HAC Healthcare Insurance & Claims Processing 2 — Questions and Answers
Question 1: A claim is denied with remark code CO-4. What does this denial reason indicate?
- Service is not covered under the patient's plan
- The procedure code is inconsistent with the modifier (Correct answer)
- Claim was submitted after the timely filing deadline
- Patient is not eligible on the date of service
Correct answer: The procedure code is inconsistent with the modifier
CO-4 denials indicate that the procedure code submitted is inconsistent with the modifier used on the claim.
Question 2: Which document serves as the primary source of truth for determining a patient's covered benefits in a commercial insurance plan?
- The Explanation of Benefits (EOB)
- The Summary of Benefits and Coverage (SBC)
- The Certificate of Coverage or Evidence of Coverage (Correct answer)
- The provider's fee schedule
Correct answer: The Certificate of Coverage or Evidence of Coverage
The Certificate of Coverage (or Evidence of Coverage) is the legally binding document that defines all covered benefits, exclusions, and limitations under a plan.
Question 3: Under the coordination of benefits (COB) rules, the 'birthday rule' is used to determine which parent's plan is primary for a dependent child. If both parents have the same birthday, which plan is primary?
- The plan of the parent who has been covered longer (Correct answer)
- The plan of the parent whose last name comes first alphabetically
- The plan of the parent with the higher benefit level
- The plan of the parent who enrolled in their plan first
Correct answer: The plan of the parent who has been covered longer
When parents share the same birthday, the plan that has been in effect longer is designated as primary under the birthday rule tiebreaker.
Question 4: A provider submits a claim for 99214 and 99213 for the same patient on the same date of service. The payer rejects the second E/M code. Which rule is being applied?
- Global period rule
- Mutually exclusive edit (Correct answer)
- Medically unlikely edit (MUE)
- Incidental procedure rule
Correct answer: Mutually exclusive edit
Payers apply mutually exclusive edits (often via NCCI) to deny two E/M services billed by the same provider for the same patient on the same date.
Question 5: What is the function of the 'crossover claim' in Medicare/Medicaid dual-eligible billing?
- It allows providers to bill Medicare and Medicaid simultaneously for the same service
- Medicare automatically forwards the claim to Medicaid after processing for secondary payment (Correct answer)
- The patient submits the claim to both payers independently
- Medicaid processes the claim first, then forwards the balance to Medicare
Correct answer: Medicare automatically forwards the claim to Medicaid after processing for secondary payment
For dual-eligible patients, Medicare processes the claim first and then automatically crossovers the EOB to Medicaid to pay the remaining patient liability.
Question 6: A healthcare organization receives an 835 transaction from a payer. What does this electronic transaction represent?
- Electronic remittance advice (ERA) containing payment and claim adjudication details (Correct answer)
- Electronic eligibility inquiry response
- A pre-authorization approval notification
- An electronic claim submission file
Correct answer: Electronic remittance advice (ERA) containing payment and claim adjudication details
The ANSI X12 835 transaction set is the electronic remittance advice (ERA) that conveys claim payment and adjustment information from payer to provider.
Question 7: Which type of insurance plan requires members to select a primary care physician (PCP) who must provide referrals to see specialists?
- Preferred Provider Organization (PPO)
- Health Maintenance Organization (HMO) (Correct answer)
- Exclusive Provider Organization (EPO)
- Point of Service (POS) plan
Correct answer: Health Maintenance Organization (HMO)
HMO plans require members to designate a PCP who acts as the gatekeeper, providing referrals necessary for specialist visits.
HAC Healthcare Insurance & Claims Processing 2
A claim is denied with remark code CO-4.
What does this denial reason indicate?