Creating a Carrier Plan Exception

Carrier Plan Exceptions (Plan Exceptions for short) is a way of making accurate entry of charges as efficient as possible, even if a patient has an insurance plan that requires an unusual allocation of insurance and patient responsibility or mandates a maximum allowable fee that is lower than you normally charge. (Note that in older versions of SOS, Plan Exceptions were called “Carrier Exceptions”.)

Medicare is the poster child for insurance coverage that requires special handling for each covered service, and SOS Plan Exceptions are the best way to make it quick and easy to enter Medicare charges. Let’s take a look at an example, billing for an hour of psychotherapy, CPT 90837, when the patient’s primary coverage is Medicare Part B by a Medicare participating provider (PAR):

Provider’s standard fee:  $150
Medicare’s PAR Amount: $129.31
Medicare’s Actual Reimbursement Amount: $97.72

The most the (PAR) provider may charge is $129.31, so that is Medicare’s maximum allowable fee and the provider will have to write off $10.69 (the part of her standard fee above $129.31). In addition, Medicare only pays this provider $97.72 for an hour of psychotherapy, so the patient responsibility is the remaining $31.59 (max fee less insurance payment amount). The fact that these rates differ for each CPT code means that manual entry of insurance and patient portions plus the adjustment would be tedious and error-prone drudgery for every single service entered for Medicare patients. Instead, SOS’s Plan Exceptions give you a place where you can store the critical amounts one time so that the splits and adjustments can be automatically calculated for you. You just select the patient, the provider, and the service code. The software does the rest.

Plan Exceptions detail a unique combination of a specific insurance plan, service code, and type of provider. When you add a new charge entry to the daysheet, SOS takes the service code of the entry, the patient’s primary insurance plan, and the type of provider (if relevant) and checks to see if there is a match with a Plan Exception. If there is a match, the plan exception is used to determine:

  • How fee responsibility should be split between insurance and patient’s responsible payers.
  • If any part of the fee should be immediately adjusted (written off).
  • The CPT (and optionally any modifier) codes that should be used for claim filing.
  • (Pro version only) The revenue code to use on Institutional Claims.

You don’t have to fill in every field, just those that differ from the defaults on the General tab. For example, if only the CPT code to be used on claims for this payer is different from that specified in the Service properties (Common Lookups > Services), that is all you have to enter in the Plan Exception.

Copay (patient responsibility) calculation

Although increasingly uncommon, some managed care insurance coverage still employs more complex rules than those in our example above, such as escalating co-pay amounts based on the number of previous treatment visits. If that is the case for a particular Carrier Plan Exception, you should select “Authorization settings” for the Calculate Copay From field and make sure that the relevant Authorization configuration is defined appropriately in the patient’s Insurance Policy.


Non-standard units

You can override the number of units entered on the Charge Entry form through the use of the Multiply units by value in the Plan Exception. Rarely there may be a situation in which a particular payer requires that services be reported in the claim based on a smaller time increment. For example, one payer might require you to report a treatment hour in 15-minute units, while most payers expect a “1” for the hour. In this situation you could set a units multiplier of “4” in the Plan Exception for this service/carrier plan combination. The units on your charge entry will show “1” in the Charge Entry in SOS, but come out as “4” on the claim for this payer.

Special CPT requirements

Let’s say that one of your Carrier Plans requires a different CPT code than the rest of your payers for the same service. You would then add a Plan Exception for that Plan and service shorthand code, specifying the required CPT code. Some SOS users instinctively think that they need to add a new service entry to the Services list just for Medicare patients. Not only is an alternate Service not necessary, but it would also cause problems when a patient’s primary insurance requires one CPT while the secondary insurance requires a different CPT. Use a single service entry and shorthand code for each service. Just add or adjust the appropriate Plan Exception when a special need arises.

UB Revenue Code

If you are using the Pro version of the software and file institutional claims (UB forms and/or electronic institutional claims), you also can specify a special Revenue Code when billing the service and payor designated for the current exception.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

This site uses Akismet to reduce spam. Learn how your comment data is processed.