CEHRS Revenue Cycle and Billing 2 — Questions and Answers
Question 1: A claim is returned to the provider because the patient's insurance ID number was entered incorrectly. This is classified as a:
- Denial
- Rejection (Correct answer)
- Write-off
- Adjustment
Correct answer: Rejection
A rejection occurs before adjudication when a claim has technical errors such as incorrect ID numbers and must be corrected and resubmitted.
Question 2: Which Medicare fee schedule is used to reimburse outpatient physical therapy services?
- Inpatient Prospective Payment System
- Resource-Based Relative Value Scale (Correct answer)
- Ambulatory Payment Classification
- Diagnosis-Related Group
Correct answer: Resource-Based Relative Value Scale
The Resource-Based Relative Value Scale (RBRVS) is used by Medicare to set payment rates for physician and outpatient therapy services.
Question 3: When a provider bills a higher-complexity service than was actually performed, this is known as:
- Unbundling
- Upcoding (Correct answer)
- Downcoding
- Balance billing
Correct answer: Upcoding
Upcoding is the fraudulent practice of billing for a more expensive service than was rendered, inflating reimbursement.
Question 4: The process of verifying a patient's insurance eligibility BEFORE the date of service is called:
- Pre-authorization
- Pre-certification
- Pre-verification (Correct answer)
- Pre-adjudication
Correct answer: Pre-verification
Pre-verification (eligibility verification) confirms coverage, co-pays, and deductibles before the patient arrives for care.
Question 5: A Remittance Advice (RA) from a payer showing CO-45 indicates:
- The charge exceeds the fee schedule amount (Correct answer)
- The service requires prior authorization
- The claim was submitted past the timely filing limit
- The patient has a secondary payer
Correct answer: The charge exceeds the fee schedule amount
CO-45 is a CARC (Claim Adjustment Reason Code) indicating the charge exceeds the contracted fee schedule or maximum allowable amount.
Question 6: Which of the following is the correct order of payer coordination when a patient has both Medicare and Medicaid?
- Medicaid pays first, then Medicare
- Medicare pays first, then Medicaid (Correct answer)
- They split the payment equally
- The patient chooses which pays first
Correct answer: Medicare pays first, then Medicaid
Medicare is always primary to Medicaid; Medicaid is the payer of last resort and may cover remaining patient liability.
Question 7: An Advance Beneficiary Notice (ABN) must be given to a Medicare patient when:
- The patient has a secondary insurance
- The provider believes Medicare may deny the service as not medically necessary (Correct answer)
- The patient owes a co-payment
- The claim exceeds the annual deductible
Correct answer: The provider believes Medicare may deny the service as not medically necessary
An ABN informs Medicare beneficiaries that Medicare may not pay for a service and allows them to decide whether to proceed and accept financial responsibility.
CEHRS Revenue Cycle and Billing 2
A claim is returned to the provider because the patient's insurance ID number was entered incorrectly.
This is classified as a: