# Glossary of Terms

Contents

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  [A](#a)   [B](#b)   [C](#c)   [D](#d)   [E](#e)   [F](#f)   [G](#g)   [H](#h)   [I](#i)   [J](#j)   K         [L](#l)   [M](#m)

  [N](#n)   [O](#o)   [P](#p)   [Q](#q)   [R](#r)   [S](#s)   [T](#t)   [U](#u)   [V](#v)   [W](#w)   [X](#x)   Y         Z
  --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------

## A

#### Abuse

A range of improper compliance behaviors or billing practices, which
include some of the following examples:

-   Billing for a non-covered service

-   Misusing codes on the claim (i.e., the way the service is coded on
    the claim does not comply with national or local coding guidelines
    or is not billed as rendered)

-   Inappropriately allocating costs on a cost report

-   Under-, over-coding

#### Absence Over Leave (AOL)

A patient who is granted leave from the hospital but fails to return at
the expiration of the leave.

#### Absent Without Leave (AWOL)

A patient who leaves the hospital without giving notice of his/her
intent to leave.

#### Accountable Health Plan (AHP)

A Preferred Provider Organization (PPO) plan that serves self-funded
employers. It has a strong partnership between employers and
participating health care providers, including hospitals, physicians,
and an extensive network of ancillary medical providers. Usually the
participating companies own the PPO network. There is no insurance
company to retain any portion of the savings.

#### Accreditation

An evaluative process in which a healthcare organization undergoes an
examination of its policies, procedures, and performance by an external
organization (\"accrediting body\") to ensure that the healthcare
organization is meeting predetermined criteria. It usually involves both
on- and off-site surveys.

#### Actual Charge

The amount of money a doctor or supplier charges for a certain medical
service or supply. This amount is often more than the amount Medicare
approves.

#### Adjusted Average Per Capita Cost (AAPCC)

An estimate of how much Medicare will spend in a year for an average
beneficiary.

#### Adjustment

For an appeal: an additional payment made on the original settlement on
a claim.

For adjustments related to deductibles, coinsurance, copays, and other:
the account could be adjusted to a zero balance or close to zero, based
on the documents received from the payers.

#### Administrative Code Sets

Code sets that characterize a general business situation rather than a
medical condition or service. Under HIPAA these are sometimes referred
to as non-clinical or non-medical code sets.

#### Administrative Cost

A general term that refers to Medicare and Medicaid administrative
costs, as well as CMS administrative costs. Medicare administrative
costs are comprised of the Medicare related outlays and non-CMS
administrative outlays. Medicaid administrative costs refer to the
Federal share of a state's expenditures for administration of the
Medicaid program. CMS administrative costs are the costs of operating
CMS (e.g., salaries and expenses, facilities, equipment, rent and
utilities, etc.). These costs are reflected in the Program Management
account.

#### Administrative Law Judge (ALJ)

A hearings officer who presides over appeal conflicts between providers
of services or beneficiaries, and Medicare contractors.

#### Admitting Physician

The doctor responsible for admitting a patient to a hospital or other
inpatient health facility.

#### Adopted Person

A person who has been permanently placed for adoption with a substitute
parent(s) pursuant to tribal or state law.

#### Advanced Beneficiary Notice (ABN)

A written notification (per HCFA) that must be signed prior to rendering
a service to a Medicare beneficiary that could potentially be
denied/deemed "not medically necessary". When an ABN is on file, a GA
modifier (HCPCS modifier) must be appended to the service in question on
the HCFA 1500 form. Once a Medicare beneficiary signs the ABN, they are
lawfully liable for the charges if Medicare denies payment for the
service as "not medically necessary."

#### Against Medical Advice (AMA)

A patient who leaves the hospital against medical advice and may be at
risk for adverse health outcomes and potential readmission.

#### Allowed Charge

Individual charge determined by a carrier for a covered SMI medical
service or supply.

#### Ambulatory Care

Medical services provided on an outpatient (non-hospitalized) basis.
Different payment methodologies apply to hospital outpatient versus
free‑standing facilities.

#### Ambulatory Patient Classifications (APC)

A structure for classifying outpatient services and procedures for
purposes of payment.

#### Ambulatory Surgery

Same-day outpatient surgery: admitted to same-day surgery unit, treated,
and discharged in the same day

#### American Dental Association (ADA)

A professional organization for dentists. The ADA maintains a hardcopy
dental claim form and the associated claim submission specifications,
and also maintains the Current Dental Terminology (CDT) medical code
set. The ADA and the Dental Content Committee (DeCC), which it hosts,
have formal consultative roles under HIPAA.

#### American Medical Association (AMA)

A professional organization for physicians. The AMA is the secretariat
of the NUCC, which has a formal consultative role under HIPAA. The AMA
also maintains the Current Procedural Terminology (CPT) medical code
set.

#### American National Standards Institute (ANSI)

An organization that accredits various standards-setting committees, and
monitors their compliance with the open rule-making process that they
must follow to qualify for ANSI accreditation. HIPAA prescribes that the
standards mandated under this organization be developed by
ANSI-accredited bodies whenever practical.

#### Appeal

An appeal is a special kind of complaint you make, if you disagree with
a decision to deny a request for health care services or payment for
services you already received. You may also make a complaint if you
disagree with a decision to stop services that you are receiving. For
example, you may ask for an appeal if Medicare does not pay for an item
or service you think you should be able to get.

#### Appeal Process

The process used if you disagree with any decision about your health
care services. If Medicare does not pay for an item or service you have
been given, or if you are not given an item or service you think you
should get, you can have the initial Medicare decision reviewed again.
If you are in the Original Medicare Plan, your appeal rights are on the
back of the Explanation of Medicare Benefits (EOMB) or Medicare Summary
Notice (MSN) that is mailed to you from a company that handles bills for
Medicare. If you are in a Medicare managed care plan, you can file an
appeal if your plan will not pay for or does not allow or stops a
service that you think should be covered or provided.

#### Approved Amount

The fee insurers set as reasonable for a covered medical service. This
is the amount a doctor or supplier is paid by for a service or supply.
It may be less than the actual amount charged by a doctor or supplier.
The approved amount is sometimes called the \"Approved Charge."

#### Assigned

Where the provider agrees to accept the Medicare approved amount for
each service as payment in full.

#### Assignment of Benefits

Authorization given by the patient to the facility which allows the
facility to receive reimbursement from the carrier. The provider accepts
payment from Medicare as payment in full. If a provider accepts
assignment from a non-beneficiary, the deductible and coinsurance can be
billed to the patient.

#### Authorization

Under HIPAA, a covered entity may use or disclose protected health
information (PHI) pursuant to written Authorization (IHS - 810 form) or
valid written request from the individual.

#### Authorized

Any properly designated person, including the parent of a child (under
18 years), the legal guardian, lawyer, and/or parent who has legal
custody, who files a request or an appeal on behalf of the person.

#### Automated Claim Review

Claim review and determination made using system logic (edits).
Automated claim reviews never require the intervention of a human to
make a claim determination.

## B

#### Balance Bill

The bill sent to the patient for the amount in excess of the fee
approved and paid by the insurance.

#### Base Roll

The specified allotment, annuity, census, or other roll upon which
membership in a federally recognized Indian tribe is based, as
designated by a Federal statute, by the Secretary, or by the tribe's
written governing document, such as constitution, enrollment ordinance,
or resolution; also the Alaska Native claims Settlement Act roll
established pursuant to 43 U.S.C. 1604.

#### Benchmarking

Finding best-class examples of a product, service, or operational
system, and adjusting the existing product, service, or operational
system to meet or exceed those standards.

#### Beneficiary

A person who is eligible for or receiving benefits under an insurance
policy or plan.

-   An IHS beneficiary is an American Indian or Alaskan Native enrolled
    or descended from a federally recognized tribe

#### Benefits

The medical services for which an insurance plan will pay, in full or in
part.

#### Benefit Period

The way that Medicare measures use of hospital and skilled nursing
facility (SNF) services. A benefit period begins the day you go to a
hospital or skilled nursing facility. The benefit period ends when you
have not received any hospital care (or skilled care in a SNF) for 60
consecutive days. If you go into the hospital or a skilled nursing
facility after one benefit period has ended, a new benefit period begins
if you are in the Original Medicare Plan. You must pay the inpatient
hospital deductible for each benefit period. There is no limit to the
number of benefit periods you can have.

Within an IHS facility, benefit days are exempt. Benefit days are
counted only in a non-IHS facility.

#### Birthday Rule

Determines who will be the primary policyholder for billing purposes,
when both parents/spouses work and each subscribes to a health insurance
policy provided through their employer. The subscriber or policyholder
whose birthday is earlier in the year, is traditionally assigned to be
the primary insurance holder and all claims are first sent for
processing to the medical insurance company subscribed to by that parent
or spouse.

