Free NCCT Health Insurance Claim Processing Questions and Answers — Questions and Answers
Question 1: Which form is used by a physician's office to submit claims for outpatient services?
- UB-04
- CMS-1500 (Correct answer)
- Advance Beneficiary Notice (ABN)
- Explanation of Benefits (EOB)
Correct answer: CMS-1500
The CMS-1500 form is the standard claim form used by physicians and other non-institutional providers to bill Medicare Part B and most other insurance carriers for outpatient services. The UB-04 form is used for institutional claims, such as those from hospitals or skilled nursing facilities.
Question 2: What does the term 'adjudication' refer to in the health insurance claim process?
- The process of submitting a claim electronically
- The initial patient registration and data entry
- The insurance carrier's process of reviewing a claim and determining payment (Correct answer)
- The process of appealing a denied claim
Correct answer: The insurance carrier's process of reviewing a claim and determining payment
Adjudication is the step where the payer (insurance company) evaluates a submitted claim against the patient's policy benefits, provider contract, and medical necessity. This process determines whether the claim should be paid, denied, or reduced in amount.
Question 3: A patient's insurance requires pre-authorization for an MRI. What is the primary purpose of this process?
- To confirm the patient's demographic information is correct
- To determine the patient's copayment amount
- To obtain approval from the insurance company for a service to be covered (Correct answer)
- To bill the patient for the procedure before it is performed
Correct answer: To obtain approval from the insurance company for a service to be covered
Pre-authorization, or prior authorization, is a process used by insurance companies to verify that a specific service, prescription, or procedure is medically necessary and covered under the patient's plan. Obtaining this approval beforehand helps prevent claim denials for non-covered services.
Question 4: Which coding system is used to report medical procedures and services performed by physicians?
- ICD-10-CM
- HCPCS Level II
- CPT (Current Procedural Terminology) (Correct answer)
- NDC (National Drug Code)
Correct answer: CPT (Current Procedural Terminology)
The CPT (Current Procedural Terminology) coding system, maintained by the American Medical Association (AMA), is used to describe and report medical, surgical, and diagnostic services. ICD-10-CM is used for diagnoses, and HCPCS Level II is for supplies and non-physician services.
Question 5: A patient receives a document from their insurance company that details how a claim was processed, including the amount paid and the patient's financial responsibility. What is this document called?
- Superbill
- Remittance Advice (RA)
- Explanation of Benefits (EOB) (Correct answer)
- CMS-1500
Correct answer: Explanation of Benefits (EOB)
An Explanation of Benefits (EOB) is a statement sent from the health insurance company directly to the patient to explain what medical treatments and/or services were paid for on their behalf. A Remittance Advice (RA) is a similar document sent from the payer to the provider.
Question 6: In health insurance terminology, what is a 'deductible'?
- A fixed fee paid by the patient at the time of service
- A percentage of the cost of a covered service that the patient is responsible for
- The maximum amount a patient will have to pay out-of-pocket in a year
- A specified amount of money that the insured must pay before an insurance company will pay a claim (Correct answer)
Correct answer: A specified amount of money that the insured must pay before an insurance company will pay a claim
The deductible is a fixed amount a patient must pay for covered health care services each year before their insurance plan starts to pay. After the deductible is met, the patient typically only pays a copayment or coinsurance for covered services, and the insurance company pays the rest.
Question 7: When must a provider have a patient sign an Advance Beneficiary Notice of Noncoverage (ABN)?
- Before any service is provided to a new Medicare patient
- When a provider believes a service may not be considered medically necessary by Medicare (Correct answer)
- After a claim has been denied by Medicare
- For all services billed to a secondary insurance carrier
Correct answer: When a provider believes a service may not be considered medically necessary by Medicare
An ABN is a waiver of liability that a provider must issue to a Medicare beneficiary before providing services that they believe Medicare will not cover based on medical necessity rules. By signing it, the patient acknowledges they will be financially responsible if Medicare denies payment.
Free NCCT Health Insurance Claim Processing Questions and Answers
Which form is used by a physician's office to submit claims for outpatient services?