 20th and the father's birthday is August 5th. According to the "birthday rule," which parent's plan is considered primary for the child's claims?

The plan of the parent whose name comes first alphabetically.
The mother's plan, because her birthday occurs earlier in the calendar year. (Correct answer)
The father's plan, because his birthday is later in the year.
The plan of the parent who has had coverage for a longer period.

Correct answer: The mother's plan, because her birthday occurs earlier in the calendar year.

The "birthday rule" is a standard method for determining primary vs. secondary coverage for a dependent child. The plan of the parent whose birthday (month and day only) occurs first in the calendar year is primary. Since May comes before August, the mother's plan is primary.

Question 64: What constitutes Protected Health Information (PHI) under HIPAA?

Only information relating to diagnoses and treatment plans
Health information that a patient has specifically requested be kept private
Only information stored in electronic medical records
Individually identifiable health information in any form (electronic, paper, oral) held or transmitted by a covered entity or business associate (Correct answer)

Correct answer: Individually identifiable health information in any form (electronic, paper, oral) held or transmitted by a covered entity or business associate

PHI is any individually identifiable health information in any format (electronic, paper, verbal) that relates to a person's past, present, or future physical or mental health condition, provision of healthcare, or payment for healthcare.

Question 65: Which ICD-10-CM code set is used for neoplasm coding?

Codes from the V-code section
Codes from Chapter 19 only
Codes from Chapter 2 (C00–D49) (Correct answer)
Codes from Chapter 18 only

Correct answer: Codes from Chapter 2 (C00–D49)

Neoplasm codes are found in Chapter 2 of ICD-10-CM, ranging from C00 to D49.

Question 66: What is meant by 'combination code' in ICD-10-CM?

A code that can be assigned to either inpatient or outpatient encounters
A code that replaces two CPT codes in a bundled service
A single code that fully describes two or more conditions, a condition and its complication, or a condition and its causative organism (Correct answer)
Using multiple codes to fully describe a condition

Correct answer: A single code that fully describes two or more conditions, a condition and its complication, or a condition and its causative organism

A combination code in ICD-10-CM classifies two diagnoses, or a diagnosis with an associated complication or causative organism, into a single code, simplifying documentation and coding.

Question 67: What is the significance of CARC (Claim Adjustment Reason Codes) on a remittance advice?

They indicate the amount the patient owes after insurance payment
They are standardized codes that explain why a claim was adjusted or denied, used to categorize and manage denials effectively (Correct answer)
They are codes assigned by the provider to explain why a service was medically necessary
They identify which ICD-10-CM codes triggered a medical necessity review

Correct answer: They are standardized codes that explain why a claim was adjusted or denied, used to categorize and manage denials effectively

CARCs are standardized codes maintained by the X12 organization that appear on ERAs/RAs to explain why a payment was adjusted or denied. They allow for systematic tracking and management of denials.

Question 68: What is the purpose of a HIPAA Notice of Privacy Practices (NPP)?

To inform patients of how their PHI may be used and disclosed, their privacy rights, and the covered entity's legal duties regarding PHI (Correct answer)
To provide patients with a list of all providers who have accessed their records
To notify patients that their information has been shared with another healthcare provider
To notify patients of upcoming changes to their insurance premiums

Correct answer: To inform patients of how their PHI may be used and disclosed, their privacy rights, and the covered entity's legal duties regarding PHI

The NPP is a document that covered entities must provide to patients describing their privacy rights, how PHI may be used and disclosed, the covered entity's privacy obligations, and how patients can exercise their rights.

Question 69: What is the Federal Employees Health Benefits (FEHB) Program?

A government-subsidized program for unemployed federal workers
A health plan exclusively for members of Congress
The health benefits program for federal civilian employees, retirees, and their dependents, offering a choice of health plans (Correct answer)
Medicare coverage for federal government retirees

Correct answer: The health benefits program for federal civilian employees, retirees, and their dependents, offering a choice of health plans

FEHB is the health benefits program for federal civilian employees and retirees, offering enrollment in a choice of approved health plans (fee-for-service, HMO, HDHP/HSA) administered by OPM.

Question 70: What is the purpose of a corporate integrity agreement (CIA)?