#### Bonus Payment

An additional payment paid by Medicare for services provided by
providers in Health Professional Shortage Areas.

#### Bundled

A bundled service is a service or procedure that is not separately
billed to the insurer or patient. Reimbursement is considered to be a
part of the other services performed.

#### Business Associate

A person or organization that performs a function or activity on behalf
of a covered entity, but is not part of the covered entity's workforce.

## C

#### Capitation

A fixed, agreed upon rate paid monthly per patient enrolled under the
provider/facility, to cover services; also based on a Per Member, Per
Month (PMPM) payment.

#### Care Plan

A written plan for a patient's care, specifying what services the
patient will need to keep his/her best physical, mental, and social
well-being; also called a **Treatment Plan**.

#### Carrier

The company contracted with the Federal government to handle the
Medicare/Medicaid program for a particular state. For example,
TrailBlazer Health Enterprises, LLC is the current carrier for handling
the Medicare Part B program.

#### Case Management

A process used by a doctor, nurse, or other health professional to
manage a patient's health care needs.

#### Case Manager

A nurse, doctor, or social worker who arranges all services that are
needed to give proper health care to a patient or group of patients.

#### Catastrophic Illness

A very serious and costly health problem that could be life-threatening
or cause life-long disability. The cost of medical services alone for
this type of serious condition could cause financial hardship.

#### Census

The number of patients that are occupying inpatient beds on a daily
basis.

#### Centers for Medicare and Medicaid (CMS)

The HHS agency responsible for rules and regulations and payment for
Medicare and parts of Medicaid (formerly HCFA).

Historically, CMS has maintained the UB-92 institutional EMC format
specifications, the professional EMC NSF specifications, and
specifications for various certifications and authorizations used by the
Medicare and Medicaid programs. CMS is responsible for oversight of
HIPAA administrative simplification transaction and code sets, health
identifiers, and security standards. CMS also maintains the HCPCS
medical code set and the Medicare Remittance Advice Remark Codes
administrative code set.

#### Certified (Certification)

This means a hospital has passed a survey done by a State government
agency. Being certified is not the same as being accredited. Medicare
only covers care in hospitals that are certified or accredited.

#### Certified Nursing Assistant (CNA)

Provides non-medical assistance to patients, such as help with bathing,
dressing, and using the bathroom. CNAs are trained and certified to help
nurses.

#### Certified Registered Nurse Anesthetist (CRNA)

A Nurse who is trained and licensed to give anesthesia.

#### Charge Ticket

A multi-part form which provides sufficient information to capture all
services related to the encounter and used as a tool for data entry;
also referred to as a **Superbill**.

#### Civil Monetary Penalties (CMP)

The term used for the fines attached to fraudulent claims.

#### Claim

A notice to the insurance company that a person received care covered by
the plan. In the current RPMS billing system, a claim, once approved,
becomes a bill, and is a request for payment.

#### Claim Adjustment Reason Code

A national administrative code set that identifies the reasons for any
differences, or adjustments, between the original provider charge for a
claim or service and the payer\'s payment for it. This code set is used
in the X12 835 Claim Payment & Remittance Advice and the X12 837 Claim
transactions, and is maintained by the Health Care Code Maintenance
Committee.

#### Claim Attachment

Any of a variety of hardcopy forms or electronic records needed to
process a claim in addition to the claim itself.

#### Claims Processors

The individuals responsible for processing claims in the insurance
company; also know as Claims Representatives or Claims Examiners

#### Claim Status Codes

A national administrative code set that identifies the status of health
care claims. This code set is used in the X12N 277 Claim Status Inquiry
and Response transaction, and is maintained by the Health Care Code
Maintenance Committee.

#### Clinic

A facility often associated with a hospital that is devoted to the
diagnosis and care of outpatients.

#### Clinical Laboratory Improvement Act (CLIA)

Sets standards to be met by all clinical laboratories, regardless of
location, size, or type of laboratory. CLIA is the accrediting body for
the lab. CMS requires adherence to the four levels of testing.

#### CMS -- 1450

The uniform institutional claim form, or UB92.

#### CMS -- 1500

The uniform professional claim form, or HCFA 1500

#### Code of Federal Regulations

The official compilation of federal rules and requirements.

#### Code Set

Under HIPAA, any set of codes used to encode data elements, such as
tables of terms, medical concepts, medical diagnostic codes, or medical
procedure codes; includes both the codes and their descriptions.

#### Coding

The process of selecting codes which properly identify and define
medical services, procedures, and diagnosis.

#### Co-insurance

The portion of the balance of covered medical expenses which a
beneficiary must pay after the deductible.

#### Consultation

When a physician responds to a request from another provider to perform
a medical evaluation, opinion, and plan of treatment.

#### Commissioned Corp

A specialized Public Health Service (PHS) career system designed to
attract, develop, and retain health professionals, who may be assigned
to Federal, State or local agencies or international organizations to
accomplish its mission. The agencies/programs are designed to

-   Help provide healthcare and related services to medically
    underserved populations: to Americans, American Indians and Alaska
    Natives, and to other population groups with special needs.

-   Prevent and control disease, identify health hazards in the
    environment and help correct them, and promote healthy lifestyles
    for the nation\'s citizens.

-   Improve the nation\'s mental health.

-   Ensure that drugs and medical devices are safe and effective, food
    is safe and wholesome, cosmetics are harmless, and electronic
    products do not expose users to dangerous amounts of radiation.

-   Conduct and support biomedical, behavioral, and health services
    research and communicate research results to health professionals
    and the public.

-   Work with other nations and international agencies on global health
    problems and their solutions.

#### Commissioned Officer

An officer of the Commissioned Corp of Public Health Service

#### Common Working File (CWF)

A CMS data reporting system which combines Part A and B files into a
common file. The CWF reorganizes certain claims processing functions to
simplify and improve overall Medicare claims processing by creating
localized databases containing total beneficiary histories.

#### Comprehensive Outpatient Rehabilitation Facility (CORF)

A facility that provides a variety of services including physicians\'
services, physical therapy, social or psychological services, and
outpatient rehabilitation.

#### Conditional Payment

A payment made by Medicare for services which another payer is
responsible.

#### Consent

The process of obtaining a signature from a patient that allows the
facility to perform a procedure.

#### Continuous Quality Improvement (CQI)

A process which continually monitors program performance. When a quality
problem is identified, CQI develops a revised approach to that problem
and monitors implementation and success of the revised approach. The
process includes involvement at all stages by all organizations affected
by the problem and/or involved in implementing the revised approach.

#### Contract Health Services (CHS)

Contract health referrals are provided principally for members of
federally recognized AI/AN who reside on or near reservations
established for the tribes in geographic areas. CHS funds are provided
to non-IHS facilities and providers when

1\) the direct care element is incapable of providing care,\
2) no IHS direct-care facility exists,\
3) the direct care element has overflowed, or\
4) to supplement alternate resources.

The staff determines patient eligibility, processes procurement orders,
tracks allocations to ensure program stays within budget, and
coordinates activities associated with CHS.

#### Coordinated Coverage

Integrating benefits payable under more than one health insurance (for
example, Medicare and Medicaid). Typically, coordinated coverage is
arranged so that the insured benefits from all sources not exceeding 100
percent of allowable medical expenses. Coordinated coverage may require
beneficiaries to pay some deductible or co-insurance.

#### Coordination of Benefits

A provision that applies when a person is covered under more than one
group medical program.

#### Co-Payment

Type of cost sharing that the insured party is responsible for payment
of a fixed dollar amount

#### Cost Report

The financial report from hospital providers documenting hospital costs
according to Medicare Cost Principles. This report is used for
calculating inpatient and outpatient payment rates.

#### Covered Entity

Under HIPAA, this is a health plan, a health care clearinghouse, or a
health care provider who transmits any health information in electronic
form in connection with a HIPAA transaction.

Examples of Individuals: physicians, nurses, dentists, chiropractors,
physical therapists, or pharmacists.

Examples of organizations: hospitals, home health agencies, clinics,
nursing homes, residential treatment centers, laboratories, pharmacies,
ambulance companies, group practices, health maintenance organizations,
suppliers of durable medical equipment.

#### Critical Access Hospital

A small facility, certified by Medicare, that gives limited outpatient
and inpatient hospital services to people in rural areas.

#### Critical Care

Care rendered to a patient in a state of crisis.

#### Cross-Over

Process where Medicare forwards claim and payment information to a
participating secondary payer.

#### Cross-walking

A cross reference between two or more coding systems. It can also be
used for laboratory tests and associated fee schedules.

#### Current Dental Terminology (CDT)

The coding used by dental offices to submit and process dental claims.
CDT includes a complete listing and detailed description of codes for
every dental, evaluation, and orthodontic procedure.

