CCM Reimbursement and Utilization Management 2 — Questions and Answers
Question 1: A patient's insurer denies a claim stating the service was 'not medically necessary.' What is the case manager's FIRST step?
- File an external appeal immediately
- Review the clinical criteria used for the denial and compare with the patient's documentation (Correct answer)
- Contact the state insurance commissioner
- Advise the patient to pay out of pocket
Correct answer: Review the clinical criteria used for the denial and compare with the patient's documentation
Reviewing the denial criteria against clinical documentation helps identify whether a peer-to-peer review or formal appeal is warranted.
Question 2: Which payment model reimburses a provider a fixed amount per member per month regardless of services rendered?
- Fee-for-service
- Per diem
- Capitation (Correct answer)
- Case rate
Correct answer: Capitation
Capitation pays a set monthly fee per enrolled member, transferring financial risk to the provider.
Question 3: Under Medicare, what is the purpose of the Advance Beneficiary Notice (ABN)?
- To authorize a procedure before it is performed
- To inform a beneficiary that Medicare may not cover a service so they can decide whether to proceed (Correct answer)
- To appeal a Medicare denial on behalf of the patient
- To certify medical necessity for inpatient admission
Correct answer: To inform a beneficiary that Medicare may not cover a service so they can decide whether to proceed
An ABN alerts Medicare beneficiaries in advance that a specific service may be denied, allowing an informed financial decision.
Question 4: A case manager is conducting concurrent review for an inpatient stay. What is the primary goal of this activity?
- Determine the patient's eligibility for disability benefits
- Ensure continued hospitalization is medically justified and facilitate timely discharge planning (Correct answer)
- Negotiate a lower per diem rate with the hospital
- Verify the patient's secondary insurance coverage
Correct answer: Ensure continued hospitalization is medically justified and facilitate timely discharge planning
Concurrent review monitors ongoing medical necessity for inpatient care and promotes efficient, appropriate length of stay.
Question 5: Which federal program provides health coverage to individuals with end-stage renal disease (ESRD) regardless of age?
- Medicaid
- CHIP
- Medicare (Correct answer)
- TRICARE
Correct answer: Medicare
Medicare covers individuals with ESRD under a special entitlement, making age irrelevant for this specific condition.
Question 6: What does the term 'usual, customary, and reasonable' (UCR) refer to in insurance billing?
- The maximum amount a Medicaid program will pay for a service
- The average amount charged by providers in a geographic area for the same service (Correct answer)
- The negotiated rate between a provider and a managed care organization
- The Medicare fee schedule amount for a specific procedure code
Correct answer: The average amount charged by providers in a geographic area for the same service
UCR represents the prevailing fee for a given service in a specific region and is used to determine out-of-network payment levels.
Question 7: A hospital is paid a flat rate for an entire episode of care regardless of the patient's actual length of stay or services used. This best describes which payment method?
- Fee-for-service
- Per diem reimbursement
- Diagnosis-Related Group (DRG) payment (Correct answer)
- Cost-plus reimbursement
Correct answer: Diagnosis-Related Group (DRG) payment
DRG-based payment bundles reimbursement for an entire inpatient stay into a single predetermined amount tied to diagnosis.
CCM Reimbursement and Utilization Management 2
A patient's insurer denies a claim stating the service was 'not medically necessary.' What is the case manager's FIRST step?