An internal policy document outlining a healthcare organization's ethical standards
A contract between two healthcare companies agreeing to share patient data securely
A HIPAA-required agreement for all hospitals with electronic health records
An agreement between the OIG and a provider who has settled a fraud investigation, requiring the provider to implement compliance measures under OIG monitoring for a defined period (Correct answer)

Correct answer: An agreement between the OIG and a provider who has settled a fraud investigation, requiring the provider to implement compliance measures under OIG monitoring for a defined period

A CIA is a settlement component in OIG fraud cases where the provider agrees to implement specific compliance measures (training, auditing, reporting) and submit to OIG oversight for 5 years as an alternative to exclusion.

Question 71: What are the four HIPAA Administrative Simplification standards?

Covered Entities, Business Associates, PHI Protection, and Audit Controls
Privacy, Security, Enforcement, and Breach Notification
Privacy, Security, Electronic Claims, and Patient Rights
Transactions and Code Sets, Privacy, Security, and National Identifier standards (Correct answer)

Correct answer: Transactions and Code Sets, Privacy, Security, and National Identifier standards

HIPAA's Administrative Simplification provisions include: (1) Transactions and Code Sets, (2) Privacy Rule, (3) Security Rule, and (4) National Identifier standards (NPI, employer identifier).

Question 72: What is a co-payment in health insurance?

The percentage the patient owes after the deductible
The maximum out-of-pocket annual cost
A fixed dollar amount paid by the patient at the time of service (Correct answer)
The annual amount a patient must pay before insurance activates

Correct answer: A fixed dollar amount paid by the patient at the time of service

A co-payment (copay) is a fixed amount (e.g., $25) the patient pays at the time of each service visit, separate from the deductible.

Question 73: What is a corrected claim and when is it used?

A claim submitted on paper to replace an electronic claim
A claim submitted by the patient after the provider declines to refile
A new claim submitted after a denial, used instead of an appeal
A resubmission of a previously processed claim with corrections to errors, submitted with frequency code 7 (replacement) or 8 (void) (Correct answer)

Correct answer: A resubmission of a previously processed claim with corrections to errors, submitted with frequency code 7 (replacement) or 8 (void)

A corrected claim replaces a previously processed (paid, denied, or partially paid) claim to fix billing errors. It is identified with bill type frequency code 7 (replacement) or 8 (void/cancel) on institutional claims, or with condition code on professional claims.

Question 74: What is the Medicare redetermination process?

A process for reviewing Medicare premium calculations
The first level of Medicare's five-level administrative appeals process, where the Medicare Administrative Contractor reviews the claim denial (Correct answer)
A secondary billing process for Medicare crossover claims
A Medicare audit process for identifying fraud

Correct answer: The first level of Medicare's five-level administrative appeals process, where the Medicare Administrative Contractor reviews the claim denial

Medicare redetermination is the first level of appeal, filed with the Medicare Administrative Contractor (MAC) within 120 days of the initial determination. The MAC reviews the claim and makes a new determination.

Question 75: What is a write-off in medical billing, and when is it appropriate?

A write-off is required whenever a patient has a deductible
A write-off should only be performed by the physician, not billing staff
A write-off is the adjustment of a balance that cannot or should not be collected — appropriate for contractual adjustments, small balance write-offs per policy, and hardship cases (Correct answer)
A write-off is always a loss for the practice; it should be avoided in all circumstances

Correct answer: A write-off is the adjustment of a balance that cannot or should not be collected — appropriate for contractual adjustments, small balance write-offs per policy, and hardship cases

Write-offs are appropriate for contractual adjustments (required by payer contracts), small balances (per practice policy), uncollectible accounts, and charity care — but should never be used to avoid collecting legitimate patient balances improperly.

Question 76: What is the difference between HMO and PPO insurance plans?

HMOs are government plans; PPOs are private employer plans
HMOs have no premiums; PPOs have no deductibles
HMOs cover only preventive care; PPOs cover only specialist services
HMOs require a primary care physician and referrals and limit care to network providers; PPOs allow more flexibility with higher out-of-pocket costs for out-of-network care (Correct answer)

Correct answer: HMOs require a primary care physician and referrals and limit care to network providers; PPOs allow more flexibility with higher out-of-pocket costs for out-of-network care

HMOs (Health Maintenance Organizations) coordinate care through a PCP and require referrals to specialists, with coverage limited to the network. PPOs (Preferred Provider Organizations) offer more flexibility, allowing patients to see any provider but with higher costs for out-of-network care.

Question 77: What is an external appeal in the context of insurance claim denials?