#### Current Procedural Terminology (CPT)

A medical code set of physician and other services, maintained and
copyrighted by the American Medical Association (AMA), and adopted by
the Secretary of HHS as the standard for reporting physician and other
services on standard transactions.

#### Customary Charge

One of the factors determining a physician's payment for a service under
Medicare.

## D

#### Data Condition

A description of the circumstances under which certain data is required.

#### Data Content

Under HIPAA, all of the data elements and code sets inherent to a
transaction, and not related to the format of the transaction.

#### Data Dictionary

A document or system that characterizes the data content of a system.

#### Data Element

Under HIPAA, the smallest named unit of information in the transaction.

#### Data Mapping

The process of matching one set of data elements or individual code
values to their closest equivalents in different set of data elements.
This is sometimes called a cross-walk.

#### Deductible

A portion of the covered expense that an insured individual must pay
before insurance coverage with co-insurance goes into effect.
Deductibles are standard in many policies and are usually based on a
calendar year.

#### Dependents

The spouse and children of the insured/Commissioned Officer as defined
by an insurance contract.

#### Designated Standard

A standard which HHS has designated for use under the authority provided
by HIPAA.

#### Determination

A decision made to either pay in full or in part, or to deny a claim.

#### Diagnosis Related Groups (DRGs)

The hospital classification and reimbursement system that groups
patients by diagnosis, surgical procedures, age, sex, and presence of
complications. This is a financial mechanism used to reimburse hospitals
and selected other providers for services rendered.

#### Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition (DSM IV)

The American Psychological Association publishes its own manual to
classify mental disorders and addictions in greater clinical detail than
what is provided (or intended) in ICD-9-CM.

#### Digital Signatures

Electronic signatures. There are two types of electronic signatures:
1) digitized, and 2) digital.

Digitized signatures are scanned images of an individual's actual
handwritten signature, transmitted as part of the file transfer. The
authentication or verification of this type of electronic signature
requires sophisticated software or human intervention.

Digital signatures are numeric values created by performing a
cryptographic transformation (called a "hash") of the data, using the
"signer's" private key, essentially reversing the roles of the public
and private keys. If you transmit data encrypted using your private key
and the receiver successfully decrypts the file using your public key,
it must have come from you.

To assure the integrity of the file transfer, a one-way hashing
algorithm is also created which can be thought of as a fingerprint on
the data. If even one bit is changed between the submitter and the
receiver, the receiver of the file will be notified when the file is
decrypted that the data has been compromised.

#### Direct Data Entry

Under HIPAA, the direct entry of data that is immediately transmitted to
a health plan\'s computer.

#### Discharge Planner

A person responsible for planning and implementing a systematic process
and method for releasing a patient from a facility. This process
includes (but not limited to) assuring the provider has documented the
record, patient medications are released, the patient has been educated,
and coordination with outside agencies for continued care, follow-up.

#### Disclosure

Release or divulgence of information by an entity to persons or
organizations outside of that entity.

#### Down-Coding

Changing a code to a lesser code.

#### Downloading

The transfer of data or program from a server or host computer to one's
own computer or device.

#### Dual Eligibles

Persons who are entitled to Medicare (Part A and/or Part B) and who are
also eligible for Medicaid.

#### Durable Medical Equipment (DME)

Medical equipment which can withstand repeated use; is not disposable;
is used to serve a medical purpose; is generally not useful to a person
in the absence of sickness or injury, and is appropriate for use in the
home. Examples include hospital beds, wheelchairs, and oxygen

#### Durable Medical Equipment Regional Carrier (DMERC)

Contracted regional carriers that process DME claims for Medicare.

## E

#### Edit

Logic within the Standard Claims Processing System (or PSC Supplemental
Edit Software) that selects certain claims, evaluates or compares
information on the selected claims or other accessible source, and
depending on the evaluation, takes action on the claims, such as pay in
full, pay in part, or suspend for manual review

#### Editing

When a coder reviews a medical record or electronic health record
compared to the coding provided by the provider, the coder will compare
the code to the verbiage and secondarily will recommend to the provider
modifications, and adaptable or suitable changes to better align the
documentation with coding. These changes, once approved by the provider,
will be updated or changed in the RPMS system.

#### Electronic Data Interchange (EDI)

Claims that are electronically filed with Medicare. The exchange of
business transaction files from one computer to another in standard
format using standard communication protocols.

#### Electronic Fund Transfer

A financial transaction established with the bank to transfer funds
electronically from the payer to the provider.

#### Electronic Media Claims

A flat file format used to transport claims, such as the 192-byte UB-92
institutional FMC format and the 320-byte professional EMC NSF.

#### Electronic Remittance Advice

Any of several electronic formats for explaining the payments of health
care claims.

#### Eligibility

Meeting the legal requirements for health benefits. It is still
necessary to file an application to become entitled.

#### Employee

An individual who is working for an employer or an individual who,
although not actually working for an employer, is receiving from an
employer payments that are subject to FICA taxes or would be subject to
FICA taxes except that the employer is exempt from those taxes under the
Internal Revenue Code.

#### Employer

The entity that hires individuals (employees) to work for them.
Employers include organizations engaged in a trade or business, other
entities exempt from income tax such as religious, charitable, and
educational institutions.

#### Employer Group Health Plan or Employer Plan

Any health plan that is of, or contributed to by, an employer, and that
provides medical care, directly or through other methods such as
insurance or reimbursement to current or former employees and/or their
families.

#### Employer Identification Number (EIN)

An Employer Identification Number (EIN) is also known as a Federal Tax
Identification Number, and is used to identify a business entity.

#### Encounter Form

The form used to record all services and diagnoses applicable to an
individual patient encounter; synonymous with PCC visit form. Often a
provider will list frequently performed services and associated
diagnoses on this form. When filled out and signed by the provider, the
information on this form is not to be independently changed by the
coder.

#### Encryption

The translation of data into a secret code. There are two types of
encryption: 1) private (symmetric) key, and 2) public (asymmetric) key.

Private key encryption, generally, is considered faster, uses the same
key to both encrypt and decrypt EDI transmissions. This requires both
trading partners to know the private key, thus requiring a separate
private key for each trading partner.

Public key encryption uses a pair of keys to encrypt and decrypt data: a
public key that can be distributed freely to all trading partners and a
private key known only to the owner of the key pair. One key cannot be
mathematically calculated based on the other. Data encrypted with one
key may only be decrypted using the other key in the pair.

#### Episode of Care

Health care services given during a certain period of time, usually
during a hospital stay.

#### Established patient

As defined by the AMA, an established patient is someone who has
received a service by a given provider within the last three (3) years.

#### Exclusive Provider Organization (EPO)

Similar to an HMO, except that it is regulated by an insurance company
and generally pays physicians and other health care providers
differently.

#### Explanation of Benefit (EOB)

The coverage statement sent to covered persons listing services
rendered, amount billed and payment made. Normally, this includes any
amounts due from the patient.

## F

#### Facility Fee

Charging a cost for use of the facility in which the service was
rendered.

-   The facility fee applies when the service is performed in a hospital
    (inpatient, outpatient, and emergency room), ambulatory surgical
    center, and skilled nursing facility settings.

-   The facility fee does not apply when the service is performed in a
    physician's office or any other place of service other than those
    listed. IHS Free standing facilities fall into this classification.

#### Federally Qualified Health Center (FQHC)

A facility located in a medically underserved area that provides primary
medical care under general supervision of a physician to the community.
The facility has to apply for this status through HRSA.

#### Fee For Services (FFS)

A plan for providing services to enrollees solely through
fee-for-service payments by line item.

#### Fee Schedule

A list of all the services typically rendered by a provider in their
daily practice. The gold standard is that each CPT/revenue/HCPCS/dental
code is assigned one fee. The fee schedules are determined by your
region by geographic area.

#### Fiduciary

A person in a position of trust with regard to the affairs of another
who has a duty to act for the benefit of the other, with respect to a
particular undertaking.

#### Fiscal Intermediary (FI)

A private contractor that administers claims for Medicare Part A, some
of Part B bills, and in some cases, Medicaid; also referred to as
"intermediary."

#### Follow-up Days (FUD)

The global surgical package rules from AMA state that for a period of
time postoperatively the visits for follow-up care rendered during a
normal surgical recovery are included in the fee for the surgical
service. Small procedures often have FUD between 10-15 days. Major
surgeries have FUD established between 60-90 days; however, each
third-party medical insurance plan can set their criteria for FUD. CMS
publishes their follow-up days as part of the annual physician fee
schedule.

#### Formulary

A list of certain drugs and their proper dosages. For some insurers,
doctors must order or use only drugs listed on the insurer\'s formulary.

#### Fraud

The listing services for reimbursement that were not actually performed,
documented or medical necessary. There are two types of fraud, civil and
criminal, per the Federal False Claims Act. Examples are:

-   Billing for services not furnished or supplies not provided. This
    includes billing Medicare for appointments that patients failed to
    keep.

