Eligibility: What You Need to Know
Protect the financial livelihood of your practice
through coverage verification and balance collection.
Making sure your practice is paid in full for services rendered is a two-step process: First, verify every patient’s eligibility for medical coverage before services are rendered. The turnaround time for claims payment is reduced greatly when coverage is verified prior to services. This step alone will improve cash flow for the practice. Second, collect the remaining balance from the patient. Practices who do not perform these two essential steps during check-in only recover approximately 30 percent of patient balances. That’s 70 percent of potential revenue the practice will never see.
Verify Coverage at Check-in
To verify coverage, you’ll need the patient’s:
- Name and address
- Date of birth
- Primary insurance company
- Policy number
- Group number
You’ll also need the policy owner’s name and date of birth, and the patient’s relationship to the policy owner. Obtain the policy start and end dates, as well.
Tip: Be sure to verify coverage for the specific date of service!
Don’t Forget Secondary Coverage
Don’t forget to ask the patient for any secondary coverage. Verify this coverage, as well. Patients with secondary insurance often don’t understand how two insurances work and may give you the wrong one.
Note that Medicaid is always the payer of last resort. If a patient is covered under a commercial payer and a Medicaid payer, the Medicaid coverage is secondary (regardless of how the patient wants the claim to be processed). If the patient does not want to send the claim to their primary insurer, they must pay cash.
If a husband and wife each have coverage for themselves and each other, the policy the individual owns is primary and the policy owned by the spouse is secondary. For instance, the husband has UnitedHealthcare® (UHC) and his wife has Blue Cross® Blue Shield® (BCBS). She uses her BCBS as primary and his UHC as secondary. He uses UHC primary and BCBS secondary.
Understand the “Birthday Rule”
If parents have dual coverage on their children, the parent with the birthday earliest in the year is primary. For example, Mom has BCBS and is born in June and Dad has UHC and is born in November; Mom’s BCBS is primary for the children. The year of birth doesn’t factor in — only the day and month of birth. The National Association of Insurance Commissioners states, “If the parents have the exact same date of birth; the oldest policy is primary.” Be sure to check specific payer guidelines and coverage, as well as COBRA coverage and coverage for divorced parents.
Benefits Matter as Much as Coverage
In addition to verifying coverage, also verify the patient’s benefits and how they relate to your practice and the treatment the patient is receiving.
Many insurance plans impose a limit to benefits received or the number of specialty visits that are covered. For example, a plan may limit the number of chiropractic visits a patient can have each year.
Alternatively, the plan may have a dollar limit. For example, some plans have a lifetime maximum of in vitro fertilization (IVF) treatment. If you are an IVF specialist, this is important information to know up front.
Another consideration is how mental/behavioral health claims are processed. Is there a separate address or Electronic Data Interchange (EDI) number? Are these benefits handled differently? Ascertain what services are covered and how the claims are processed as they relate to your specific practice and the services being provided.
Benefits also may differ based on the place of service. If services will be provided in a location other than the physician office, will that affect the patient’s benefits and claim processing? Find out.
In verifying coverage, you are able to determine what, if any, costs will fall to the patient. For example:
- Does the patient have a deductible? If so, is the deductible met? How much is remaining?
- Will any services provided be applied to the patient’s deductible?
- How is the deductible calculated? On a calendar year or on a plan year? If it’s the plan year, obtain the start and end dates of the plan.
- Is there a co-payment? How much?
- Are you contracted as a specialist, requiring a higher co-pay amount?
These are important questions to answer so the patient is informed of their financial responsibility before receiving treatment; and so the right amount is collected from the patient at the time of service. This step reduces aging accounts and increases practice cash flow.
Now that You Know Why, Here’s How
Verifying eligibility can be done a couple of different ways:
- Electronically: Either go through the payer’s secure portal on their website, or through the practice clearinghouse practice management software. Either way, print the electronic report showing the date and the time. If eligibility for that specific date ever comes into question, there’s a paper trail supporting the transaction. Verify the EDI number for the plan, as well.
- Phone: Another option is to call each payer to verify eligibility and benefits. Be sure to document the date and time of the call, as well as the representative’s name. To ensure the claim is submitted to the correct place, verify the phone number and address for the particular plan, as well as the EDI number. Phone is usually the best way to verify benefits for a specific procedure.
Once Isn’t Enough
On an annual basis, update each patient’s demographics and verify eligibility and benefits. At each subsequent visit, verify eligibility and benefits related to the visit.
Beth Timpson Schleeper, CPC, CPCO, CPB, CPMA, CPPM, CPC-I, CEMC, has worked in the medical billing and coding industry for almost 20 years. She owns and operates T & T Consulting Firm (www.medicalbillingphoenix.com), a full service medical billing service, specializing in medical chart auditing, practice management, credentialing, and education. Schleeper also owns Advanced Coding Services (www.advancedcodingservices.com), T & T’s educational component, which offers Certified Professional Coder (CPC®) courses and other AAPC courses. She is a member of the Scottsdale, Ariz., local chapter.