An appeal sent to a different department within the insurance company
An appeal reviewed by an independent organization outside the insurance company, available after exhausting internal appeals (Correct answer)
An appeal submitted by the patient rather than the provider
An appeal filed directly with CMS for Medicare denials

Correct answer: An appeal reviewed by an independent organization outside the insurance company, available after exhausting internal appeals

An external appeal (independent external review) is conducted by an Independent Review Organization (IRO) outside the insurance company after the internal appeals process has been exhausted, providing an unbiased review.

Question 78: What is the purpose of a Local Coverage Determination (LCD)?

A local government mandate requiring coverage of specific health services
A coverage decision made by a local commercial insurance company
A coverage decision made by a hospital for its specific patient population
A Medicare policy issued by a MAC that specifies covered indications, limitations, and medical necessity criteria for specific services in the MAC's jurisdiction (Correct answer)

Correct answer: A Medicare policy issued by a MAC that specifies covered indications, limitations, and medical necessity criteria for specific services in the MAC's jurisdiction

LCDs are coverage policies issued by MACs that define when and under what circumstances Medicare will cover specific services within the MAC's geographic jurisdiction, supplementing national NCDs.

Question 79: A Certified Billing and Coding Specialist is reviewing an Electronic Remittance Advice (ERA) to post payments. Which of the following pieces of information is essential for reconciling the account and determining the next steps?

Patient's preferred pharmacy
Claim Adjustment Reason Codes (CARCs) (Correct answer)
Provider's National Provider Identifier (NPI)
The date the claim was created

Correct answer: Claim Adjustment Reason Codes (CARCs)

Claim Adjustment Reason Codes (CARCs) are used on the remittance advice to explain why a claim was paid differently than it was billed. These standardized codes detail adjustments, denials, or reductions, and are critical for the billing specialist to understand the adjudication outcome and decide whether to bill the patient, appeal the decision, or make a correction.

Question 80: In ICD-10-CM, what does the 7th character 'A' typically indicate?

Initial encounter (Correct answer)
Sequela
Subsequent encounter
Not applicable

Correct answer: Initial encounter

'A' as the 7th character designates the initial encounter for active treatment.

Question 81: What is claim scrubbing?

Physically cleaning paper claims before mailing them
Automated review of claims for errors (coding, eligibility, missing data) before submission to reduce denials (Correct answer)
Removing sensitive information from claims for HIPAA compliance
Reviewing claims that have been previously denied and cleaned up for resubmission

Correct answer: Automated review of claims for errors (coding, eligibility, missing data) before submission to reduce denials

Claim scrubbing is an automated pre-submission process that checks claims for coding errors, missing information, eligibility issues, and payer-specific rules to catch errors before the claim reaches the payer.

Question 82: In EHR documentation, which practice ensures accuracy and prevents falsification?

Backdating entries when a note was missed
Amending notes without indicating what was changed
Late entries documented as such with date/time of actual entry (Correct answer)
Deleting errors and rewriting the note correctly

Correct answer: Late entries documented as such with date/time of actual entry

Late entries should be clearly labeled as late entries with the actual date and time they were written, not the date of the encounter.

Question 83: What is patient financial counseling in the revenue cycle?

Collecting all outstanding balances from patients at the time of service
Advising patients on how to invest their healthcare savings
The process of informing patients of their financial responsibility, payment options, and available assistance programs before and after services are rendered (Correct answer)
Negotiating with insurance companies on behalf of patients

Correct answer: The process of informing patients of their financial responsibility, payment options, and available assistance programs before and after services are rendered

Patient financial counseling helps patients understand their insurance benefits, out-of-pocket costs, and available payment assistance options, improving collections and patient satisfaction while reducing bad debt.

Question 84: HCPCS Level II codes are structured as how many characters?

5 characters (1 letter + 4 numbers) (Correct answer)
6 characters (2 letters + 4 numbers)
5 characters (2 letters + 3 numbers)
4 characters (1 letter + 3 numbers)

Correct answer: 5 characters (1 letter + 4 numbers)

HCPCS Level II codes consist of 5 characters: one alpha letter followed by four numeric digits (e.g., A0425).

Question 85: A patient is admitted to the hospital for management of severe dehydration. The dehydration is a direct result of infectious norovirus gastroenteritis. Both conditions are treated. According to the ICD-10-CM Official Guidelines for Coding and Reporting, what is the correct sequencing for the principal diagnosis?

