Healthcare providers sometimes offer “prompt-pay discount” to encourage patients to pay their bills within a certain period, including outstanding copayments or deductible amounts. Such programs should be structured appropriately to ensure compliance with applicable laws and payer contracts.

The legal rules differ by state.

California law, for example, allows healthcare providers to charge a prompt payment discount.

1. To encourage the prompt payment of health or medical care claims, health care providers are hereby expressly authorized to grant discounts in health or medical care claims when payment is made promptly within time limits prescribed by the health care providers or institutions rendering the service or treatment.
2. Not with standing any provision in any health care service plan contract or insurance contract to the contrary, health care providers are hereby expressly authorized to grant discounts for health or medical care provided to any patient the health care provider has reasonable cause to believe is not eligible for, or is not entitled to, insurance reimbursement, coverage under the Medi-Cal program, or coverage by a health care service plan for the health or medical care provided. Any discounted fee granted pursuant to this section shall not be deemed to be the health care provider’s usual, customary, or reasonable fee for any other purposes, including, but not limited to, any health care service plan contract or insurance contract.

Prompt-pay discounts are often referred to as “2/10, net 30” discounts. Translation: If the payment amount is due in the typical 30 days, you’d receive a 2 percent discount if you pay it in 10 days instead of 30.

If your company is offered such a discount, should you take it? There’s a helpful formula accounting professionals use to help determine the effective annual return of taking prompt-pay discounts:

(Amount of discount/discounted price) multiplied by (number of days in the year/number of days paid early)

Let’s say you have a $1,000 invoice. You’d receive a $20 discount if you paid it within 10 days, so the math would look like this:

(2/98) multiplied by (360*/20) equals 0.367, or 36.7 percent

According to this formula, taking the 2/10, net 30 discount is the equivalent of an effective annual return of more than 36 percent. So the answer is yes, you should absolutely take the discount — right?

Not so fast. Before deciding on your final answer, you need to perform a cost-benefit analysis that compares the savings that can be realized to the opportunity cost of not having the use of this cash yourself for up to 20 days.

The first thing you have to find out is whether your cash flow will allow you to pay early enough to take the discount. To determine this, take a close look at your cash cycle — the timing of the monthly flows of cash into and out of your business.

Unless you’re sitting on enough cash to cover at least one month’s worth of business expenses in advance, you’ll need to accelerate your cash disbursements by at least one month to take advantage of the discount. However, this can be challenging even for companies with strong cash flow. Another option is to tap funds from current investments to pay invoices early, although this may involve sacrificing interest, dividend, or capital gains opportunities.

A third option is borrowing the money you need to make payments early. While this would not affect current working capital or investment opportunities, there is obviously a cost involved in borrowing funds. So the question becomes: Are the savings that can be realized via a prompt-pay discount greater or less than your cost of funds?

The best way to determine this is to crunch the numbers and see the impact of paying a year’s worth of supplier invoices early via a 2/10, net 30 discount:

• Annual invoice total: $1 million
• Total annual discounts: $20,000 (1,000,000 multiplied by 0.02, or 2 percent)
• Average additional funds needed to fund an additional 20 days of cash flow each month: $54,795**

The net annual savings or loss would be the difference between the total annual discounts and the cost of borrowing the funds needed to take advantage of them. If your cost of funds (e.g., interest rate) is 7 percent, the net savings would be as follows:

• Cost of funds: $3,836 ($54,795 multiplied by 0.07, or 7 percent)
• Net savings: $16,164

As this example shows, in a low-interest-rate environment like today’s, it usually makes financial sense to borrow the money necessary to take advantage of prompt-pay discounts. The most efficient way to borrow money for this purpose is via a bank revolving line of credit, which can easily be tapped and repaid at the owner’s discretion.

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Denial Code CO 11 – The diagnosis is inconsistent with the procedure

Insurance will deny the claim as Denial Code CO 11. Whenever the Procedure code billed with an inappropriate diagnosis code.

