Medicare and Medicaid are two government-funded health care programs in the United States that provide medical assistance to eligible individuals. Medicare is a federal health insurance program primarily designed for senior citizens aged 65 or older, but it also covers people with certain disabilities or medical conditions. Medicaid is a joint federal-state program that provides health care coverage for low-income individuals and families, including children, pregnant women, and people with disabilities. These programs ensure that individuals have access to the medical care they need, regardless of their financial situation or health status.
Medicare and Medicaid help millions of Americans every year to receive health care services that they otherwise would not be able to afford. This support is especially important for elderly people and people who have a disability, who may have chronic health conditions and require ongoing medical care. Medicaid provides a safety net for low-income families and children who might not have access to health care otherwise. Without these programs, many people may have to go without necessary treatments.
In the following sections, we explore the Medicare and Medicaid billing process, which is a crucial aspect for any providers who contract with one or both of these programs. It’s especially important in the human services sector, where state policy coverage changes frequently with each administration.
Medicare and Medicaid Billing
The Medicare and Medicaid billing process refers to the method for health care providers to submit claims for reimbursement of services provided to eligible beneficiaries. It’s highly regulated and complex, as different rules and requirements apply to each program. Medicare reimbursement rates are set by the federal government and vary depending on the type of service provided, while Medicaid reimbursement rates are determined by each state. Understanding the Medicare and Medicaid billing process benefits providers and participants alike, as it helps to ensure that medical services are reimbursed appropriately, and that beneficiaries receive the care they need to stay healthy.
Service providers across the mental health, behavioral health, substance abuse, and housing sectors may be less familiar with the process than traditional medical providers. Streamlining your agency’s administrative workflow for eligible clients requires a thorough understanding of the rules and regulations set by the Centers for Medicare & Medicaid Services (CMS) and the various components of billing and coding. It can be a daunting task for newer or smaller agencies, but ensuring the reimbursement process runs smoothly and efficiently helps participants receive the care they need without undue financial burden. Below is an explanation of each billing system:
Medicaid Billing Guidelines
Health care providers who participate in Medicaid must follow strict guidelines to ensure accurate and timely payment for their services and avoid fraud. Here are some Medicaid billing guidelines that providers should be aware of:
- Verification of Medicaid coverage: Before providing any services, health care providers should verify that the services are covered by Medicaid. This can be done by checking the patient’s Medicaid card or by using the state’s Medicaid website, which provides information on which services are covered and under what circumstances. Plans vary by state, and some states utilize PPO Medicaid while others utilize HMO or managed care. Be careful to check if a referral is needed before scheduling a client for a service.
- Electronic vs. paper billing: Most health care providers can choose to bill Medicaid electronically or by paper. Electronic billing is faster, more accurate, and less expensive than paper billing. Providers who bill Medicaid electronically can also receive payment several weeks earlier. Electronic billing can be done through an internal electronic health records (EHR) system, such as Foothold, or a health care clearinghouse. Paper billing can be done by mail or fax.
- State-specific information required on Medicaid claim: To ensure timely and accurate payment, health care providers must include all necessary information on their Medicaid claim, including the patient’s Medicaid number, the service provided, the date of service, and the amount charged. All submissions need to be on the correct forms provided by the Medicaid office. Forms and submission requirements may vary slightly by state.
- State Medicaid fee schedule: Medicaid pays health care providers according to a fee schedule that varies by state. Each state’s fee schedule determines the payment amount for each service based on the type of service, the geographic location where the service was provided, and the provider’s specialty. It is illegal to charge an eligible patient more than the set fee schedule if the services are denied by the insurance.
- Medicaid as a secondary insurance: Because Medicaid is often an income-based insurance plan, most covered individuals do not have a primary insurance provider. In cases where there is primary private insurance, Medicaid serves as the payer of last resort, stepping in only when no other insurance is available to cover the cost of health care services.
- Medicaid and Medicare coverage: Medicaid also acts as secondary insurance if a patient has both Medicare and Medicaid coverage, as Medicare will generally pay first for the services rendered. Medicaid then becomes the secondary payer and pays for any remaining costs, such as copayments or deductibles.
- Payment collection: After private insurance, Medicare, and Medicaid each pay their portions, health care providers must collect the remaining amount from the patient. Providers can bill the patient for the difference between the Medicaid-approved amount and the actual Medicaid fee schedule amount. Avoid any chance of fraud by paying close attention to the limits on how much providers can charge, and follow Medicaid guidelines closely for collecting payment from participants.
Medicare Billing Guidelines
Medicare billing, coding, and guidelines vary depending on the specific part of Medicare being billed for. You should always verify coverage by checking the Medicare Coverage Database or by contacting the patient’s Medicare Administrative Contractor (MAC). Here is an overview of the billing guidelines for each part of Medicare:
- Part A: Medicare Part A covers inpatient hospital care, skilled nursing care, and hospice care. Providers should include information such as the person’s Medicare number, date of admission, and diagnosis codes. Providers must also make sure that the services they provide are medically necessary and covered by Medicare.
