Coordination of Benefits (COB) among multiple insurance carriers is a significant service you provide to some of your clients. Many of you appear to be having difficulties with claims for secondary carriers in your electronic filing with Emdeon. I will walk you through the process so you are clear about how to bill secondary claims electronically.
1. Primary Payer – Regardless of whether the initial claim was sent on paper or electronically to the Primary Payer, you must have an NEIC Payer ID entered in SOS Office Manager for that payer. To enter the NEIC Payer ID in OM, go to Lookups > Insurance Carriers and find your Primary Payer. Once you have found it, click on the pencil icon to make a change and then go to the Additional Tab. Once there, find the NEIC/Payer # field and enter the appropriate NEIC Payer ID. If you do not have one entered, the Claim Adjustment Reasons (CARs) will not appear on the electronic secondary claim. (Look on the Emdeon Payer List to get the payer ID. www.emdeon.com > Payer Lists > Medical/Hospital/Dental Payers) If the Primary Payer is not on the list enter SPRNT.
2. Secondary Payer – Go to Lookups > Insurance Carriers/Plans, select your Secondary Payer and click Edit > Additional tab. Check the radio button in front of ‘Amount received from other insurance’ in the section entitled ‘For CMS amount paid (box 29)’.
3. Payment by the Primary Payer – The Primary Payer will either pay or reject your claim. If they pay, they will often diminish the payment by certain amounts called Claim Adjustments. As you enter the Primary Payer’s payment or transfer the balance from the Primary Payer to the Secondary Payer, you must also enter the Claim Adjustment Reasons (CARs) that appear on the Explanation of Benefits (EOB). When entering the payment, apply the money to the date of service; the screen below will pop up….click on the Claim Adjustment Reasons icon to enter the CARs.
NOTE: If you have to go back and enter the CARs after posting the primary payment has been completed, you can do so very easily. Go to the client’s ledger. Double-click on the date of service for which you need to enter the CARs. Once the transaction is open, double-click on the split to the primary insurance and click on the Claim Adjustment Reasons icon.
4. Detail the Claim Adjustment Reasons (CARs) – The next step is to decide what the total amount of the adjustments is and what dollar amount is accounted for by each of the individual CARs. Here is a simple rule to use to determine what the total amount of the CARs will be:
Service Fee – Primary Insurance Payment = Total CARs
Example One: Your fee for a service is $150.00; the primary insurance company paid $80.00. If you subtract $150.00 – $80.00 you are left with $70.00. All of the Claim Adjustments (CARs) for the primary payer should total $70.00.
What is accounted for in the CARs? The CARs are the reasons given by the payer for not paying your entire fee. You must enter the primary payer’s reasons and the specific adjustments or transfers so that the primary payer’s CARs can be included in the secondary claim. You will indicate if there was an adjustment made by the primary insurance for contractual reasons, if there was a patient responsibility for the service, if there was a disallowed amount, or any other reason the primary payer indicates.
To continue the example from above: The fee for the service is $150.00 and primary insurance paid $80.00. The primary insurance contractually allows only $110.00 for the service provided so they made an adjustment of $40.00. The patient had a copay of $10.00 on this service and coinsurance of $20.
Using the formula above,
FEE – PRIMARY PAYMENT = CARs
$150.00 – $80.00 = $70.00 ($40.00 + $10.00 + $20.00)
So we are now ready to enter the information in Claim Adjustment Reasons. On your EOB, you will see that each adjustment has a Group Code and a Reason Code. To enter the $40 adjustment, select the group code CO for Contractual Obligations. Then right click in the box under Reason Code and select 45 (Charges exceed your contracted/legislated fee arrangement. This change to be effective 6/1/07: Charge exceeds fee schedule). Under Amount, enter $40 and under Total Unit Paid, enter 1.
Next you will be left to account for the patient copay of $10.00 and the patient coinsurance of $20. You will enter PR as the ‘Group Code’ for Patient Responsibility. Then use Reason Code 3 (Copay amount) and $10.00. The Total Unit Paid will be 1. Enter a second line with Reason Code 2 (Coinsurance Amount), $20.00 and Total Unit Paid equal 1.
So now when you look at that screen for the Claim Adjustment Reasons you will see the following:
The claim now balances and you have accounted for the full amount of the fee.
Example Two: The fee for the service is $150.00 but the primary insurance did not pay anything because it went towards the patient’s deductible. $150.00 – $0.00 = $150 (Fee – Primary Payment = CARs), so you need to account for the full $150.00. The EOB indicates the same maximum allowable for the service as in Example One, $110.00. The EOB indicates nothing about copay. So you will enter a $40.00 fee adjustment (CO, 45) and $110 will be entered as PR, 1 (Patient Responsibility, Code 1). The total CARS will equal $150.00. Your Claim Adjustments screen will show:
5. Generating the claim – check the box ‘Remove punctuation from data’ when you generate the claims. This should be checked regardless of whether you are generating primary or secondary insurance. In OM, go to Bills/Claims > Create HCFA/CMS 1500 Claims > highlight your option for ANSI – Emdeon and then click on Create and Output New Batch.
PLEASE NOTE: Some insurance carriers may have different requirements for how you enter the CARs. If you find that your secondary claims are being rejected for any reason that you cannot understand, you must speak to the secondary carrier for more information regarding the rejection.