Diagnosis code (DX Code):

Diagnosis code represents the description of the disease. These codes are assigned by medical coding department by reviewing the medical reports in the format of ICD 10 Code.

In many cases, denial code CO 11 occurs because of a simple mistake in coding, and the wrong diagnosis code was used. That’s the first thing to check if you get this type of denial. Double-check with the coding department and the patient’s record to ensure there wasn’t a typo or to ensure a diagnosis wasn’t left out accidentally. If there were an error here, you’d need to correct the claim, and then resubmit it as a corrected claim.

If there was no error but you believe that the denial is in error, then you have the option to appeal the claim and provide medical records that back up the medical necessity of the procedure for this patient’s diagnosis.

1. First check whether payment received for previous DOS with same procedure and diagnosis code billed, then call and inform same to the claims department and send claim back for reprocessing.
2. Suppose payment not received or we don’t have previous DOS with same procedure and diagnosis, then the next step is to review medical records or to check with the coding team that the used diagnosis is really in-consistent with the procedure code billed and also check whether it’s billed as per LCD guidelines. If not then update the appropriate diagnosis and resubmit as corrected claim.
3. If the diagnosis billed is appropriate as per medical records and billed as per LCD guidelines, but insurance denied the claim incorrectly. Then reach out claims department and send the claim back for reprocessing.
4. If they disagree to send the claim back for reprocessing, final step is to appeal the claim along with medical records.
You can reach the claims department team with the following question to resolve the below denial:

• May I know the Claim received and denial date?
• First check which DX code is inappropriate with the procedure code billed and then in application for previous DOS whether we received any payment for same DX and procedure code billed.

If yes: Inform same to insurance and send the claim back for reprocessing.

If No: May I know appeal Limit, appeal address or Fax# to appeal the claim if necessary.(Check with coding team and take appropriate action as explained above)

• Claim Number and Cal reference Number

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CO12 Denial Code: Diagnosis is inconsistent with the Provider Type

Insurance will deny the claim as Adjustment Code CO 12 – The diagnosis is inconsistent with the provider type, whenever the Procedure code billed with an inappropriate diagnosis code.

Diagnosis code (DX Code):

Diagnosis code represents the description of the disease. These codes are assigned by medical coding department by reviewing the medical reports in the format of ICD 10 Code.

What is a Provider?

Provider means a person, agent, business, corporation, or other entity who, in connection with submission of claims to the Department, receives or directs payment from the Department on behalf of a performing provider and has been delegated the authority to obligate or act on behalf of the performing provider. There are following types of Providers

• All Fee-For-Service Providers
• Ambulatory Surgical Centers (ASC)
• Ambulance Services
• Anesthesiologists
• Clinical Labs
• Critical Access Hospitals
• Durable Medical Equipment (DME)
• Federally Qualified Health Centers (FQHC)
• Home Health Agency (HHA)
• Hospice
• Hospital
• Opioid Treatment Programs
• Practice Administration
• Pharmacist
• Physician
• Rural Health Clinics
• Skilled Nursing Facility

Medical billing is one large system part of the overarching healthcare network. The healthcare network includes everything from medical billing to best practices for patient care, health institutions, and private practices.

Call Scenario:

1. May I get the denial date?
2. Could you please tell me which diagnosis code is invalid (If there are multiple DX code coded)
3. Check patient payment history if the same DX code paid with same CPT
4. IF Yes

• Ask for clarification from rep and send claim back for reprocessing
• What is the TAT for reprocessing?
• May I have the claim# & call ref#

5. IF No

• What is the time limit to send corrected claim?
• What is the Fax# or Mailing address to send an appeal?
• How much is the time limit to send an appeal?
• May I have the claim# & call ref#

Note:

• This denial should be assigned to coding team to review and provide correct dx code and once response received with correct dx details then send corrected claim to insurance by updating correct dx code even if the time limit to send correct claim is crossed.
• If coding team states that dx code is correct then send an appeal to insurance.
• When sending an appeal, calculate the time limit from denial date, if it is not crossed then send the appeal or else write off the claim if time limit is crossed.
• Sometimes client wants us to send the appeal even if time limit is crossed, so work accordingly.

