CPC Reimbursement & Claims Processing 2 — Questions and Answers
Question 1: What is an Explanation of Benefits (EOB)?
- A document that lists the patient's diagnosis codes
- A statement from the insurer explaining how a claim was processed and paid (Correct answer)
- A form that authorizes a procedure
- A provider's bill sent to the patient
Correct answer: A statement from the insurer explaining how a claim was processed and paid
An EOB is a document from the insurance company showing how a claim was adjudicated, including amounts billed, allowed, paid, and patient responsibility.
Question 2: Which type of Medicare denial occurs when a service is not covered under the patient's Medicare benefit?
- Administrative denial
- Contractual denial
- Medical necessity denial
- Coverage/benefit denial (Correct answer)
Correct answer: Coverage/benefit denial
A coverage/benefit denial means the service is not a covered benefit under the patient's Medicare plan, not a medical necessity issue.
Question 3: The Resource-Based Relative Value Scale (RBRVS) used by Medicare is based on which three components?
- Diagnosis complexity, patient age, and geographic location
- Physician work, practice expense, and malpractice expense (Correct answer)
- Procedure time, facility cost, and drug cost
- Complexity, risk, and duration of service
Correct answer: Physician work, practice expense, and malpractice expense
The RBRVS consists of physician work RVUs, practice expense RVUs, and malpractice expense RVUs, each adjusted by a geographic practice cost index (GPCI).
Question 4: What is the purpose of a Medicare Advance Beneficiary Notice (ABN)?
- To obtain prior authorization for a procedure
- To inform the beneficiary that Medicare may not cover a service and that the patient may be liable (Correct answer)
- To appeal a denied Medicare claim
- To notify Medicare of a patient's discharge
Correct answer: To inform the beneficiary that Medicare may not cover a service and that the patient may be liable
An ABN is given to Medicare patients before providing a service that may be denied as not medically necessary, informing them they may be financially responsible.
Question 5: In the Medicare reimbursement system, what does 'participating provider' status mean?
- The provider accepts any insurance the patient has
- The provider accepts Medicare's approved amount as payment in full and cannot balance bill (Correct answer)
- The provider is enrolled in a Medicare Advantage plan only
- The provider bills Medicare electronically
Correct answer: The provider accepts Medicare's approved amount as payment in full and cannot balance bill
Participating providers (PAR) accept assignment and agree to accept the Medicare approved amount as payment in full, without balance billing.
Question 6: Which federal law prohibits physician self-referral to entities in which the physician has a financial relationship?
- False Claims Act
- Anti-Kickback Statute
- Stark Law (Physician Self-Referral Law) (Correct answer)
- HIPAA Privacy Rule
Correct answer: Stark Law (Physician Self-Referral Law)
The Stark Law (42 U.S.C. §1395nn) prohibits physicians from referring Medicare/Medicaid patients to entities with which they have a financial relationship.
CPC Reimbursement & Claims Processing 2
What is an Explanation of Benefits (EOB)?