-   Altering claim forms and/or receipts to receive a higher payment
    amount.

-   Duplicate billing that includes billing the Medicare program and the
    beneficiary, Medicaid, or some other insurer in an effort to receive
    payment greater than allowed.

#### Free Standing (Ambulatory Care)

Medical services provided as outpatient but not connected to a hospital.

#### Freedom of Information Act (FOIA)

A provision that any person has a right, enforceable in court, of access
of federal agency records, except to the extent that such records, or
portions thereof, are protected from disclosure by one of nine
exemptions or by one of three special law enforcement record exclusions.

## G

#### Generic Drug

A prescription drug that has the same active-ingredient formula as a
brand name drug. Generic drugs usually cost less than brand name drugs
and are rated by the Food and Drug Administration (FDA) to be as safe
and effective as brand name drugs.

#### Geographic Practice Cost Index (GPCI)

A measure of the differences in resource costs among physician fee
schedule areas. There are three GPCIs, one for each relative value unit
(RVU) component: 1) a work GPCI, 2) an overhead GPCI and 3) a
malpractice GPCI.

#### Global Service

Pertains to the complete cost of a procedure (100 percent), which
includes the technical and professional components.

#### Global Surgery Policy

Preoperative examination, surgery, and postoperative care are included
in the global surgery rate. An exception to this policy is if an
unrelated complication occurred and additional surgery was needed. The
services related to the complication can be billed independently.

#### Government Performance Results Act (GPRA) Taxonomy Codes

The GPRA taxonomy system allows the creation of diagnosis taxonomies
(groups of ICD-9 diagnosis codes) for a particular disease. A disease
may have many ICD-9 codes associated with it. Therefore, this grouping
or taxonomy provides a listing of all related diagnosis codes to this
disease. Each time a purpose of visit is entered through the PCC data
entry process, the system will automatically update the list of patients
who fall into this taxonomy.

#### Grandfathering

An alteration of the rules that apply to certain benefits, policies, or
regulations, in that the "old rules, policies or regulations" remain in
effect even though new policies have been enacted.

#### Group Health Insurance Plan

A plan purchased for individuals by an employer or leader of a group.
This plan is written for any group of participants (such as employees or
a group or professionals) and eligible dependents under a single policy
issued to the employer or group leader. Individual certificates are
issued to the individuals and dependents with equal coverage for each
person in the plan.

#### Group Health Plan

Any arrangement of, or contributed to by, one or more employers or
employee organizations to provide health benefits or medical care
directly or indirectly to current or former employees, the employer,
others associated or formerly associated with the employer in a business
relationship, or their families.

#### Grouper

Computer software that translates variables such as age, diagnosis, and
surgical codes into the diagnosis related group (DRG) and APC under
which Medicare payment amount is determined. (e.g., 3M, QuadraMed)

#### Grouper Allowance

The pricing software that determines payments based on the revenue and
others codes listed on the CMS 1450 form.

#### Guarantor

A person, by agreement with another person (typically the patient), who
assumes the responsibility of assuring payment or fulfillment of other
person's debts or obligations.

## H

#### HCFA 1500 Form

*See* **CMS -- 1500**.

#### Health Care Clearing House

A public or private entity that processes or facilitates the processing
of information received from another entity (such as a provider, clinic
or facility) in a nonstandard format or containing nonstandard data
content into standard data elements or a standard transaction that can
be accepted by the insurer for processing a claim. In addition, the
clearing house acts as a monitor between the provider/facility and
insurance company, by reviewing each transaction, each claim, and
identifying any errors prior to it being submitted to the insurance
company.

#### Health Care Financing Administration (HCFA)

Now called Centers for Medicare and Medicaid (CMS), it is the Federal
government agency which regulates and controls the Medicare program
nationwide. *See also* **Centers for Medicare and Medicaid (CMS)**.

#### Health Care Provider

An individual or institution that provides medical services (e.g., a
physician, hospital, or laboratory). This term should not be confused
with an insurance company that "provides" health insurance.

#### Health Care Provider Taxonomy Codes

An administrative code set that classifies health care providers by type
and area of specialization. The code set will be used in certain adopted
transactions.

#### Health Insurance Claim (HIC)

A 9-digit number with an alpha or alpha-numeric suffix or prefix that is
assigned to each beneficiary when he/she becomes eligible for Medicare
or Railroad Retirement. This number is always needed to identify the
beneficiary when processing his/her claims.

#### Health Insurance Portability and Accountability Act (HIPAA)

Federal legislation that mandates easier portability of medical
information by standardizing electronic transaction and code sets, and
enacting additional patient privacy provisions.

#### Health Level Seven (HL7)

An ANSI-accredited group that defines standards for the cross-platform
exchange of information within a health care organization. HL7 is
responsible for specifying the Level Seven OSI standards for the health
industry. The X12 275 transaction will probably incorporate the HL7 CRU
message to transmit claim attachments as part of a future HIPAA claim
attachments standard.

#### Health Maintenance Organization (HMO)

An entity that provides, offers, or arranges for coverage of designated
health services needed by plan members for a fixed, prepaid premium. The
HMO contracts with health care professionals and facilities to provide
the specified care. Generally, a patient cannot seek care outside of the
health care providers and/or hospitals under contract with the HMO.

#### Health Professional Shortage Area (HPSA)

Any of the following, which the Secretary determines has a shortage of
health professionals (primary medical care, dental, or mental health
providers):

-   An urban or rural area, which need not conform to the geographic
    boundaries of a political subdivision and which is a rational area
    for the delivery of health services

-   A population group

-   A public or nonprofit private medical facility

The Public Health Service (PHS) classifies counties as primary care
shortage areas, if they have more than 3,000 persons per physician (3.3
physicians per 10,000 persons). The PHS has four levels of priority; the
highest priority is to have counties with no more than two primary care
physicians per 10,000 persons.

#### Health Plan

An entity that pays for medical treatments through their employer

#### Healthcare Common Procedure Coding System (HCPCS)

The coding system used by Medicare to indicate exactly what medical,
dental, supply, and pharmacy services were provided. HCPCS codes consist
of CPT codes, as well as national and local codes.

#### Hearing

A procedure that gives a dissatisfied claimant an opportunity to present
reasons for the dissatisfaction and to receive a new determination based
on the record developed at the hearing.

#### History of Present Illness (HPI)

A description of the patient's illness in a chronological order from
onset of first symptoms until the present.

#### Home Health Care

Persons who assist ill, elderly or disabled persons in the home carrying
out care as needed and to teach family the care so that the patient can
remain in his/her home.

#### Hospice

A special way of caring for people who are terminally ill, and for their
family. This care includes physical care and counseling. Hospice care is
covered under Medicare Part A (Hospital Insurance).

#### Hospital

An institution that provides inpatient or outpatient medical, surgical,
or psychiatric care and treatment for the sick or the injured.

#### Hospital Discharge

On the patient's last day as an inpatient, the physician has to write
orders for discharge care, prescriptions, and coordination with outside
agencies for follow-up. In addition to this, the provider traditionally
spends time instructing the patient and the caregiver. When all is done,
the provider must dictate a lengthy synopsis of the course of
hospitalization, outcome, and discharge plans. This service is
time-based.

## I

#### "Incident-To"

A Health Care Financing Administration (HCFA) rule regarding the coding
for services rendered by office staff employed by the physician, as
though the physician performed the services him or herself. The rule
only applies to place of service being the physician's office (Place of
Service Code - 22). The major requirement is that the provider must be
in the office suite and readily available. Another major rule is that
the physician must have seen the patient first and established a plan of
treatment. The modifier for "incident to" is YR.

#### Independent Practice Association (IPA)

This association provides both insurance coverage and medical services.
Physicians practicing in their own offices participate in the prepaid
health care plan, charge patients agreed upon rates, and bill the IPA on
a fee-for-service.

#### Indian

Any person of American Indian or Alaska Native blood who is a member of
those tribes listed or eligible to be listed in the Federal Register
pursuant to 25 U.S.C. 479a-1(a); or any descendant of such person who
was residing within its boundaries of any Indian reservation on June 1,
1934; or any person not a member of one of the listed or eligible to be
listed tribes who possess at least one-half degree of Indian blood. For
purpose of these regulations, Alaskan Natives and other aboriginal
peoples of Alaska shall be considered Indians.

#### Indian Blood Quantum

The amount of American Indian or Alaska native blood of a Federally
recognized Indian tribe

#### Indian Tribe

An American Indian or Alaska Native tribe, band, nation, pueblo,
village, or community which appears on the list of recognized tribes
published in the Federal Register by the Secretary (25 U.S.C.
479a-1(a)).

#### Individual Health Insurance Plan

A plan purchased directly by the individual receiving the benefits. The
policy is issued to the individual and/or eligible dependents. Usually,
an individual plan will have higher premiums with fewer benefits, as
compared with the same type of group plan.