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Most health insurance plans will pay for a second surgical opinion, but be sure to contact your plan beforehand to find out for sure. In some cases, if you don’t get a second opinion for a procedure, you may have to pay a higher percentage of the cost.

When your healthcare provider recommends surgery or a major procedure or treatment, it’s smart to get a second opinion from another expert. But, how do you know a second opinion is in order? And how do you go about getting one? Here are some answers to these and other important questions.

What Is a Second Opinion?

A second opinion means that you choose to see another doctor or specialist after you’ve received an initial diagnosis or treatment plan for a medical condition. The second doctor reviews your medical history and gives their interpretation of your health. They will give you their view on your diagnosis or treatment plan. They may suggest different treatment options than the first doctor you saw.‌

Your doctor is usually comfortable with your decision to get a second opinion. Getting a second opinion is a good idea when you have a medical issue. In fact, you might find that your general doctor will refer you to a specialist or encourage you to see another doctor before you even ask.

When should you get a second opinion?

Don’t waste time checking out choices if you need emergency treatment. But if your healthcare provider suggests nonemergency surgery or a major medical test, it can be worthwhile to get a second opinion for any of the following reasons:

• Your health insurance requires a second opinion.
• Your diagnosis isn’t clear.
• You have a lot of medical conditions.
• The treatment offered is experimental, controversial, or risky.
• You have a rare condition.
• You have a life-threatening condition.
• You have many treatments to choose from.
• You’re not responding to treatment.
• You feel like you can’t talk to your current doctor.
• Your doctor says they can’t help you or won’t treat you.
• Your doctor doesn’t specialize in your condition.
• You want peace of mind.

Just feeling uncertain about having surgery or a major procedure may be reason enough. After all, no one healthcare provider knows everything about all conditions, or about all the new breakthroughs in treatment being reported.

Where to start?

If you choose to go for a second opinion, it’s a good rule to ask someone with at least the same level of skill and knowledge of your health condition as your current health care provider. Consider contacting a specialist. Your current healthcare provider may be able to suggest someone.

Even better, ask someone at an institution specializing in your condition, like a cancer treatment center or a heart surgery center. These centers will have the latest in healing technology, and a team of experts may be readily available to review your case.

What should you tell your healthcare provider?

Most healthcare providers will acknowledge their patients’ right to a second opinion, so you just need to be honest and straightforward.

Be sure to ask for your medical records so you can share them with the second healthcare provider. By law, your healthcare provider must give these records to you. You may have to pay a fee to have the copies made.

What should you ask the second healthcare provider?

These questions offer a good place to start:

• Is the diagnosis correct?
• What are my choices, and the pros and cons of each?
• What would happen if I waited or chose no treatment?
• What should I do with the results?

If the second healthcare provider agrees with the first, you can move forward with more confidence.

How to Get a Second Opinion?

The best place to start the process is with your general doctor. If they haven’t offered you a referral to a specialist, ask for one. If you’re already seeing a specialist, ask to see another doctor who has at least the same level of training and expertise and who isn’t their close peer.‌

If you feel you can’t ask your current doctor, there are other ways to get a second opinion. You can try:

• Asking your insurance provider to recommend a specialist
• Asking a local clinic for a recommendation
• Asking a local hospital for a recommendation
• Searching a medical association for a specialist near you‌

Also check with your insurance company to make sure your second opinion is covered and if there are any special instructions.

After Your Second Opinion

Getting a second opinion can help you make better health decisions. If the second doctor agrees with the first, you may decide to return to your first doctor and move forward with your treatment. You can also ask your doctors to work together as a team. If their opinions are different, you can use the new information to help you make the best choice for you.

