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Interpreting the Remittance Advice
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“Look at the amount we billed. Look at what the insurance company allowed. Write off the difference and bill the patient or the second insurance the difference.”

Those words were the only training I received when I started processing the explanations of medical benefits now referred to as remittance advice (RA). The reality is there is so much more to know.

undefinedI participated in an AMA webinar during which the speaker said that the average physician leaves 3 percent to 12 percent of revenue on the table. Inappropriate billing, but also making incorrect write-offs, can contribute to this revenue loss.

What should you be looking for when you process a RA?

  • Did the insurance company change the CPT code you submitted? Offices report commercial payers downcoding 99214 to 99213, for example, based on a diagnosis code they think does not qualify for a level-4 established patient.
  • Did the insurance company allow the full amount you charged? If you intentionally billed what you’ve confirmed they allow, that’s one thing. But if you have no idea of the insurance allowable, often they would have allowed more — if your charge had been higher.
  • Was the claim denied due to a missing or inappropriate modifier? Don’t resubmit with the same modifier. Don’t call the insurance company asking which modifier you should have used. They are not coders. Send your question to ecode@list.aao.org and let the Academy help you discover the correct modifier.  
  • Are you double-checking procedure productivity reports? A physician was recently subject to a focus medical review audit for CPT code 99214. He was surprised because he only bills comprehensive eye exams — 92014. Seems a staff person was submitting the E&M code rather than the Eye Code each time — with all payers. Had the physician reviewed procedure productivity reports or RAs, he would have noticed the error immediately.

In addition to the RA errors detailed here, Gaye Baker, OCS, reimbursement coordinator for Mason Eye Institute, reports that her practice has been seeing more DB10 denials. The following is an explanation sent to their staff to alert them to some of the potential problems.

The DB10 denial is usually related to a coding issue, which has resulted in an underpayment on the charge. Some of the DB10 denials seen are valid due to multiple fee reductions and can be verified by reviewing the Medicare Fee Schedule.

Here are some of the scenarios you may see.

  • Timing issue: We are in multispecialty practice. Occasionally a patient is seen during the postop time, but since the surgery hasn’t been posted, the biller submits the office visit when it is really postop. As a result, the office is paid and the surgery payment is reduced with the DB10 comment “allowed amount reduced” because a component of the basic procedure/test was paid. To correct this, we must refund the visit payment, and after that is accomplished, request the additional surgical amount.
  • Billing an E&M code the day before or the same day as a procedure without appending the -25 or -57 modifier: A patient is seen by two different ophthalmic specialists the same day and the second physician performs a surgical procedure. The surgeon appended the correct modifier, but the first physician did not. As a result, surgery allowable was reduced. To correct this, we must resubmit the visit with the appropriate modifier (often this is accomplished by telephone reopening) once processed, then request the additional surgical amount.
  • Patient enrolled in hospice: DB-9 services are not covered because the patient is enrolled in hospice. When this occurs, add modifier – GW, as service provided is not related to patient’s condition.

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About the author: This article has been adapted from the original version, written by Academy Coding Executive Sue Vicchrilli, COT, OCS, which appeared in the April/May and June 2011 issues of Coding Bulletin.

 
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