A single combination code for gastroenteritis with dehydration should be used.
Either condition can be sequenced first since both were treated.
The principal diagnosis is the infectious norovirus gastroenteritis. (Correct answer)
The principal diagnosis is the dehydration.

Correct answer: The principal diagnosis is the infectious norovirus gastroenteritis.

According to the ICD-10-CM Official Guidelines, if a patient is admitted for a condition that is a manifestation or result of an underlying disease, the underlying disease should be sequenced as the principal diagnosis. In this case, the gastroenteritis (A08.1) is the underlying cause of the dehydration (E86.0), so it is sequenced first.

Question 86: What is a guarantor in the context of patient accounts?

The patient's primary care physician
The insurance company
The referring provider
The person financially responsible for the patient's account (Correct answer)

Correct answer: The person financially responsible for the patient's account

The guarantor is the individual (often the patient or a parent/guardian) who is legally responsible for paying the medical bill.

Question 87: Which revenue code on the UB-04 indicates medical/surgical room and board — private?

Revenue code 012x
Revenue code 020x
Revenue code 010x
Revenue code 011x (Correct answer)

Correct answer: Revenue code 011x

Revenue code 011x (0110-0119) identifies accommodation charges for private room medical/surgical care.

Question 88: What is a 'placeholder' character in ICD-10-CM, and what letter is used?

The letter X, used to fill a required character position (Correct answer)
The number 0, used when laterality is unspecified
The letter Z, used for encounter type
The letter O, used to fill the 6th character position

Correct answer: The letter X, used to fill a required character position

The letter X is used as a placeholder to fill a required character position when no specific code exists for that position.

Question 89: What does the term 'data integrity' mean in the context of EHRs?

The accuracy, completeness, and consistency of health data over its lifecycle (Correct answer)
The security level of a patient's login credentials
The number of authorized users who can access a record
The speed at which data is entered into the EHR

Correct answer: The accuracy, completeness, and consistency of health data over its lifecycle

Data integrity means that health information is accurate, complete, consistent, and has not been altered improperly.

Question 90: What is the purpose of the Medicare/Medicaid exclusion screening requirement?

To exclude Medicare/Medicaid patients from receiving experimental treatments
To exclude certain high-cost services from Medicare coverage to control costs
To screen new Medicare beneficiaries for fraud history before granting enrollment
To ensure that no federal healthcare program payments are made for services provided by an excluded individual or entity, protecting program integrity (Correct answer)

Correct answer: To ensure that no federal healthcare program payments are made for services provided by an excluded individual or entity, protecting program integrity

Exclusion screening ensures that providers, employees, contractors, and vendors who are barred from federal programs are not involved in Medicare/Medicaid service delivery or billing, preventing improper payments.

Question 91: Which CPT code is used for an initial hospital care visit with high medical decision making?

99231
99221
99222
99223 (Correct answer)

Correct answer: 99223

99223 is the highest-level initial hospital inpatient or observation care code, requiring high MDM or 75 or more minutes.

Question 92: What is the correct coding sequence for a patient admitted for sepsis caused by MRSA pneumonia?

Code only the MRSA (B95.62) as it is the causal organism
Code only the sepsis; do not separately code the underlying infection
Code the pneumonia first, then sepsis, then MRSA
Code the sepsis first (A41.02 Sepsis due to MRSA), then the pneumonia as the underlying infection (Correct answer)

Correct answer: Code the sepsis first (A41.02 Sepsis due to MRSA), then the pneumonia as the underlying infection

When sepsis and a localized infection (like pneumonia) are present, ICD-10-CM guidelines direct coders to sequence the sepsis code first, followed by a code for the localized infection.

Question 93: Which code set is used to report physician and outpatient services on a CMS-1500 claim form?

UB-04
CPT (Correct answer)
HCPCS Level III
ICD-10-CM

Correct answer: CPT

CPT (Current Procedural Terminology) codes are used to report physician services, outpatient procedures, and other medical services on the CMS-1500 claim form.

Question 94: What does the term 'downcoding' mean?

Simplifying complex codes for patient billing statements
Using codes from a previous edition of the code book
Assigning a lower-level code than documentation supports (Correct answer)
Converting ICD-9-CM codes to ICD-10-CM

Correct answer: Assigning a lower-level code than documentation supports

Downcoding occurs when a payer or coder assigns a lower-level code than what the documentation supports, resulting in reduced reimbursement.