What is mandatory second opinion?

The amount you must pay for health care or prescriptions before Original Medicare, your Medicare Advantage Plan, your Medicare drug plan, or your other insurance begins to pay.

Do patients have a right to a second opinion?

You have the right to receive a second opinion when you or your doctor request one. You have the right to have your doctor freely discuss your medical treatment options and care with you, without interference or restrictions by your health plan.

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What is the Difference between Urgent Care and Emergency Room?

Urgent care can treat minor fractures, nonemergency x-rays, back pain, and cold and flu symptoms. At the same time, the emergency room may treat more severe conditions, such as chest pain, heart attack symptoms, and difficulty breathing.

Whether you go to urgent care or the emergency room depends on the medical situation you are in. If you are in an emergency, you should always go to the emergency room because urgent care cannot provide the level of care you may need. If you are not experiencing an urgent medical situation and the hours are between 8 AM and 5 PM (unless the center is open later or earlier), you may want to consider visiting an urgent care center.

When and Why Insurance Deny Emergency Room Claims?

When patients use non-ER facilities, it’s less costly for the Insurance, and that translates into lower overall healthcare cost—and lower insurance premiums—for everyone. But in the case of a life- or limb-threatening condition, an emergency room will likely be the only place that’s properly equipped to handle certain conditions.

Do Urgent care centers accept insurance?

It is up to the insurance provider whether they cover urgent care centers or not. However, many insurance providers cover urgent care visits, but patients will be expected to pay the co-pay or deductible implied by their plan.

You should also be aware that an urgent care center may choose not to accept your insurance, even if your insurance provider would otherwise pay for the care. This could be avoided by calling the urgent care center ahead of time and asking if they accept your insurance.

Look Up for “Self-pay” Rates

Websites such as Healthcare Bluebook, FairHealth and SolvHealth allow you to get an estimate of how much your urgent care visit is going to cost. The self-pay rate is the charge set by clinics for patients without insurance. It may also be possible to get a payment plan.

Call Before You Go

Calling ahead of time allows you to check for available time slots and leads to a better understanding of how the urgent care center charges patients without insurance. While calling beforehand, you may want to ask about their pricing for patients paying out of pocket.

Ask the Right Questions

When going for your visit, make a list of questions regarding pricing and services for the visit. Here are some examples:

• How much will this test cost?
• If I need an x-ray or additional testing, how much will it cost?
• Is this the only test I need for today?
• How much will this prescription medicine cost?
• Is there an office visit fee?
• What other administrative fees can I expect?
• Are there separate charges for the office visit and in-house lab tests?
• Is there a bundle price for certain services?

Health Insurance Claim Denial Reasons

An Insurance might deny your claim for several reasons:

• A provider or facility isn’t in the health plan’s network.
• A provider or facility didn’t submit the right information to the Insurance.
• A health plan needed more information to pay for the services.
• A health plan didn’t deem a procedure medically necessary.
• A clerical error.

How to appeal health insurance claim denial?

Here are seven steps for winning a health insurance claim appeal:

1. Find out why the health insurance claim was denied.
2. Read your health insurance policy.
3. Learn the deadlines for appealing your health insurance claim denial.
4. Make your case.
5. Write a concise appeal letter.
6. Follow up if you don’t hear back.

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it is difficult to know how much an urgent care visit costs without insurance because every facility and company will charge differently depending on the services you’re receiving.

The Average Costs for Different Services at Urgent Care

 Office Visit Cost

Average Out of Pocket Urgent Care Costs in Major Cities*

*These costs reflect the office visit cost, 1 test (ex: rapid flu, strep tests). Additional testing could range between $15-60 per test.  An x-ray could cost an additional $65, and higher-level services could add $99 or more.