#### Industry Standard

Something, such as a practice or product, which is widely recognized or
employed because of its excellence.

#### Initial (Claim) Determination

The first adjudication made by a carrier or fiscal intermediary (FI)
(i.e., the affiliated contractor) following a request for Medicare
payment; or the first determination made by a PRO, either in a
prepayment or postpayment context.

#### Inpatient

A patient who is admitted to a hospital for treatment that requires at
least one overnight stay.

#### Internal Control Number (ICN)

Internal Control numbers (referenced through Trailblazers) are assigned
to each claim in the following manner;

  ----------- ----------- ------------- ----------- ----------- -----------
  22          01          076           245         09          0

  Region      Year        Julian Date   Batch No.   Claim No.   Split No.
  ----------- ----------- ------------- ----------- ----------- -----------

#### International Classification of Diseases, 9th Edition, Clinical Modification (ICD-9-CM)

A listing of diagnosis and identifying codes used by physicians and
hospitals for reporting diagnoses and procedures of health plan
enrollees. The World Health Organization classifies all diseases,
defects, syndromes, external causes of injury, chemical imbalances,
genetic illnesses, and administrative reasons for an encounter with a
health care entity, known at the time of publication. Each year new
diseases and syndromes are discovered and added to the classification
schema, which is submitted to the National Center for Health Statistics
(NCHS). NCHS adds the CM (clinical modification) to ICD‑9-CM.

## J

#### J-Codes

A subset of the HCPCS Level II code set with a high-order value of "J"
that is used to identify certain drugs and other items.

#### Joint Commission on Accreditation of Healthcare Organizations (JCAHO)

An organization that accredits healthcare organizations. The JCAHO also
plays a role in certifying these organizations\' compliance with the
HIPAA requirements.

#### Julian Date

A continuous count of days, beginning January 1 (001) and ending
December 31 (365, 366 leap year). For example, The Julian date for
February 18 is 049.

## L

#### Liability Insurance

Insurance that protects against claims for negligence or inappropriate
action or inaction, which results in injury to someone or damage to
property.

#### Limited Coverage

Coverage of certain procedures is limited by the diagnosis. If the
diagnosis listed on the claim is not the same as one of those listed as
covered for the procedure, the procedure is denied.

#### Limiting Charge

A non-participating physician is entitled by Medicare to 95% of the fee
schedule amount of which Medicare will pay 80% of this amount. As for
the remainder of the bill, non-participating providers are allowed to
bill a total of 15% above the reduced fee schedule (reduced fee schedule
equating to the 95% of the fee schedule) to the beneficiary. Any
physician (participating or non-participating) who charges a beneficiary
more than the limiting charge must refund the difference. *See also*
**Non-par**.

#### Local Codes

A generic term for code values that are defined for a State or other
local division or for a specific payer. Commonly used to describe HCPCS
Level III Codes.

#### Local Coverage Determination (LCD)

An LCD, as established by Section 522 of the Benefits Improvement and
Protection Act, is a decision by a fiscal intermediary or carrier
whether to cover a particular service on an intermediary-wide or
carrier-wide basis in accordance with Section 1862(a)(1)(A) of the
Social Security Act (i.e., a determination as to whether the service is
reasonable and necessary).

The difference between a Local Medical Review Policy (LMRP) and an LCD
is that an LCD consists only of "reasonable and necessary" information,
while an LMRP may also contain category or statutory provisions.

The final rule establishing LCDs was published November 11, 2003.
Effective December 7, 2003, CMS contractors began issuing LCDs instead
of LMRPs. Over the next 2 years (until December 31, 2005) contractors
were to convert all existing LMRPs into LCDs and articles. Until the
conversion is complete, for purposes of a 522 challenge, the term LCD
will refer to both 1) Reasonable and necessary provisions of an LMRP
and, 2) an LCD that contains only reasonable and necessary language.

#### Local Medical Review Policy (LMRP)

An administrative and educational tool to assist providers, physicians,
and suppliers in submitting correct claims for payment. Local policies
outline how contractors will review claims to ensure that they meet
Medicare coverage requirements. CMS requires that an LMRP be consistent
with national guidance (although it can be more detailed or specific),
developed with scientific evidence and clinical practice, and is
developed through certain specified federal guidelines.

Contractor Medical Directors develop LMRPs. Reviewing Local Medical
Review Policies assists in understanding why Medicare claims may be paid
or denied.

#### Locality

A geographic area for which a carrier calculates prevailing charges. A
locality can include states, aggregation of counties, parts of counties,
and metropolitan zip code areas.

#### Long Term Care

Health care for patients with chronic disability or who suffer from
chronic disease, that requires assistance with routine activities of
daily living.

#### Long Term Disability Insurance

A provision to pay benefits to recovering disabled persons as long as
he/she remain disabled up to a specified period.

## M

#### Managed Care

Any system of health service payment or delivery arrangements where the
health plan attempts to control or coordinate use of health services by
its enrolled members in order to contain health expenditures, improve
quality, or both. Arrangements often involve a defined delivery system
of providers with some form of contractual arrangement with the plan.

From the provisions of the Balanced Budget Act of 1997, States can amend
their state plans to require categories of Medicaid beneficiaries to
enroll in managed care entities without obtaining waivers. Through the
Managed Care Organization (MCO), the states are paid a fixed prospective
monthly payment for each beneficiary enrolled with the entity for health
care. Enrolled beneficiaries are required to receive health care
services provided under the MCO's contract, through the MCO that
receives the capitated payment.

Managed care plans can serve Medicare beneficiaries through three types
of contracts:1) risk, 2) cost, and 3) health care prepayment plans
(HCPPs). All plans receive a monthly payment from the Medicare program.

HCFA/CMS launched the "Medicare Choices" demonstration project to allow
beneficiaries to join a wider variety of managed care plans and to
extend managed care options to rural areas

#### Mandatory Services

Services that each State Medicaid program is required to cover,
including hospital, physician, and skilled nursing facility services.

#### Maximum Defined Data Set

Under HIPAA, this is all of the required data elements for a particular
standard, based on a specific implementation specification. An entity
creating a transaction is free to include whatever data any receiver
might want or need. The recipient is free to ignore any portion of the
data that is not needed to conduct their part of the associated business
transaction, unless the inessential data is needed for coordination of
benefits.

#### Medicaid

A program of Federal matching grants to the states to provide health
insurance for the poor and medically indigent. States share in financing
the program and eligibility and benefits consistent with Federal
standards

#### Medical Code Sets

Codes that characterize a medical condition or treatment. These code
sets are usually maintained by professional societies and public health
organizations.

#### Medical Decision Making

The process of formulating a diagnosis and treatment plan is referred to
as medical decision making. Medical decision making is measured by
taking into account three separate parameters: 1) the number of
potential diagnoses and treatment options; 2) the amount and complexity
of medical data to review; and 3) the potential risk for complications,
death, and disability.

#### Medical Necessity

Whenever a service is rendered to a patient by a provider, those
services should be necessary to affect a cure or a change in the
condition for which the patient is being seen. The medical record should
have supporting documentation that the services ordered, rendered,
and/or billed were necessary, based on current standards of medical
care.

#### Medical Record

The chronological documentation of pertinent facts, findings, and
observations about an individual's health history, including past and
present illnesses, examinations, tests, treatments, and outcomes.

#### Medical Review 

A contractor review of Medicare claims to ensure that the service was
necessary and appropriate; also referred to as Utilization Review.

#### Medicare

A Federal health insurance program for people 65 years or over, disabled
persons, and patients with chronic renal disorders.

#### Medicare Benefit Notice

A notice sent to a patient after his/her doctor files a claim for Part A
services in the original Medicare Plan. It says what the provider billed
for, the Medicare-approved amount, how much Medicare paid, and what the
patient must pay. Also, for Part B services, the beneficiary may obtain
either an Explanation of Medicare Benefits or a Medicare Summary Notice.

#### Medicare Contractor 

A Medicare Part A Fiscal Intermediary (institutional), a Medicare Part B
Carrier (professional), or a Medical Durable Medical Equipment Regional
Carrier (DMERC).

#### Medicare Coverage Advisory Committee (MCAC)

MCAC advises CMS on whether specific medical items and services are
reasonable and necessary under Medicare law. They perform this task via
a careful review and discussion of specific clinical and scientific
issues in an open and public forum. The MCAC is advisory in nature, with
the final decision on all issues resting with CMS. Accordingly, the
advice rendered by the MCAC is most useful when it results from a
process of full scientific inquiry and thoughtful discussion, in an open
forum, with careful framing of recommendations, and clear identification
of the basis of those recommendations.

