CPCA CPCA Reimbursement and Payer Policies 1 — Questions and Answers
Question 1: Which term describes the maximum amount a payer will reimburse for a specific service based on fee schedule data?
- Allowed amount (Correct answer)
- Billed charge
- Deductible
- Copayment
Correct answer: Allowed amount
The allowed amount is the maximum the payer will pay for a covered service under their fee schedule.
Question 2: A dermatology practice submits a claim and receives a payment that is less than the billed amount with no explanation. What should the biller do first?
- Write off the balance
- Request an Explanation of Benefits (EOB) (Correct answer)
- Bill the patient immediately
- Resubmit the claim with a higher amount
Correct answer: Request an Explanation of Benefits (EOB)
Requesting the EOB is the first step to understand why the payer reduced or denied the payment.
Question 3: Which type of payer plan typically requires patients to select providers from an approved network to receive full benefits?
- Indemnity plan
- Health Maintenance Organization (HMO) (Correct answer)
- Worker's Compensation
- TRICARE
Correct answer: Health Maintenance Organization (HMO)
HMOs require members to use in-network providers to receive covered benefits, unlike indemnity plans.
Question 4: What is the term for the process of verifying a patient's insurance coverage and benefits before services are rendered?
- Authorization
- Eligibility verification (Correct answer)
- Credentialing
- Claims adjudication
Correct answer: Eligibility verification
Eligibility verification confirms the patient's active coverage, deductibles, and benefits prior to the appointment.
Question 5: A payer requires prior authorization for a laser skin resurfacing procedure. What happens if the provider performs the service without obtaining it?
- The claim is automatically paid at 50%
- The claim may be denied entirely (Correct answer)
- The provider is penalized by the state board
- The patient's deductible is waived
Correct answer: The claim may be denied entirely
Performing a service without required prior authorization typically results in full claim denial by the payer.
Question 6: Which Medicare administrative document outlines covered services, billing requirements, and payment rules for specific specialties?
- UB-04 form
- Local Coverage Determination (LCD) (Correct answer)
- ABN form
- CMS-1500
Correct answer: Local Coverage Determination (LCD)
A Local Coverage Determination (LCD) is issued by Medicare Administrative Contractors to define coverage criteria for specific services.
CPCA CPCA Reimbursement and Payer Policies 1
Which term describes the maximum amount a payer will reimburse for a specific service based on fee schedule data?