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Understand Insurance Denial Code CO 64: Denial Reversed per Medical Review

1. Reversed Claim means a Claim that initially is paid but a subsequent Claim with the same Pharmacy, Covered Individual, prescription number, and NDC was submitted for reversal of payment.
2. Reversed Claim means a previously Paid Claim, that was submitted by the pharmacy to the PBM in a Billing Transaction requesting a reversal of the previously paid Transaction and processed as an accepted Reversed claim, as indicated in the PBM’s response Transmission.

Reasons for Denial Reversals

Reversals can happen for a myriad of legitimate and not so legitimate reasons. In a recent study, the top reasons for medical billing reversals are as follows:

1. Incorrect payable diagnoses codes, the biggest offenders in this category were:
   Modifier 59 – distinct procedural service
   Modifier 76 – repeat procedure by same physician
   Modifier 24 – unrelated evaluation and management service by same physician during postoperative period
   Modifier 25 – significant separately identifiable evaluation and management service by same physician on the day of a procedure.
2. Provider Billing Errors – As long as medical billing is coded by humans, there will be errors, that’s just a fact and provider errors were the number two cause of reversed billing. The different types of billing were:
   Correct quantity billed – often times the amount of services rendered is miscalculated;
   Correct procedure code – this one can be difficult, that is why outsourcing your medical billing to a partner is a great idea;
   Correct billed amount – another big issue, incorrect pricing will get your medical billing claims rejected.
3. Medical Review – The biggest reason for reversals of payment was lack of documentation to support medical necessity for the following procedures ambulance service;
   frequency of bone mass measurement;
   to support medical necessity of critical care same day.

How to Avoid Health Insurance Reversal?

In some cases, decisions can be reversed – leaving patients holding the bag – even years later.

“For example, if you have 2 health plans – yours and your spouse’s – and the one that should have paid second actually paid first, they will go back and reverse their payments years later,” explains Jennifer Jaff, Executive Director of group called Advocacy for Patients with Chronic Illness. “It’s a huge nightmare for consumers, but it happens. “

If an insurer denies your claim either before or after treatment, you do have the right to appeal: It’s guaranteed, under the health care law that president Obama signed in March, 2010. Of course a guarantee of appeal is no guarantee that the appeal will be successful.

Fortunately, there are things you can do to minimize your risk:

1) Make sure you’re pre-approved. Unless you’re in the midst of an emergency, talk to your doctor to make sure any treatment – especially an expensive one – is pre-approved. That means your doctor has talked with your insurance company in advance, and received a promise that the treatment will be paid for.

2) Get help. Your doctor, hospital business office or employee benefits office can be a lot more powerful in making an appeal than you are alone. You can also get help from non-profit groups like Advocacy for Patients with Chronic Illness, or the Patient Advocate Foundation.

3) Be persistent. “You may go through three or four levels of appeals before you get a favorable resolution,” says Nancy Davenport-Ennis, co-founder of the Patient Advocate Foundation.

4) Use the right words. Certain words will trigger a denial. For example, sometimes insurance companies refuse to pay for surgeries related to cleft lip or palate, saying it’s not medically necessary. When parents appeal saying the child needs the surgery for “cosmetic” reasons or to “enhance esteem,” the appeal often fails, according to cleft Advocate, a group that works with families. Appeals that mention problems with “biting,” “chewing,” or “swallowing” are more likely to work.

5) You may need a lawyer. If all else fails, there are attorneys who specialize in insurance cases.

It’s worth saying, not all insurance denials are unreasonable. Coverage guidelines “are created by physicians who assess medical evidence, medical outcomes and overall health benefits to patients,” says Aaron Bilger, a spokesman for Highmark. “It’s to protect you.”

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Understanding Claim Adjustment Reason Code 69 – Day Outlier Amount

An outlier payment is an additional form of reimbursement made to the 60-day case mix–adjusted episode payments. It is applied for beneficiaries who incur unusually large costs due to requiring supplementary services to meet their care needs.

