CBCS Payment Adjudication 2

Question 1

What is the adjudication process for a health insurance claim?

Accepted Answer

The process by which an insurance company evaluates a claim, determines coverage, applies benefits, calculates payment, and issues a determination

Answer

The process of submitting a claim electronically to the payer

Answer

The billing department's process of coding diagnoses and procedures

Answer

The process of sending a claim to collections when unpaid

Question 2

What does 'allowed amount' mean in insurance payment adjudication?

Accepted Answer

The maximum amount the insurance plan will recognize for a covered service, based on the contracted fee schedule or UCR rates

Answer

The maximum amount a provider can charge for any service

Answer

The amount the patient must pay before insurance kicks in

Answer

The total amount paid by all payers for a single service

Question 3

What is an Explanation of Payment (EOP) or Electronic Remittance Advice (ERA)?

Accepted Answer

An electronic document (835 transaction) sent from payer to provider detailing how claims were processed, amounts paid, adjustments applied, and denial reasons

Answer

A report sent to the patient detailing their remaining deductible balance

Answer

A document the provider sends to explain how they calculated their charges

Answer

A federal form required for Medicare claim submission

Question 4

What is 'balance billing' and when is it prohibited?

Accepted Answer

Billing the patient the difference between the provider's charge and the insurer's payment, which is prohibited for in-network providers (covered by contract) and in states with surprise billing protections

Answer

Billing the patient the balance of a claim after insurance pays its portion — always permitted

Answer

Billing for the patient's deductible and copay — always required

Answer

Billing a secondary insurer for the balance after the primary pays — always prohibited

Question 5

What is the purpose of the 835 reconciliation process in medical billing?

Accepted Answer

To match ERA/835 payment data against outstanding claims in the practice management system, ensuring accurate payment posting and identifying discrepancies

Answer

To reconcile the practice's paper records with electronic claims submissions

Answer

To reconcile employee payroll records with Medicare timesheets

Answer

To reconcile the CMS fee schedule with the practice's charge master

Question 6

What happens when a payer identifies an overpayment to a provider?

Accepted Answer

The payer sends a recoupment notice or offset notice, and the provider must return the overpaid amount or dispute it within the specified timeframe

Answer

Nothing — overpayments are considered provider income

Answer

The provider can apply the overpayment as a credit toward future claims

Answer

The patient is billed for the overpayment amount