CHC Healthcare Billing and Coding Compliance Questions and Answers 3 — Questions and Answers
Question 1: The 'two-midnight rule' in Medicare billing primarily governs which type of admission?
- Outpatient surgery billing
- Inpatient hospital admissions and whether they meet criteria for Part A payment (Correct answer)
- Observation status billing
- Emergency department visit coding
Correct answer: Inpatient hospital admissions and whether they meet criteria for Part A payment
CMS's two-midnight rule states that inpatient admission is generally appropriate if the physician expects the patient to require hospital care spanning at least two midnights, qualifying for Part A reimbursement.
Question 2: When a provider receives an overpayment from Medicare, within how many days must it be reported and returned under the ACA's 60-day rule?
- 30 days
- 45 days
- 60 days (Correct answer)
- 90 days
Correct answer: 60 days
The Affordable Care Act requires that identified Medicare/Medicaid overpayments be reported and returned within 60 days of identification, after which retention of the overpayment becomes a False Claims Act violation.
Question 3: What is the primary purpose of an Advance Beneficiary Notice (ABN) in Medicare billing?
- To obtain patient consent for treatment
- To notify a Medicare patient in advance that a service may not be covered and shift financial liability to the patient (Correct answer)
- To pre-authorize elective procedures with Medicare
- To document medical necessity for inpatient admission
Correct answer: To notify a Medicare patient in advance that a service may not be covered and shift financial liability to the patient
An ABN informs a Medicare beneficiary that a specific service may be denied as not medically necessary, allowing the patient to decide whether to proceed and accept financial responsibility.
Question 4: Which coding system is primarily used for inpatient hospital diagnoses and procedures for Medicare billing under the MS-DRG system?
- CPT (Current Procedural Terminology)
- ICD-10-CM/PCS (International Classification of Diseases) (Correct answer)
- HCPCS Level II codes
- DSM-5 codes
Correct answer: ICD-10-CM/PCS (International Classification of Diseases)
ICD-10-CM is used for diagnosis coding and ICD-10-PCS for inpatient procedure coding, which together drive the MS-DRG assignment and corresponding Medicare payment.
Question 5: What does 'clawback' mean in the context of healthcare billing compliance?
- A provision allowing providers to increase fees retroactively
- The recovery by a payer of previously paid funds determined to be improper or overpaid (Correct answer)
- A discount arrangement between hospitals and insurers
- A billing error correction process
Correct answer: The recovery by a payer of previously paid funds determined to be improper or overpaid
A clawback occurs when a payer (such as Medicare) recovers funds from a provider due to identified overpayments, billing errors, or compliance violations.
Question 6: In healthcare compliance, what is the significance of the '3-day payment window rule' for hospital outpatient services?
- Claims must be submitted within 3 days of service
- Outpatient services provided within 3 days before an inpatient admission must be bundled into the inpatient claim (Correct answer)
- Providers have 3 days to correct billing errors
- Medicare pays claims within 3 days of receipt
Correct answer: Outpatient services provided within 3 days before an inpatient admission must be bundled into the inpatient claim
Under the 3-day payment window rule, diagnostic and certain other outpatient services provided within 3 days prior to an inpatient admission are bundled into the DRG payment and cannot be billed separately.
CHC Healthcare Billing and Coding Compliance Questions and Answers 3
The 'two-midnight rule' in Medicare billing primarily governs which type of admission?