HP Provider Relations October 2011 Spend-down. Spend-downOctober 20112 Agenda –Objectives...

HP Provider RelationsOctober 2011

Spend-down

Spend-down October 20112

Agenda

– Objectives

– Spend-down Rule

– Spend-down Eligibility

– Eligibility Verification System

– Enhanced Spend-down Information

– Billing a Member

– Claims Processing

– Examples of Application of Spend-down

– Spend-down Quiz

– Helpful Tools

– Questions & Answers


Objectives

– To provide a thorough explanation of spend-down rules and eligibility

– To explain when it is appropriate to bill Medicaid members for spend-down

– To outline claims processing procedures related to spend-down


Spend-down Rule

405 IAC 1-1-3.1 – Providing services to members enrolled under the Medicaid spend-down provision

– Subsection (d) states:

• A provider may not refuse service to a Medicaid member pending verification that the monthly spend-down obligation has been satisfied

• A provider may not refuse service to a Medicaid member solely on the basis of the member’s spend-down status

DefineSpend-down Eligibility


Spend-down Eligibility

– 405 IAC 2-3-10 – Spend-down eligibility• Certain types of income are counted in

determining Medicaid eligibility

• Income greater than a certain threshold is considered "excess income” and is referred to as "spend-down obligation"

– Spend-down, therefore, is very similar to a "deductible"• The Medicaid member is liable for their initial

Medicaid expenses each month, up to their spend-down amount

• Spend-down amounts are deducted from the first claim(s) processed each month

Pharmacy providers that bill claims on a point of sale (POS) system receive immediate claim adjudication and may collect the amount of spend-down credit at the time of service


Spend-down Eligibility

Spend-down may be applied to members in the following aid categories:

– Traditional Medicaid fee-for service (FFS)

– MEDWORKS

– Home and Community-Based Services (HCBS) Waiver

Members assigned to Care Select or the risk-based managed care (RBMC) program are not assigned a spend-down


Eligibility Verification System

– Enhanced spend-down information became available on the Eligibility Verification System (EVS) beginning January 1, 2010

– Using EVS, providers can determine the amount of spend-down remaining to be met for a particular monthNote: The amount indicated may not be the actual spend-down amount credited to your

claim

– With the exception of pharmacy claims billed on a POS system, providers may not collect the spend-down amount at the time of service

– Reference the IHCP Provider Manual, Chapter 2, Section 4, for additional information

Spend-down information on EVS


Eligibility Verification SystemEnhanced spend-down information

LearnBilling a Member


Billing a Member

– Providers should always review the Remittance Advice (RA) to see if Adjustment Reason Code (ARC) 178 applies to any claims on the RA• The end of the RA lists the ARC codes that appear within that week’s RA. Review

the listing to verify if ARC code 178 is included.

– ARC 178 indicates there is a spend-down amount billable to at least one member on that week’s RA

– A provider may bill a member for the dollar amount identified beside ARC 178 on the RA statement

– This amount will also appear in the "Patient Responsibility" column on the RA


Billing a Member

– Once the claim has adjudicated, providers are responsible to bill the member for the spend-down amount credited on the claim

– The member is not obligated to pay the provider until the member receives the Medicaid Spend-down Summary Notice listing the amount applied to spend-down

• Notices are sent on the second business day following the end of the month

• The notices give a detailed itemization of how the spend-down was applied for that month, including provider name, amounts, and dates of service


Billing a Member

What if the member doesn’t pay their spend-down?

– Providers may discharge a member from their care if a member does not adhere to established payment arrangements of outstanding copayments or spend-down

– Providers cannot be more restrictive with spend-down members than with other patients


Error Codes 0387 and 0388

– Providers may have encountered claim denials due to explanation of benefits (EOB) codes 0387 or 0388 – This service is not payable. The recipient has not satisfied spend-down for the month.

– Providers should notify their field consultant when claims deny for these error codes.