The MCAC is used to supplement CMS's internal expertise and to ensure an
unbiased and contemporary consideration of "state of the art" technology
and science. Accordingly, MCAC members are valued for their background,
education, and expertise in a wide variety of scientific, clinical, and
other related fields. In composing the MCAC, CMS was diligent in
pursuing ethnic, gender, geographic, and other diverse views, and to
carefully screen each member to determine potential conflicts of
interest.

#### Medicare Part A

The Medicare hospital insurance program which covers the cost of
hospital and post hospital services and is available without payment of
a premium.

#### Medicare Part B

The Medicare supplementary medical insurance program covers the cost of
physician services, outpatient lab and x-ray services, DME, outpatient
hospital care, and certain other services. Part B requires payment of a
monthly premium.

#### Medicare Part D

The prescription drug benefit program offered by CMS to individuals
covered by Medicare Part A or B. This program is voluntary, has
associated premiums and co-payments, and is effective January 1, 2006.
Coverage is obtained through prescription drug plans (PDPs) that are
available in each region.

#### Medicare Secondary Payer

A statutory requirement that private insurers providing general health
insurance overage to Medicare beneficiaries pay beneficiary claims as
primary payers.

#### Medigap Insurance

Purchased by Medicare enrollees to cover co-payments, deductibles, and
healthcare goods or services not paid for by Medicare; also known as
Medicare supplements policy. It is a health insurance policy or other
health benefit plan offered by private entities to those persons
entitled to Medicare benefits and is specially designed to supplement
Medicare benefits, filling in some of the "gaps" in Medicare coverage by
providing payment for some of the charges for which Medicare does not
have responsibility due to applicability of deductible coinsurance
amounts, or other limitations imposed by Medicare.

#### Modifier

Two-character code use in conjunction with a procedure code to modify
payment or help describe the procedure performed.

## N

#### National Committee for Quality Assurance (NCQA)

This committee is a private, not-for-profit organization which serves as
a watchdog for the preservation of health care quality in the realm of
managed care.

#### National Council For Prescription Drug Programs (NCPDP)

An ANSI-accredited group that maintains a number of standard formats for
use by the retail pharmacy industry, some of which have been adopted as
HIPAA standards.

#### National Correct Coding Initiative (NCCI)

A CMS database of CPT coding relationships. The database identifies CPT
services that are considered inherently included (bundled) in other
services. The database also identifies fragmentation or unbundling of
services that could be captured with a single CPT code. When one
procedure is included in another procedure, it should not be billed
separately. The NCCI database triggers the claims adjudication system to
throw out one of the bundled codes as denied services.

#### National Coverage Policy

A policy developed by CMS that indicates whether and under what
circumstances certain services are covered under the Medicare program.
It is published in CMS regulations, published in the Federal Register as
a final notice, contained in a CMS ruling, or issued as a program
instruction.

#### National Drug Code (NDC)

A medical code set maintained by the Food and Drug Administration that
contains codes for drugs that are FDA-approved. The Secretary of HHS
adopted this code set as the standard for reporting drugs and biologics
on standard transactions.

#### National Plan & Provider Enumeration System (NPPES)

Developed by the Centers for Medicare & Medicaid Services (CMS) in
response to the Administrative Simplification provisions of HIPAA,
mandating the adoption of standard unique identifiers for health care
providers and for health plans, this system assigns these unique
identifiers.

#### National Provider Identifier (NPI)

A unique identification number for health care providers that will be
used with all administrative and financial transactions specified by
HIPAA. The Administrative Simplification provisions of HIPAA mandated
the adoption of a standard unique identifier for health care providers.
The National Plan and Provider Enumeration System (NPPES) collects
identifying information on health care providers and assigns each
provider a unique NPI.

#### Nature of Presenting Problem

A "disease, condition, illness, injury, symptom, sign, finding,
complaint, or other reason for an encounter, with or without a diagnosis
being established at the time of the encounter"; also called chief
complaint.

#### New Patient

Per the AMA, a patient that has not been seen by a physician (in a
single provider practice) for the past 36 months (three years).

#### No-Fault Insurance

No-fault insurance is insurance that pays for health care services
resulting from injury to you or damage to your property regardless of
who is at fault for causing the accident.

#### Non-Assigned

The beneficiary receives payment since the assignment of benefits was
not checked by the patient. For non-beneficiary patients, the total
charge is charged to the patient.

#### Non Beneficiary

This can be defined in two ways:

1\) A person who is not eligible for receiving benefits under an
insurance policy or plan.

2\) A person who is not an American Indian or Alaskan Native enrolled or
descended from a Federally recognized tribe.

#### Non-Covered Services

Services for which there is no coverage or benefit permitted. Services
deemed non-covered will not be paid by a third party health insurance.
An example is cosmetic surgery. Non-covered services are usually the
fiscal responsibility of the patient.

#### Non-par or Non-Participating Provider

A provider who elects not to participate with a given health care plan
for a third party payer. In some instances, the provider can still bill
the patient for the difference between the allowed amount and their fee
for the service provided. *See also* **Limiting Charge**.

#### Nonpayment

Act of failing to meet a financial obligation or act of failing to pay
money.

#### Notice of Privacy Practices (NPP)

This notice describes how the medical information about the patient may
be used and disclosed by the facility or clinic and how the patient can
get access to their medical information.

#### Nurse Practitioner (NP)

A nurse who has two or more years of advanced training and has passed a
special exam. A nurse practitioner often works with a doctor and can do
some of the same things a doctor does.

## O

#### Observation Bed

The use of a bed and periodic monitoring by a hospital's nursing or
other ancillary staff which is reasonable and necessary to evaluate an
outpatient's condition to determine the need for possible inpatient
admission.

#### Off Site Visits

Visits provided usually by Home Health staff to the person's home,
hospice or another location, other than the clinic.

#### Office for Civil Rights (OCR)

Part of HHS, the HIPAA responsibilities of OCR include oversight of the
privacy requirements.

#### Outpatient

A patient who receives treatment in a hospital or clinic but does not
require an overnight stay.

#### Over-coding

The practice of coding and billing for a service that is worth more when
a lesser service has actually been provided and documented; also called
**Up‑coding**. Over-coding is considered fraud.

#### Overpayment Assessment

A decision that an incorrect amount of money has been paid for Medicare
services and a determination of what that amount is.

## P

#### Participating Provider (PAR)

A provider who is contracted with a third party payer to participate
with the policies, procedures, and fees for a health plan.

#### Pass-through Payment

Payments to hospitals for costs that are excluded from the Prospective
Payment System (PPS), including bad debt, kidney acquisition costs, and
direct costs of medical education.

#### Past History

The review and documentation of a patient's history with health care
prior to the present encounter. This includes taking a history of prior
illnesses, injuries, surgeries, hospital stays, current medications,
food and drug allergies, age appropriate immunization history, and age
appropriate feeding or dietary practices.

#### Patient

A person who is receiving medical treatment in a hospital or clinic; a
person who is registered with a doctor, dentist, or other health
professional, and is treated by her/him when necessary.

#### Payment Floor and Ceiling

The Medicare statute provides for claims payment floors and ceilings,
where

-   A floor is the minimum amount of time a claim must be held before
    payment.

-   A ceiling is the maximum time allowed for processing a clean claim
    before Medicare owes interest to a provider.

These payment floors and ceilings apply to all payments except "periodic
interim payments."

On average the manual paper claim processes averages around 30 days and
the electronic billing process averages less than 10 days.

#### Payment in Full

The amount that the provider is obligated to accept (contractually or
voluntarily) as payment in full from the insurer, in full satisfaction
of the patient obligation.

#### Peer Review Organization (PRO)

An organization contracting with CMS to review the medical necessity and
quality of care provided to Medicare beneficiaries; currently known as
**Quality Improvement Organization** (QIO)

#### Penalty

A decreased percentage of payment or non-payment for non-compliance of
Medicare reporting requirements.

#### Per Diem

Method of reimbursement based on a flat rate for each day of care.

#### Performance Measures

A specific measure of how well a health plan or facility does in
providing health services to its enrolled population, which can be used
as a measure of quality; also known as Metrics.

#### Physician Assistant (PA)

A person who has two or more years of advanced training and has passed a
special exam. A physician assistant works with a doctor and is qualified
to perform certain functions a doctor does without oversight.

#### Physician Extenders

Health care providers such as nurse practitioners, physician's
assistants, and clinical nurse specialists; also referred to as Midlevel
Providers.

In 1997, the Balanced Budget Act gave these providers the right to have
their own billing numbers. Previously, for billing purposes, they were
held to the "incident to" guidelines, which mandated billing their
services under the physician's ID number. Once a physician extender has
his/her own ID or billing number, he/she can practice and bill
independently as dictated by state practice laws, and generally, are
paid by CMS at 85 percent of the rate that physicians are paid.

