Revenue Cycle Management & Medical Billing Flashcards

Which step in the revenue cycle occurs BEFORE a patient visit to ensure financial responsibility is established?

Answer: Eligibility verification

Eligibility verification confirms a patient's insurance coverage and benefits before the visit, reducing claim denials.

A medical practice has a Days in Accounts Receivable (DAR) of 52 days. According to best practices, this figure indicates:

Answer: Performance slightly above the 45-day benchmark

A DAR of 52 days exceeds the industry benchmark of 45 days, signaling the practice's collections are slower than optimal.

What is a 'clean claim' in medical billing?

Answer: A claim that contains all required information for prompt payer processing

A clean claim includes all required data elements and is free of errors, enabling the payer to process it without requesting additional information.

Under the Medicare Physician Fee Schedule, which component accounts for the largest portion of the relative value unit (RVU)?

Answer: Physician work RVU

Physician work RVU, which reflects the time, skill, and effort of the provider, typically constitutes the largest portion of the total RVU.

A claim is denied with remark code CO-4. This code indicates:

Answer: The procedure code is inconsistent with the modifier

CO-4 (Claim Adjustment Reason Code 4) means the service or procedure code is inconsistent with the modifier, requiring correction before resubmission.

Which federal law requires that physician practices implement specific safeguards to protect electronically transmitted health information during billing processes?

Answer: HIPAA Security Rule

The HIPAA Security Rule mandates administrative, physical, and technical safeguards for electronic protected health information (ePHI), including billing data.

In medical billing, what does the term 'contractual adjustment' represent?

Answer: The difference between the billed charge and the payer's allowed amount

A contractual adjustment is the negotiated discount between the provider's billed charge and the payer's contracted allowed amount that the provider agrees to write off.