For the provider to be eligible, imputed episode costs must exceed the payment rate by 0.67 times the standard base payment amount (a portion of which is adjusted for local wages), Griffin adds. Episode costs are imputed by multiplying the estimated national average per-visit costs by the type of visit (which is adjusted to reflect local input prices) by the number of visits by type during the episode.

“When the estimated costs exceed the outlier threshold, the HHA receives a payment equal to 80 percent of the difference between the episode payment with the threshold and the episode’s estimated costs. This is paid on the final payment to agencies,” explains Griffin. “If an agency hopes to achieve a healthy bottom line, it must eliminate outliers from the category of revenue boosters. Except for a few rare instances, outlier payments seldom bridge the gap between costs and profits.”

Outlier Threshold:

The upper range (threshold) in length of stay before a client’s stay in a hospital becomes an outlier. It is the maximum number of days a client may stay in the hospital for the same fixed reimbursement rate. The outlier threshold is determined by the Centers for Medicare and Medicaid Services (CMS), formerly known as the Health Care Financing Administration (HCFA).

Cost outlier — an inpatient hospital discharge that is extraordinarily costly. Hospitals may be eligible to receive additional payment for the discharge. Section 1886(d)(5)(A) of the social security act provides for Medicare payments to Medicare-participating hospitals in addition to the basic prospective payments for cases incurring extraordinarily high costs.

Timetable for coding inpatient cost outlier claims:

Cost outlier -an inpatient hospital discharge that is extraordinarily costly. Hospitals may be eligible to receive additional payment for the discharge. Section 1886(d)(5)(A) of the social security act provides for Medicare payments to Medicare-participating hospitals in addition to the basic prospective payments for cases incurring extraordinarily high costs.

• To qualify for outlier payment, a case must have costs above a fixed-loss cost threshold amount (a dollar amount by which the costs of a case must exceed payments to qualify for outliers).
• Total covered charges for an inpatient admission are $100,000 (hospital costs)
• The prospective payment system (PPS) threshold amount for the DRG is $65,000 (fixed-loss threshold amount)
• CMS publishes the outlier threshold amounts in the annual inpatient prospective payments system (IPPS) final rule. Providers may access CMS’ website to download the IPPS pricer.

Inlier — a case where the cost of treatment falls within the established cost boundaries of the DRG payment. To determine if the inpatient hospital claim meets the criteria for cost outlier reimbursement, two pieces of information are needed: 1) total covered charges and 2) PPS threshold amount. If the total covered charges exceed the PPS threshold amount, follow the coding rules for inpatient cost outlier claims.

DRG cutoff day — the “To” date or “End” date of the inlier period. Once the PPS threshold amount is known add the daily covered charges incurred by the patient until determining the day that covered charges reach the cost outlier threshold amount. Exclude days and charges during non-covered spans (e.g., occurrence span code 74 [non-covered level of care], 76 [patient liability], 79 [payer code] dates).

Occurrence code (OC) 47 — a code that indicates the first day the inpatient cost outlier threshold is reached or the date after the DRG cutoff date. For Medicare purposes, a beneficiary must have regular coinsurance and/or lifetime reserve days available beginning on this date to allow coverage of additional daily charges for the purpose of making cost outlier payments. OC47 date cannot be equal to or during dates coded for occurrence span code 74, 76, or 79.

Occurrence code A3 — (Benefits exhausted) the last date for which benefits are available and after which no payment can be made.

Occurrence span code 70 — a code and span of time that indicates the from and through dates during the PPS inlier stay for which the beneficiary has exhausted all regular days and/or coinsurance days, but which is covered on the cost report.

Condition code 61 — a code that indicates this bill is a cost outlier.

Condition code 67 — a code that indicates the beneficiary has elected not to use lifetime reserve (LTR) days.

Condition code 68 — a code that indicates the beneficiary has elected to use lifetime reserve (LTR) days.

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