#### Physician Hospital Organization (PHO)

An organization formed to permit a hospital and members of its medical
staff to enter into joint managed care contracts. PHOs vary in terms of
structure, governance, credentialing, administration, and managed care
contracting.

#### Place of Service (POS)

The location where a health care service is rendered. CMS assigns
two-digit indicators to those places where a medical service or
procedure can be provided. The place where a service is rendered can
determine the reimbursement and coding conventions applied to the
service codes. If services are rendered in two locations in a given day,
such as the clinic and the emergency room, the reimbursement is reduced
for the services provided or split into technical and professional
components. For the latter, usually two separate bills are provided by
the facility.

#### Point of Service Plan

A type of managed care plan that is a hybrid of HMO and PPO plans. Like
an HMO, participants designate an in-network physician to be their
primary care physician, but like a PPO, patients may go outside of the
provider network for health care services. When patients venture outside
of the network, they will have to pay most of the cost, unless the
primary provider has made a referral to the out-of-network provider.

#### Policy Holder

The individual holding health insurance benefits.

#### Pre-Authorization

An insurance plan requirement in which the insured or the insured's
primary care physician needs to notify the insurance company in advance
about certain medical procedures (e.g., outpatient surgery) in order for
those procedures to be considered a covered expense; also known as
**prior authorization**. If the authorization is approved, an
authorization number is issued.

Generally, this is different from a referral in that, an authorization
can be a verbal or written approval from the insurance plan, whereas a
referral is a written document that must be received by a doctor prior
to rendering any health care service.

#### Pre-Certification

The process of obtaining permission from the insurance carrier prior to
the service being performed.

#### Pre-existing Condition

Pre-existing condition is a health problem the patient had before the
date that a new insurance policy started.

#### Predetermination

The process of obtaining an estimate of what an insurance carrier will
pay for the service before that service is performed.

#### Preferred Provider Organization (PPO)

This is a network comprised of physicians and other health care
providers that agree to provide services at discounted rates, and/or
pursuant to certain utilization protocols to people enrolled in health
coverage offered by a health coverage provider.

#### Premium

An amount paid monthly or periodically to purchase medical insurance.

#### Prepaid Health Plan

A program of health care where services are rendered by participating
physicians to an enrolled group of individuals. Usually fixed payments
are made in advance periodically by, or on behalf of, each person. A
typical example of this type of plan is a Health Maintenance
Organization (HMO).

#### Prepayment Edits

Many third party payers have electronic edits built into the claims
adjudication system. When a claim comes into the payer billing system
electronically, the payer's system targets specific CPT codes,
modifiers, and verifies the relationship to ICD-9-CM codes. The
non-compatible codes are denied before the claims are processed.

#### Pricer or Repricer

A person, an organization, or a software package that reviews
procedures, diagnoses, fee schedules, and other data, and determines the
eligible amount for a given health care service or supply. Additional
criteria can then be applied to determine the actual allowance or
payment amount.

#### Primary Care

A basic level of care usually given by doctors who work with general and
family medicine, internal medicine (internists), pregnant women
(obstetricians), and children (pediatricians). A nurse practitioner
(NP), a State licensed registered nurse with special training, can also
provide this basic level of health care.

#### Primary Care Physician (PCP)

A physician, the majority of whose practice is devoted to internal
medicine, family/general practice, and pediatrics. An
obstetrician/gynecologist sometimes is considered a primary care
physician, depending on coverage. The PCP can also be the provider
assigned to the patient to manage his/her care.

#### Prior Authorization

*See* **Pre-Authorization**.

#### Professional Component

The professional component encompasses all of the physician's work in
providing the service, including the interpretation and report of the
procedure.

#### Proposed Audit

Pertains to auditing patient records against proposed billing
information. In this case, the audit is conducted on encounters that
have not yet been billed. This is the recommended methodology.

#### Prospective Payment System (PPS)

The Medicare system that pays hospitals for hospital services under DRG
methodology.

#### Provider

The entity, such as a physician, hospital, or paraprofessional, who
provides covered services and supplies to the beneficiary.

#### Provider Identification Number (PIN)

An identification code assigned to a provider by Medicare, Medicaid, and
private insurance, to obtain reimbursement from the insurers for
services rendered by the provider.

## Q

#### Qualified Medicaid Beneficiary (QMB)

A Medicaid program for beneficiaries who need help in paying for
Medicare services. The beneficiary must have Medicare Part A and limited
income and resources. For those who qualify, the Medicaid program pays
Medicare Part A premiums, Part B premiums, and Medicare deductibles and
coinsurance amounts for Medicare services.

#### Quality Assurance

The process of looking at how well a medical service is provided. The
process may include formally reviewing health care given to a person or
group of persons, locating the problem, correcting the problem, and then
checking to see if what solution worked.

#### Quality Improvement Organization (QIO)

Groups of practicing doctors and other health care experts, who are paid
by the Federal government to check and improve the care given to
Medicare patients. They must review complaints about the quality of care
given by: inpatient hospitals, hospital outpatient departments, hospital
emergency rooms, skilled nursing facilities, home health agencies,
private Fee-for Service plans, and ambulatory surgical centers. Formerly
called **Peer Review Organization** **(PRO)**.

## R

#### Railroad Retirement

A federal insurance program similar to Social Security designed for
workers in the railroad industry. The provisions of the Railroad
Retirement Act provide a system of coordination and financial
interchange between the Railroad Retirement program and the Social
Security program.

#### Reasonable Charge

Usual and customary.

#### Referral

Approval or consent by a primary care physician for a patient referral
to ancillary services and specialists. Also refers to a contract health
service referral.

#### Reject Status

Encounter data that did not pass the "front end" edit process.

#### Remittance Advice

The notice sent to the provider explaining how the claim was processed
and what payment amount is being made, what applied to the deductible,
what services were denied and why.

#### Remittance Advice Remark Codes

A national administrative code set for providing either claim-level or
service-level Medicare-related messages that cannot be expressed with a
Claim Adjustment Reason Code. This code set is used in the X12 835 Claim
Payment & Remittance Advice transactions.

#### Relative Value Study (RVS)

A guide or methodology for establishing the relationship between
resources, time, expertise, competency, liability, and other pertinent
factors, which contribute to the performance of medical and surgical
procedures.

#### Relative Value Unit (RVU)

An RVU is defined as the unit of value associated with the components of
a specific medical or surgical service or procedure. It is based either
on historical charges for the procedure or the resources required to
perform the service.

#### Release of Information (ROI)

Patient signature indicating consent for release of information
necessary for settlement of his/her insurance claim. This can also be
defined as releasing a copy of the medical record to another provider or
facility for continuing care.

#### Reopening

An action taken after all appeal rights have been exhausted to
re-examine or question the correctness of a determination, a decision,
or a cost report as final.

#### Resource Based Relative Value Study (RBRVS)

Due to mandates from Congress in the Social Security Act, HCFA was
challenged to develop a fee schedule for physicians using a relative
value scale. Prior to the development of RBRVS, the payments made by
HCFA for physician services were based on historical payment data.

RBRVS was used to break physician services into three components:
1) work, 2) overhead, and 3) malpractice. The three values are added
together and adjusted using the Geographic Practice Cost Indices (GPCI)
assigned by the local carrier for the geographic location where the
services are rendered. Factoring GPCI's into the fee schedule makes
payment equitable and relative to the geographic area where the services
are rendered. The final outcome is multiplied by a national conversion
factor (CF) to arrive at the amount that HCFA, now CMS, will pay for
each service under the fee schedule.

#### Resource Patient Management System (RPMS)

RPMS is an integrated software solution of over 50 software applications
(also called packages or modules), providing comprehensive management of
clinical, financial, and administrative information that is used at most
health care facilities within the Indian health care delivery system.

#### Retroactive Audit

Auditing paid claims by looking backward at provider documentation
against billing information and EOBs; also called **Post Payment
Audit**. Usually performed when looking to make corrections on problems
found in a prospective audit, *this is no longer the recommended
methodology.*

#### Return to Stock

Prescription drugs that have not been picked up by patients that are
returned to the inventory of the pharmacy.

#### Revenue Codes

Payment codes for services or items in FL 42 of the UB-92 form found in
Medicare and/or NUBC (National Uniform Billing Committee) manuals (42X,
43X, etc.)

#### Review

A re-evaluation of the claim and consideration of any new evidence
submitted. This review can be performed up to six (6) months after the
claim processed.

#### Review of Systems (ROS)

A review of the body systems to discover what (if any) additional body
systems or anatomical areas are affected by the presenting problem.
Patient systems as well as anatomical areas affected are included in
ROS.

#### Rural Health System

An outpatient facility that is primarily engaged in furnishing
physicians and other medical and health services, and that meets other
requirements designated to ensure the health and safety of individuals
served by the facility. The facility must be located in a medically
underserved area that is not urbanized and that has not been defined by
the U.S. Census.