Note: Claims adjudicate to a paid status when spend-down is credited on a claim. Spend-down-related claims should not adjudicate to a denied status.


Quiz

Q How can providers determine when a member has a spend-down?

Q Why can’t providers collect the spend-down at the time of service?

Q How is the provider informed that spend-down has been credited on claims?


Quiz Responses

Q How can providers determine when a member has a spend-down?

A Providers can verify a member’s eligibility using Web interChange, Automated Voice Response (AVR), Omni, or the Health Insurance Portability and Accountability Act (HIPAA) 277/278 transaction

Q Why can’t providers collect the spend-down at the time of service?

A The amount credited to spend-down is not known until the claim adjudicates

Q How is the provider informed that spend-down has been credited on claims?

A Providers should review the RA to determine if and how much has been credited to spend-down

ExplainClaims Processing


Claims Processing

– The first claim processed by the IHCP applies to spend-down, regardless of the date of service within the month

– The system uses the billed amount to credit spend-down• Therefore, providers should bill their usual and

customary charge

– Third Party Liability (TPL) amounts are deducted from billed amount prior to crediting spend-down

– State-mandated copayments for pharmacy and transportation claims credit spend-down first


Claims Processing

– Services that are not covered by the Medicaid program do not credit spend-down

– Exceptions:

• A service that is denied because the member exceeds a benefit limitation, which cannot be overridden with prior authorization (PA), may credit spend-down

• Denied services may be split between spend-down months

Denied services


Claims Processing

Date Billed: September 25, 2011

– $100.00 Spend-down Remaining for September

– $200.00 Spend-down Remaining for October

Benefit limit exhausted – Example 1

Billed Amount

Claim Status Audit Credit to Spend-down

$200.00 Denied 6122 –

Chiropractic Therapeutic Physical Medicine Treatments Limited to 50

$100.00 – September

$100.00 – October


Claims Processing

– When a claim is paid and credits the member’s spend-down, a provider-initiated void or replacement can cause an increase or decrease in spend-down amount owed to a provider for the claim

– In the event a refund is due to the member as a result of a voided claim, the member is notified in the Medicaid Spend-down Summary Notice• The member must have paid the provider to be eligible for a refund

– Voids and replacements adjust the spend-down credit immediately

Voids and replacements


Claims Processing

The Division of Family Resources may also credit spend-down for certain “non-claim” expenses, including:

–Medical expenses incurred by a recipient’s spouse or other person whose income is considered in determining eligibility

–Medical services provided by non-Medicaid providers

–Services rendered prior to eligibility


Claims Processing

Hierarchy of spend-down credits:

– Non-claim items entered by the DFR caseworker

– State-mandated transportation and pharmacy copayments

– Denied details, when permitted

– Paid details


Claims Processing

– Each month, HP performs a month-end balancing process that ensures all “non-claim” items entered by the DFR are credited first

– This process ensures that all spend-down items are applied in accordance with the established hierarchy

– HP may initiate claim adjustments as a result of month-end balancing• Claims adjusted by the month-end balancing process have an internal control

number (ICN) that begins with 64

– These adjusted claims result in additional reimbursement to the provider

Month-end balancing


Claims ProcessingExample 1 – Spend-down activity for September – $500

Order of Claims that Credit the

Spend-down

Date of Service

Provider Type

Amount Incurred

Method of Claim

Submission

Claim Processing

Date

Claim Status

Spend-down Balance for September

1 9/2/11 Pharmacy $50.00 (Includes Copay)

Point of Sale (POS)

9/2/11 Paid $0.00 $450.00

2 9/5/11 Physician $100.00 Web interChange

9/5/11 Paid $0.00 $350.00


Point Of Sale (POS)

9/8/11 Paid $0.00 $300.00

4 9/7/11 Non-Claim

$50.00 ICES (County Office)

$250.00

5 9/8/11 Outpatient Hospital

$300.00 837I (Electronic)

9/15/11 $250.00 Credit spend-down

Paid $0.00

$0.00 (Allowed amount is less)

6 9/2/11 Dental $100.00 Paper 9/20/11 Paid IHCP Allowed


Claims ProcessingExample 2 – Spend-down activity for October – $300


Spend-down

Date of Service

Provider Type Amount Incurred

Method of Claim

Submission

Claim Processing

Date

Claim Status

Spend-down

Balance for October


Point of Sale(10:00 a.m.)

