Insurance Verification & Prior Authorization Flashcards

In a managed care plan, what is a referral?

Answer: An authorization from a PCP directing a patient to see a specialist

In HMO and some managed care plans, a referral is the PCP's formal direction for the patient to receive specialist care, which is required for insurance to cover the specialist visit.

What is Medicare Part B primarily responsible for covering?

Answer: Outpatient medical services, physician visits, and preventive care

Medicare Part B covers outpatient services including physician office visits, preventive screenings, durable medical equipment, and outpatient therapy.

Which federal program provides health coverage primarily for low-income individuals and is jointly funded by state and federal governments?

Answer: Medicaid

Medicaid is a means-tested program jointly funded by federal and state governments that provides health coverage to eligible low-income adults, children, pregnant women, and people with disabilities.

When a patient seeks care from a provider outside their HMO network without a referral, what is the MOST likely outcome?

Answer: The claim will be denied or the patient will bear the full cost

HMO plans generally do not cover out-of-network services except in emergencies; the patient is financially responsible for the full cost when proper referral and network requirements are not met.

What is the 'birthday rule' used to determine in insurance?

Answer: Which parent's plan is primary for a child covered under both parents' policies

The birthday rule states that when a child is covered under both parents' plans, the plan of the parent whose birthday falls earliest in the calendar year is primary.

What does 'Assignment of Benefits' mean on a CMS-1500 claim form?

Answer: The patient authorizes the insurer to pay the provider directly rather than the patient

When a patient signs an assignment of benefits, they authorize their insurance company to send reimbursement payments directly to the healthcare provider instead of to the patient.

A medical administrative specialist calls the insurance company to verify benefits and is told the plan has a $30 copay and 80/20 coinsurance after the deductible. What does 80/20 coinsurance mean?

Answer: Insurance pays 80% and the patient pays 20% of covered costs after the deductible

In an 80/20 coinsurance arrangement, the insurance plan pays 80% of the allowed amount after the deductible is satisfied and the patient is responsible for the remaining 20%.