Frequently Asked Questions

Also see Glossary of Terms.

Have a question? Please contact us.

(click on question to show response)
  • How to Understand the Coordination of Benefits Rule in Health Insurance:
  • The term Coordination of Benefits (COB) refers to group health insurance policies. Group insurance is designed to provide coverage for all major medical bills but not exceeding 100% of the total expenses. What happens when two or more insurance companies have to split the costs of these expenses? COB was established to regulate this and to make it easy for policyholders. COB rules do not apply to individual policyholders.

    1. Find out if you have more than one group insurance policy. For example, if you are employed, then your employer is likely to have your name included under the company's group policy. Similarly, if you have additional group coverage through membership in certain institutions, through your spouse's employer or through a group policy you purchased previously, then you need to learn more about COB rules.
    2. Differentiate between primary and secondary companies. In case of health expenses, which insurance provider will pay first? The COB guidelines provide a detailed understanding on this aspect. Usually, your employer's plan would be the primary one to provide coverage to you while any other plan that shows you as dependent would be secondary. The primary provider pays first and the remaining amount needs to be adjusted by the secondary company in some cases.
    3. Pay special attention to the kind of coverage in cases of dependent children when a couple is divorced or separated.
    4. Check the COB with Medicare. If you have a Medicare policy, then COB rules have been specified by the CMS (Centers for Medicare & Medicaid Services). Request a copy to understand them in more detail.
    5. Understand the claim settlement system between the primary and secondary insurance providers. Talk to your local agents to clarify your doubts.
    6. Pick up a guide on COB and health insurance from your nearest bookstore. It will provide more detailed information.
  • What is exactly co-insurance and how does it work?
  • Although you may be paying a hefty monthly premium for your health insurance (or a percent of what your employer pays), your health plan most likely does not cover 100% of the cost of your healthcare. Additional costs (or out-of-pocket expenses) that you may be responsible for include an annual deductible, copayments, and co-insurance.

    A copayment (or copay) is a fixed-dollar amount that you pay each time for certain services. Most commonly, you will be responsible for a copayment each time you have a doctor's visit and for each prescription medication you fill. For example, with my health insurance, I pay a $15 copayment for each primary care physician visit, $25 copayment for a specialist visit, and $20 for each brand-name prescription.

    Coinsurance is a percent of the cost of your care. You are responsible for paying the co-insurance amount. For example, if a doctor's visit is $100 and you have a 20% coinsurance, you will pay the doctor $20 and your health plan will pay the doctor $80. Copayments are most often used in HMOs and for services you receive from a network provider in a PPO. Coinsurance is often used when you get services from an out-of-network provider in a PPO. This can be quite costly, especially if you use an out-of-network hospital for a surgical procedure.

    Co-insurance is an insurance-related term that describes a splitting or spreading of risk among multiple parties.
  • What is Aetna Medical Capitation Payment?
  • Capitation checks usually arrive with a list of patients attached. Did this check arrive with any other paperwork? If it did, could you kindly email it to me so that we can see what patients this check paid for? We need to post the capitated checks against the patients that are enrolled in Capitated Plans.

    Definition of 'Capitation Payments'
    Capitation payments are defined, periodic, per-patient payments (usually monthly) for each individual enrolled in a capitated insurance plan. For example, a provider could be paid per-month, per-patient, despite how many times the patient comes in for treatment or how many services needed. The payment varies, depending on the capitation agreement, but generally they are based on characteristics such as the age of the individual enrolled in the plan. Modifying the plan according to specific characteristics for groups of patients is one way to compensate providers for the medical care expected for similar ailments within a group.

    Read more at:
  • The Importance of Verifying Eligibility.
  • How Predetermining Patient Coverage can save you money and hassle.
    Lets focus on the previsit as one of the most critical phases of patient interaction regarding payment collection. That's because claim problems get more expensive and less likely to be resolved the longer they linger. The earlier you can detect and address such problems the better. And of course, preventing them altogether is the best solution of all. One aspect of pre-visits is eligibility.
    You really can't overstate the importance of having a good system for verifying patient eligibility. Coverage-related denials are extremely costly, but they are also highly preventable. And verification is a critical part of determining a patient's financial responsibility — increasingly important as the boom in "consumer-directed" insurance plans continues to add to the frequency and variety of copays.
    After taking a closer look at the importance of eligibility and how some of the numbers break down, we offer some insights into strategies for assessing your own payer mix in terms of eligibility and for prioritizing your eligibility efforts.

    Denial Frequency
    Coverage-related (or eligibility) denials cost your practice more than any other type of denial because they typically occur more frequently than other denials, and they affect an entire claim as opposed to specific charges within a claim. Figure 1 shows a breakdown of the percentage of claims denied for coverage among the four major payer types.
    Patient Denial Rates
    As you can see, in our experience, Medicaid and Medicaid HMOs are the worst offenders, with eligibility-related denials occurring as much as five times as often as with commercial and BCBS plans, and almost 10 times as often as with Medicare. As the Medicare HMOs increased, we will notice the same trend with ALL insurances in the very near future - perhaps two months from now at most. Medicare has historically denied at a relatively low rate — basically because a patient is either over 65 or not, and therefore is qualified or not. But this has been changing in recent months. Lately, Medicare systems have begun requiring that a patient's name, date of birth, and member ID match their files exactly for the claim to be eligible for payment not to mention the influx of the HMOs that have saturated the market. Of course, many of these eligibility denials are for patients who are, in fact, eligible. But if a patient has a new member ID or is enrolled in an HMO, some element of his demographic information isn't matching up, or his payer will only cover him when billed as a secondary, he gets rejected by the system.

    Time to Payment
    Eligibility-related denials are not only relatively frequent, but when they happen they take longer to resolve than other types of denials. Figure 2 illustrates how long it takes by payer to get payment on a claim that has been denied for eligibility reasons. Keep in mind that a medical billing office has on staff experts who do nothing but work appeals with specific payers all day. The ratios should hold true. We find that, overall, coverage-related denials take two to three times longer to pay than non-denied claims and about 30 percent to 40 percent longer to pay than claims denied for other reasons.
    Days to Payment
    Don't be surprised to see that not only Medicaid claims go through the above cycle. ALL insurances go through the same process. Balances are often transferred to the patient and go through time-consuming collections processes. Therefore, a physician should not underestimate the importance of patient eligibility and demand of his/her staff that this be done DAILY prior to the patient walking through the physician's door.