10/2/11 Paid $0.00

$280.00

2 10/2/11 Physician $50.00 Web interChange (2:00 p.m.)

10/2/11 Paid $0.00

$230.00

3 10/8/11 Dental $100.00 Web interChange

10/8/11 Paid $0.00

$130.00

4 10/25/11 Physician Void of Claim #2 for $50.00

Web interChange

10/25/11 Void Entire Claim

$180.00

5 10/28/11 Dentist $100.00 Paper 10/15/11 Paid $0.00

$80.00

6 10/29/11 Transport $150.00 Paper 10/20/11 $80.00 Credit Spend-down

$0.00 (Allowed amount is less)


Claims ProcessingExample 3 – Spend-down activity for June – $400


Spend-down

Date of Service

Provider Type Amount Incurred

Method of Claim

Submission

Claim Processing

Date

Claim Status

Spend-down

Balance for June

1 6/2/11 Pharmacy $50.00(Includes Copay)

Point of Sale (POS)

6/2/11 Paid $0.00 $350.00

2 6/5/11 Physician $100.00 Web interChange

6/5/11 TPL paid $25.00Paid $0.00

$275.00

3 6/8/11 Pharmacy $50.00(Includes Copay)

Point Of Sale (POS)

6/8/11 Paid $0.00 $225.00

4 6/8/11 Outpatient Hospital

$200.00 837I (Electronic)

6/15/11 Paid $0.00 $25.00

5 6/2/11 Transport $100.00 Paper 6/20/11 $25.00 Credit $2.00 copay rolls forward)

$0.00(Allowed amount is less)


Spend-down Quiz (True or False)

Q A provider may refuse to provide service to a member if they verify eligibility and determine the member has a spend-down?

Q A provider may refuse to provide a service to a member who has a legitimate past-due balance for a spend-down, but refuses to pay it?

Q A provider may bill the member for spend-down as soon as they receive a Remittance Advice that includes ARC 178?

Q Spend-down is credited based on the provider’s usual and customary charge (UCC)?

Q Spend-down is credited to claims in date-of-service order?

Q The highest priority transaction to credit spend-down are “non-claim” items entered by the DFR?


Spend-down Quiz (True or False)

Q A provider may refuse to provide service to a member if they verify eligibility and determine the member has a spend-down? FALSE

Q A provider may refuse to provide a service to a member who has a legitimate past-due balance for a spend-down, but refuses to pay it? TRUE

Q A provider may bill the member for spend-down as soon as they receive a Remittance Advice that includes ARC 178? TRUE

Q Spend-down is credited based on the provider’s usual and customary charge (UCC)? TRUE (when the provider bills the UCC)

Q Spend-down is credited to claims in date-of-service order? FALSE

Q The highest priority transaction to credit spend-down are “non-claim” items entered by the DFR? TRUE

Find HelpResources Available


Helpful ToolsAvenues of resolution

– IHCP Provider Manual, Chapter 2, Section 4 (Web, CD, or paper), available at indianamedicaid.com

– Customer Assistance• Local (317) 655-3240

• All others 1-800-577-1278

– Written Correspondence• HP Provider Written CorrespondenceP. O. Box 7263Indianapolis, IN 46207-7263

– Provider field consultant

http://provider.indianamedicaid.com/provider-home.aspx

HP Provider Relations October 2011 Spend-down. Spend-downOctober 20112 Agenda –Objectives...

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