Question 95: Which section of ICD-10-CM is used to code a patient's chief complaint when no definitive diagnosis has been established?

Chapter 21: Factors influencing health status (Z codes)
Chapter 18: Symptoms, signs, and abnormal clinical findings (R codes) (Correct answer)
Chapter 1: Certain infectious and parasitic diseases
Chapter 19: Injury, poisoning, and external causes

Correct answer: Chapter 18: Symptoms, signs, and abnormal clinical findings (R codes)

Chapter 18 (R codes) covers symptoms, signs, and abnormal clinical and laboratory findings. These codes are used when a definitive diagnosis cannot be established during the encounter.

Question 96: What is the VA Community Care Program and how does it affect billing?

A VA-administered Medicaid supplemental plan for low-income veterans
A volunteer program where community physicians donate care to veterans
A program allowing eligible veterans to receive care from non-VA providers in their community when VA services are inaccessible or unavailable, billed to the VA or its contractors (Correct answer)
A program where the VA provides care to non-veteran community members in rural areas

Correct answer: A program allowing eligible veterans to receive care from non-VA providers in their community when VA services are inaccessible or unavailable, billed to the VA or its contractors

VA Community Care allows eligible veterans to seek care from non-VA community providers when VA care is unavailable, inaccessible, or not in the best interest of the veteran. Providers bill the VA or its contracted administrators (Optum/TriWest).

Question 97: What does 'coinsurance' mean in health insurance billing?

A fixed per-visit fee
Dual coverage from two insurers
The maximum benefit limit
The percentage of costs a patient pays after the deductible is met (Correct answer)

Correct answer: The percentage of costs a patient pays after the deductible is met

Coinsurance is the percentage of covered costs the patient is responsible for after meeting their deductible (e.g., 20% after a 80/20 plan).

Question 98: What is the Medicare Physician Fee Schedule (MPFS)?

A list of physicians who accept Medicare assignment
A schedule of approved diagnostic codes for Medicare billing
The maximum charge a physician can bill Medicare patients
A payment system used by Medicare to determine reimbursement for physician and outpatient services based on Resource-Based Relative Value Units (RBRVUs) (Correct answer)

Correct answer: A payment system used by Medicare to determine reimbursement for physician and outpatient services based on Resource-Based Relative Value Units (RBRVUs)

The Medicare Physician Fee Schedule determines payment for physician services using a formula based on Relative Value Units (RVUs) for work, practice expense, and malpractice, multiplied by a conversion factor.

Question 99: What is the maximum number of characters in a valid ICD-10-CM code?

8
6
5
7 (Correct answer)

Correct answer: 7

ICD-10-CM codes can be up to 7 characters in length.

Question 100: A patient's insurance requires a referral from their PCP before seeing a specialist. This is characteristic of which plan type?

HMO (Correct answer)
PPO
Indemnity plan
EPO

Correct answer: HMO

Health Maintenance Organizations (HMOs) typically require a referral from the primary care physician before a member can see a specialist.

Question 101: What should be verified during insurance eligibility verification before an appointment?

Active coverage, effective dates, deductible/coinsurance/copay amounts, referral requirements, network status of provider, and coverage for the specific services planned (Correct answer)
Only whether the patient has active insurance coverage
Insurance coverage and the patient's social security number
Only the patient's copay amount for the visit type

Correct answer: Active coverage, effective dates, deductible/coinsurance/copay amounts, referral requirements, network status of provider, and coverage for the specific services planned

Complete eligibility verification encompasses active coverage status, benefit details (deductible, copay, coinsurance), out-of-pocket maximum, referral/authorization requirements, and whether the planned services are covered.

Question 102: What does 'coordination of benefits' mean in the context of claim adjudication?

The process by which multiple insurance plans determine the order and amount each plan pays for a covered service to prevent duplicate payment (Correct answer)
The process of coordinating multiple billing staff members to work on a single complex claim
The alignment of billing codes between different payer fee schedules
The process of coordinating medical records from multiple providers for a single claim

Correct answer: The process by which multiple insurance plans determine the order and amount each plan pays for a covered service to prevent duplicate payment

COB in adjudication is the process by which primary and secondary insurers coordinate to ensure that combined payments do not exceed the provider's charge or the patient's total liability, preventing overpayment.

Question 103: What information is required on a CMS-1500 claim form in Box 21?

