CRCR - Certified Revenue Cycle Representative Program Revenue Cycle Management Fundamentals Questions and Answers Flashcards

What is the difference between a write-off and a contractual adjustment in healthcare billing?

Answer: A contractual adjustment is a pre-negotiated discount per payer contract; a write-off is a balance deemed uncollectable

Contractual adjustments represent the difference between billed charges and the payer's allowed amount per contract, while write-offs reflect amounts determined to be uncollectable after collection efforts.

Under HIPAA, what is the standard electronic transaction for submitting a professional claim to a payer?

Answer: 837P

The 837P (Professional) transaction is the HIPAA-mandated standard electronic format for submitting professional claims from physicians and other non-institutional providers.

Which of the following best describes the purpose of prior authorization in the revenue cycle?

Answer: To obtain payer approval before certain services are rendered to ensure coverage and payment

Prior authorization is a payer requirement where providers must obtain approval before delivering specific services, ensuring the payer deems the service medically necessary and covered.

What does the term 'upcoding' refer to in healthcare billing compliance?

Answer: Reporting a higher-level or more complex service than was actually provided to obtain greater reimbursement

Upcoding is a fraudulent billing practice where providers intentionally report a code for a more expensive service than was performed, which violates the False Claims Act.

In managed care contracting, what is a 'carve-out'?

Answer: A specific service or benefit excluded from a managed care contract and reimbursed under separate terms

A carve-out separates certain services (e.g., mental health, pharmacy, or lab) from the main managed care arrangement, often reimbursing them under a different fee schedule or through a separate specialty vendor.

What is the significance of the 'timely filing' limit in health insurance billing?

Answer: It is the payer-specified deadline by which a claim must be submitted or it will be denied as untimely

Each payer establishes a timely filing deadline (e.g., 90 days, 1 year from date of service) beyond which claims will be denied, making it critical to track and submit claims promptly.

Which payment methodology does Medicare use to reimburse acute inpatient hospital stays?

Answer: Diagnosis-Related Groups (DRGs) under the Inpatient Prospective Payment System (IPPS)

Medicare's IPPS pays hospitals a predetermined rate based on the patient's DRG, which groups similar diagnoses and procedures, incentivizing efficiency by paying a flat amount regardless of actual costs.