- Part B: Medicare Part B covers outpatient medical services such as doctor visits, lab tests, and medical equipment. Providers must also make sure that the services they provide are medically necessary and covered by Medicare.
- Part C: Medicare Part C, also known as Medicare Advantage, is a type of health plan offered by private insurance companies that provides coverage for Parts A and B services. Providers should bill Medicare Advantage plans directly using the plan’s billing instructions. Medicare Advantage plans often have different billing guidelines and requirements than traditional Medicare, so health care providers should familiarize themselves with each plan’s specific instructions.
- Part D: Medicare Part D covers prescription drugs. Providers should submit claims for Part D drugs to the assigned prescription drug plan using the instructions. Health care providers should also ensure that they have obtained a written order from the patient’s physician before providing any non-emergency services. Remind clients of the Medicare Part D coverage gap, which occurs when a person is responsible for a greater portion of the prescription costs until they reach the threshold.
Similarities and Differences Between Billing Medicaid and Billing Medicare
Although both Medicare and Medicaid are government-funded health care programs in the United States, their billing processes and guidelines differ in several ways. One similarity is the importance of verifying coverage before providing services. Both programs require health care providers to include specific information on claims to ensure accurate and timely payment, such as the place of service, the National Provider Identifier (NPI) for the individual practitioner or organization, the procedures performed, and the diagnoses listed. Additionally, providers can choose to bill both programs electronically or by paper.
However, there are also notable differences. Medicare pays according to a fee schedule determined by the Centers for Medicare and Medicaid Services (CMS), while Medicaid pays according to a fee schedule determined by each state. Additionally, Medicaid is generally the primary payer for participants who have both Medicaid and Medicare coverage, whereas Medicare is always the primary payer for participants who have both Medicare and private insurance coverage. Finally, Medicaid provides more extensive coverage for long-term care services and disability services, while Medicare provides more extensive coverage for acute care services.
Billing for Dual Eligible Beneficiaries
Dual eligible beneficiaries refer to individuals who are eligible for both Medicare and Medicaid coverage. Generally, these individuals are low-income seniors over 65 years old or individuals with disabilities who qualify for Medicare due to a disability and Medicaid due to their low-income status. In some cases, younger individuals with certain chronic conditions may also be eligible for dual coverage. These individuals often have complex health care needs and require frequent medical attention, which can be expensive. Dual eligibility helps ensure that they have access to the medical care and services they need without facing financial hardship.
When a beneficiary has dual coverage, health care providers must bill Medicare and Medicaid separately. Since these programs have different coverage rules and payment structures, and billing them together can result in delayed or incorrect payments. When billing dual eligible beneficiaries, providers must bill Medicare first as it is the primary payer. If Medicaid also covers the service, providers can bill Medicaid for any remaining costs. Providers can use the Medicare crossover process to submit claims to both programs simultaneously. Follow state-specific Medicaid fee schedules and ensure all required information is included on the claim form to avoid payment delays.
Recent Developments in Medicare and Medicaid Billing
In recent years, the Centers for Medicare and Medicaid Services (CMS) have implemented several initiatives to streamline the Medicare and Medicaid billing process and reduce errors. One such initiative is the Medicare Administrative Contractor (MAC) program, which consolidates the processing of Medicare claims to a single entity in each jurisdiction. This program has led to increased efficiency, faster claim processing times, and reduced errors.
Another initiative is the Medicare Access and CHIP Reauthorization Act (MACRA), which includes provisions to simplify billing procedures and encourage providers to use electronic health records (EHRs). Under MACRA, providers can receive incentives for using certified EHRs to submit claims, which can help reduce errors and improve efficiency.
Electronic billing and electronic health records (EHR) have also played a significant role in improving the accuracy of Medicare and Medicaid claims submissions. By using electronic systems, providers can reduce errors and delays associated with paper claims submissions. Electronic billing also allows for faster processing times, reducing the time it takes to receive payment.
Working with an EHR company can greatly reduce the stressors associated with Medicaid and Medicare billing. Much of the demographic information needed on the forms can be automated and duplicated for each new submission. The use of EHRs also allows providers to easily track patient care and treatments, leading to more accurate claims submissions. This is especially helpful when standard reimbursement provisions or denial kickbacks from the office request more detailed documentation, such as intake form attachments or service notes.
Advanced EHR features may also give care providers access to a person’s medical history outside their agency, which can help ensure that the services provided are covered by Medicare or Medicaid with regard to medical necessity. Overall, the integration of electronic systems in the billing process has streamlined the process, making it easier for health care providers to bill for services and for CMS to process claims.
Coding and Billing for Medicaid in Review
Health and human service providers who participate in Medicaid or Medicare must adhere to strict billing guidelines to ensure accurate and timely payment for their services. Get familiar with these guidelines and stay up to date on any changes to the programs’ policies and procedures. By doing so, you can provide quality care to your participants, coordinate care with primary physicians and other practitioners, and avoid fraud or potential penalties for non-compliance. Working with a wrap-around EHR service provider and consultant like Foothold Technology can help you best prepare for all the administrative tasks associated with coding, billing, and claims submissions.