Diagnosis codes (ICD-10-CM codes) (Correct answer)
Procedure codes and charges
Patient's date of birth and sex
Provider NPI number

Correct answer: Diagnosis codes (ICD-10-CM codes)

Box 21 on the CMS-1500 claim form is used to report ICD-10-CM diagnosis codes.

Question 104: What is the purpose of a voice authorization in insurance verification?

To authorize the patient to speak on behalf of the insurance company
To obtain written permission from the patient to verify their insurance
To obtain a physician's verbal order for a service before billing
To verify coverage and obtain an authorization number from the payer over the phone when electronic verification is unavailable or inconclusive (Correct answer)

Correct answer: To verify coverage and obtain an authorization number from the payer over the phone when electronic verification is unavailable or inconclusive

Voice authorization involves calling the payer's provider services line to verify benefits and obtain a reference or authorization number when electronic verification doesn't provide sufficient detail or when real-time approval is needed.

Question 105: What is a Medicare Administrative Contractor (MAC)?

A contractor that audits Medicare Advantage organizations
A Medicare-approved company that provides managed care plans
A private company that designs Medicare benefit plans
A private company contracted by CMS to process Medicare fee-for-service claims in a specific geographic jurisdiction (Correct answer)

Correct answer: A private company contracted by CMS to process Medicare fee-for-service claims in a specific geographic jurisdiction

MACs are private companies that serve as Medicare's claim processors in specific geographic regions (jurisdictions), handling Part A and Part B claims submission, payment, and audit functions.

Question 106: What is the purpose of an 'authorization number'?

The physician's NPI used to request authorization
A code used to identify the type of service being requested
A unique identifier assigned by the payer confirming that a service has been authorized for coverage (Correct answer)
The patient's member ID on their insurance card

Correct answer: A unique identifier assigned by the payer confirming that a service has been authorized for coverage

An authorization number is a unique tracking number issued by the payer confirming approval of a requested service.

Question 107: HCPCS Level II 'T codes' are primarily used by which payer type?

State Medicaid programs (Correct answer)
Commercial private insurers
Workers' compensation carriers
Medicare only

Correct answer: State Medicaid programs

T codes are temporary codes established for use by state Medicaid programs to report services that are not described by other national HCPCS codes.

Question 108: A patient calls requesting a copy of their medical records. Under HIPAA, the covered entity must provide access within:

30 calendar days (with a possible 30-day extension) (Correct answer)
7 calendar days
60 calendar days
10 business days

Correct answer: 30 calendar days (with a possible 30-day extension)

Under HIPAA's Privacy Rule, covered entities must act on a request for access to PHI within 30 calendar days, with one possible 30-day extension if the entity provides written notice.

Question 109: What is considered a 'kickback' in healthcare?

A penalty assessed for late claim submission
Anything of value given to induce or reward referrals of federal healthcare program business (Correct answer)
A discount offered to cash-paying patients
A refund issued to a patient for an overpayment

Correct answer: Anything of value given to induce or reward referrals of federal healthcare program business

Under the Anti-Kickback Statute, it is illegal to knowingly offer, pay, solicit, or receive anything of value to induce or reward referrals of items or services covered by federal healthcare programs.

Question 110: A patient has primary coverage through UnitedHealthcare and secondary coverage through Aetna. After UnitedHealthcare pays, a balance remains. What should the biller do?

Resubmit the claim to UnitedHealthcare with a higher charge
Bill the patient for the remaining balance immediately
Submit a COB claim to Aetna as the secondary payer with the primary EOB attached (Correct answer)
Write off the remaining balance as a contractual adjustment

Correct answer: Submit a COB claim to Aetna as the secondary payer with the primary EOB attached

After the primary payer pays, the biller submits a coordination of benefits claim to the secondary payer with the primary EOB to process the remaining balance.

Question 111: What is a deductible in a health insurance plan?

The fixed amount paid per visit regardless of total cost
The monthly premium the insured pays for coverage
The maximum amount insurance will pay in a year
The amount the insured must pay out-of-pocket before the insurance begins paying (Correct answer)

Correct answer: The amount the insured must pay out-of-pocket before the insurance begins paying

A deductible is the amount a patient must pay for covered services before the insurance company begins sharing costs. Most preventive care services are exempt from deductibles under the ACA.

Question 112: What is the first step a medical biller should take upon receiving a claim denial?