## S

#### Sanctions

Administrative remedies and actions (e.g., exclusion, Civil Monetary
Penalties, etc.) available to the Office of Inspector General (OIG) to
deal with questionable, improper, or abusive behaviors of providers
under Medicare, Medicaid, or any State health programs. The facility can
not bill for any provider under a sanction.

#### School Visits

Visits conducted by the staff of a clinic to either provide
immunizations, educate the class on a particular medical topic, or for
other health-related reasons.

#### Second Opinion

When another doctor gives his or her view about a potential diagnosis
and how it should be treated.

#### Secondary Payer

An insurance policy, plan, or program that pays second on a claim for
medical care.

#### Self-employed

Earning one's livelihood directly from one's own trade or business
rather than as an employee of a trade or business.

#### Self Insured Plan

A plan under which an individual or private or governmental entity
carries its own risk instead of taking out insurance with its own
carrier.

#### Segment

A series of related data elements in electronic transactions.

#### Skilled Nursing Facility (SNF)

A facility, which meets specific regulatory certification requirements,
that primarily provides inpatient skilled nursing care and related
services to patients who require medical, nursing, or rehabilitative
services, but does not provide the level of care or treatment available
at the hospital.

#### Social Security Administration (SSA)

The Federal agency that, among other things, determines initial
entitlement to and eligibility for Medicare benefits.

#### Specified Low-Income Medicare Beneficiaries (SLMB)

Individuals entitled to Medicare Part A, who have income greater than
100% Federal Poverty Level (FPL) but less than 120% FPL, and resources
that do not exceed twice the SSI limit (\$4,000 for an individual, and
\$6,000 for a couple).

#### Split Billing

Billing that has been split between hospital and medical insurance, such
as the professional and technical component for radiology services.

#### Standard Claims Processing System

Certain computer systems currently used by carriers and Fiscal
Intermediaries (FIs) to process Medicare claims.

#### Standard Transaction

Under HIPAA, this is an electronic transaction that complies with moving
electronic data in a standard format. See also **transaction**.

#### State Children's Health Insurance Program (SCHIP)

Free or low-cost health insurance for uninsured children under age 19.
State Children's Health Insurance Programs help reach uninsured children
whose families earn too much to qualify for Medicaid, but not enough to
get private coverage.

#### Superbill

A multi-part form which provides sufficient information to capture all
services related to the encounter and used as a tool for data entry;
also referred to as a **Charge Ticket**.

#### Supplemental Insurance

Health insurance held by Medicare beneficiaries that covers part or all
the program's cost sharing requirements and some services not covered by
traditional Medicare. Beneficiaries may obtain these policies as a
retirement benefit from a former employer or individual purchase.

#### Supplemental Security Income (SSI)

The Federal subsistence income maintenance program for eligible disabled
the aged blind (Title XVI).

#### Supplier

Providers, other than practitioners of health care services, such as
independent labs, DME providers, ambulance services, and portable x-ray
providers.

#### Suspend

A claim that has been stopped at some point during claims processing,
due to certain reasons (edits/audits). When a claim does suspend,
trained personnel make a determination as to the proper payment of the
claim.

#### Swing Bed

A hospital bed that can be used when a patient no longer needs acute
care but still needs skilled nursing care and observation. This
classification must be approved by the State and CMS. In addition, the
facility must follow certain requirements.

## T

#### Taxonomy Codes

Taxonomy codes are "national" specialty codes used by providers to
indicate their specialty at the claim level. PPOs also use provider
specialties to group provider types and indicate correct specialty
designations on provider finders.

*See also* **Government Performance Results Act (GPRA) Taxonomy Codes**,
**Health Care Provider Taxonomy Codes**.

#### Technical Component

The provision of equipment, supplies, technical personnel, and costs
related to the performance of the procedure other than the professional
services. The majority of automated laboratory studies are considered
100 percent technical. The services rendered by the radiology
technicians are also considered technical.

#### Telemedicine

Professional services given to a patient through interactive
telecommunications systems by a practitioner at a distant site.

#### Third Party Administrator (TPA)

An administrative organization other than the insurance company or
health care provider that collects insurance premiums, pays claims, and
provides administrative services.

#### Third Party Payer

An entity, such as an insurance company, that has agreed via a contract
(the insurance policy) to pay for medical or dental care provided to the
patient. Third Party refers to the involvement of another entity besides
the two parties directly involved in medical or dental care (the patient
and the physician, dentist). Third-party payer is frequently used
interchangeably with the terms insurance company, insurer, or payer.

#### Tort

Damage, injury, or wrongful act done willfully, negligently, or in
circumstances involving strict liability, but not involving breach of
contract, for which a civil suit can be brought.

#### Tracer

An inquiry made to an insurance company to inquire about the status of a
claim.

#### Transaction

Under HIPAA, this is the exchange of information between two parties to
carry out financial or administrative activities related to health care.

Under accounting, it is any event or condition in the book of accounts
(chronological record of inventory and orders).

#### Transfer

Moving a patient from one place to another, one treating specialty to
another, one ward to another, or one bed to another. Usually within IHS,
this infers moving a patient from an IHS facility to a private community
hospital.

#### Treatment Authorization Request (TAR)

Medical form that must be completed by a provider for certain procedures
or services that require prior approval.

#### Treatment Plan

A written plan for a patient's care, specifying what services the
patient will need to keep his/her best physical, mental, and social well
being; also called a **Care Plan**.

#### Tribally Self Insured

Typically, a self-insurance plan that involves payment of funds by a
Tribe or Tribal organization into a liability pool. The Tribe or Tribal
organization bears all the financial risk for the occurrence of a
particular event, such as health care costs for tribal employees. When
the particular event occurs, payment is made from the liability pool or
from other tribal resources. By law, IHS can not bill a tribally self
insured plan.

## U

#### Unbundled Services

If a service is typically bundled as part of another service and is
billed independently, it is called fragmenting the service or
"unbundling". This type of over-coding is considered fraud.

#### Under-coding

Billing for a service that is less than what was actually rendered
and/or documented is considered under-coding. Many physicians see this
methodology as a safe practice for coding and billing their services.
This practice, according to the Office of the Inspector General, is
considered a prosecutable form of fraud, as it is thought to be an
incentive to patients to seek more frequent services.

#### Unique Physician Identification Number (UPIN)

UPIN is a nationally assigned identifier to report with services which
have been referred or ordered. This unique 6-character, alphanumeric
identification follows each individual physician wherever he/she goes.
It is also necessary to use the UPIN of the ordering or referring
physician when billing for certain services that requires this
identification.

#### Up-coding

The practice of coding and billing for a service that is worth more when
a lesser service has actually been provided and documented; also called
**Over-coding**. Up-coding is considered fraud.

#### Urban Health Center or Clinic

A clinic or health center located in an urban area whose primary intent
is to service the urban population residing in that urban community.

#### Usual, Customary and Reasonable (UCR)

The commonly charged or prevailing fees for health services within a
geographic area.

#### Utilization Review (UR)

Programs designed to reduce unnecessary medical services, both inpatient
and outpatient. Utilization reviews may be prospective, retrospective,
concurrent, or in relation to discharge planning.

## V

#### Validation

The process by which the integrity and correctness of data are
established. Validation processes can occur immediately after a data
item is collected or after a complete set of data is collected.

## W

#### Waiting Period

The time between enrolling with a Medigap insurance company or Medicare
health plan and when the coverage starts. A health condition (other than
a pregnancy) or medical problem that was diagnosed or treated during a
specified timeframe prior to enrollment in a new health plan may be
subject to a waiting period on the new insurance coverage. This waiting
period is usually for a specified timeframe after the new effective date
of coverage.

#### Waiver of Liability

The advanced written notice to the beneficiary that the physician,
provider, or supplier believes there is a likelihood that the
item/service may be denied as not medically necessary.

#### Well Child Checkup

A preventive care term, specifically for children, and includes regular
checkups and administration of vaccinations with the latter being billed
separately.

#### Working Aged

Those beneficiaries age 65 or over who have group health plan (GHP)
coverage because of their current employment or their spouse's current
employment. For the working aged, Medicare is secondary payer for claims
to the GHP. For the purposes of the MSP Working Aged provision, a GHP is
any health plan that is for, or contributed to by, an employer of 20 or
more employees that provides medical care, directly or through other
methods, such as insurance or reimbursement, to current or former
employees and their families.

#### Workman's Compensation or Workers' Compensation

Insurance that employers are required to have to cover employees who get
sick or injured on the job.

#### Workforce

Under HIPAA, this means employees, volunteers, trainees, and other
persons under the direct control of a covered entity, whether or not
they are paid by the covered entity.

## X

#### X-12

An ANSI-accredited group that defines EDI standards for many American
industries, including health care insurance. Most of the electronic
transaction standards mandated or proposed under HIPAA are X12
standards.