Identify the denial reason code and determine whether the denial is correctable, appealable, or valid (Correct answer)
Contact the patient to collect the balance
Immediately write off the denied amount
Resubmit the claim without changes

Correct answer: Identify the denial reason code and determine whether the denial is correctable, appealable, or valid

Upon receiving a denial, the first step is to review the reason/remark codes on the remittance advice to understand why the claim was denied and determine the appropriate course of action.

Question 113: What is a deductible in health insurance?

The percentage the insurer pays after the copay
A fixed dollar amount paid per visit
The monthly premium paid for coverage
The annual amount a patient pays out-of-pocket before insurance begins covering costs (Correct answer)

Correct answer: The annual amount a patient pays out-of-pocket before insurance begins covering costs

A deductible is the amount a patient must pay annually before the insurance company begins paying for covered services.

Question 114: What is the False Claims Act (FCA) primarily designed to prevent?

Improper coding of diagnoses for research purposes
Fraudulent billing to federal healthcare programs like Medicare and Medicaid (Correct answer)
Identity theft in healthcare settings
Unauthorized use of protected health information

Correct answer: Fraudulent billing to federal healthcare programs like Medicare and Medicaid

The False Claims Act prohibits submitting false or fraudulent claims for payment to federal programs. It includes qui tam provisions allowing whistleblowers to file suit on behalf of the government.

Question 115: A hospital's billing department receives a document from an insurance payer that details the payment for multiple claims. It includes information on allowed amounts, denied services with reason codes, and the total amount paid. What is this document called?

Remittance Advice (RA) (Correct answer)
CMS-1500 Form
Pre-authorization Request
Explanation of Benefits (EOB)

Correct answer: Remittance Advice (RA)

A Remittance Advice (RA), often sent electronically as an Electronic Remittance Advice (ERA), is a document provided by a payer to a provider. It explains the payment and any adjustments made to multiple claims. An Explanation of Benefits (EOB) is a similar document but is sent to the patient.

Question 116: Which code set is used to report durable medical equipment (DME) and supplies on a Medicare claim?

HCPCS Level II codes (Correct answer)
Revenue codes
ICD-10-PCS codes
CPT codes

Correct answer: HCPCS Level II codes

HCPCS Level II codes (alphanumeric codes beginning with letters A-V) are used to report DME, supplies, orthotics, prosthetics, and other items not in CPT.

Question 117: What is 'step therapy' and why is it relevant to prior authorization?

The process of stepping up insurance coverage levels
A billing method for phased treatment plans
A treatment protocol requiring patients to try less costly or less intensive treatments before a more expensive one is approved (Correct answer)
A physical therapy progression protocol

Correct answer: A treatment protocol requiring patients to try less costly or less intensive treatments before a more expensive one is approved

Step therapy (fail-first) requires patients to try and fail on first-line or less expensive treatments before a payer will authorize a more expensive option.

Question 118: A patient presents without an insurance card. What is the BEST first step for the billing staff?

Skip insurance verification
Ask the patient for their insurance name, ID, and group number to verify eligibility by phone or portal (Correct answer)
Bill the patient as self-pay automatically
Refuse service until the card is provided

Correct answer: Ask the patient for their insurance name, ID, and group number to verify eligibility by phone or portal

Staff should collect the patient's insurance information verbally or via a portal to verify eligibility in real time, ensuring the claim can be submitted correctly.

Question 119: What information should be included in a formal appeal letter for a denied claim?

Patient information, claim details, denial reason, clinical documentation supporting medical necessity, applicable policies/guidelines, and a specific request for reconsideration (Correct answer)
The patient's complaint about the denial
Only the physician's letter explaining why the service was necessary
Only the claim number and date of service

Correct answer: Patient information, claim details, denial reason, clinical documentation supporting medical necessity, applicable policies/guidelines, and a specific request for reconsideration

A complete appeal letter includes patient and claim identification, the specific denial reason being appealed, supporting clinical documentation, references to clinical guidelines, and a clear request for the specific action sought.

Question 120: What CPT modifier is appended when a service is reduced or eliminated at the physician's discretion?

-53
-22
-52 (Correct answer)
-58

Correct answer: -52

Modifier -52 (Reduced Services) is used when a service is partially reduced or eliminated at the physician's discretion.

CBCS — Certified Billing and Coding Specialist

The NHA CBCS exam certifies medical billing and coding specialists in claims processing, regulatory compliance, CPT/ICD-10-CM coding, reimbursement, and revenue cycle management.

120

Questions

180 min

Time Limit

78%

To Pass

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