Revenue Cycle Management Handout

HMO versus PPO

Health Management Organization Preferred Provider Organization
Concerns
(HMO) (PPO)
Do I need to YES: With most HMO plans, all of your healthcare NO: A PPO plan does not require you to select a
designate my services will be coordinated between you and your PCP. You can receive care from any doctor you
Primary Care designated Primary Care Physician (PCP). choose, however you will save more money by
Physician (PCP)? choosing a doctor, specialist, or hospital that is
within your network.
Is a referral YES: As an example, with an HMO, if you have NO: PPO plans do not require you to get a referral
needed? severe allergies and need to see an allergist, you in order to see a specialist.
will first schedule a visit with your PCP. Your doctor
will then provide you with a referral for an in-network
specialist.
Will I still be able to NO: HMOs don’t offer coverage for care from an YES: With a PPO, you have the flexibility to visit
see my out-of- out-of-network physician, hospital, or facility except providers, hospitals and facilities outside of your
network doctor or in the case of a true medical emergency. network. Keep in mind that visiting an out-of-network
specialist and have provider includes a higher fee and a separate
my care covered? deductible.
Will I have to file a NO: Since HMOs only allow you to see in-network YES: In some cases with a PPO, you will have to
claim? providers, it’s likely you’ll never have to file a claim. pay a doctor for services directly and then file a
This is because your insurance company pays the claim to get reimbursed. This is most common when
provider directly. you seek a service from an out-of-network provider.
How much will it Lower Cost: HMO plans typically have lower Higher Cost: PPOs tend to have higher monthly
cost? monthly premiums and you can expect to pay less premiums in exchange for the flexibility to choose
for out-of-pocket medical services. Both plans work providers both in- and out-of-network and without a
on a combination of deductibles, cost-share, or referral. Out-of-pocket medical costs also run higher
coinsurance and co-pays to pay for services. with a PPO plan.

RCM Workflow
Visit PCP/
Patient Start
Hospital Normal processing Special processing

1 2 3 4 5 6 7
Patient Eligibility Data Referral and Coding and Charge Claim
Relations Check Entry Authorization Billing Posting Submission

Dexcom
8 9
Clearing House Payment
Checkpoint Finish
Posting

10 11 12 13
Denial Secondary Accounts Appeal
YES Management Filing Receivable Procedure

Insurer Approved?
14
NO
Patient
Finish
Billing
 Revenue Cycle Management Handout
How Does One Get a Dexcom CGM?
Patient contacts insurance
Start
to know if CGM is covered
Patient goes to doctor
to get a prescription
Doctor asks patient to monitor
blood glucose levels for a period
YES
Doctor
prescribes?
NO
Common Terminologies
Appeal process/procedure—the process of requesting a
reversal of the denial made by the insurance company in order
to get the amount from the claim
Authorization—a document signifying approval for an action
Cash/payment posting—the process of posting payments in
patients' accounts
Claims—forms submitted to insurance companies by providers
Clearing house checkpoint—the process of exchanging claim
information which results to approved or denied claims
Clearing house—part of electronic insurance automated
system
Coding—the process of entering information in a system
Coinsurance—percentage of cost paid after the deductible
Commercial insurance—refers to general insurance such as
for property and liability
Consumer insurance—refers to health and life insurance
Co-pay—a flat fee charged on routine medical services
Deductible—amount paid before insurance pays for medical
services
Denial management—the process of tracking denials,
resubmitting claims, and providing follow up
Denial—the act of the insurance company of refusing a claim
due to some reason
Electronic remittance advice (ERA)—document sent to health
care providers that provides information about claim payments,
denials, and explanations
Explanation of benefits (EOB)—document being sent to
patients that provides information about services rendered,
respective codes, and allowed, billed, and adjusted insurance
amounts
Health care provider—same as “providers”
NO
Covered?
YES
Patient gets the prescription
from doctor
Patient orders from the ‘pharmacy’
Finish
to get Dexcom CGM
Health maintenance organization (HMO)—refers to a medical
plan/insurance where a patient pays a fee and healthcare
services received is coordinated by a primary care physician
(PCP).
Insurers—the party that provides insurance
Medical billers—a team that coordinates billing and claims
Medical billing—the process of submitting and following up on
claims with health insurance companies in order to receive
payment for services/orders rendered or requested by a
healthcare provider
Out-of-pocket maximum—maximum amount an insured pays
for medical services for the plan year
Patient/balance billing—a practice where a health care
provider bills a patient for the difference between their charge
amount and any amounts paid by the patient’s insurer or
applied to a patient’s deductible, coinsurance, or copay
Preferred provider organization (PPO)—refers to another
medical plan/insurance where patient pays a higher fee
compared to HMO, but has flexibility over choice of physician.
Premium—amount that an insured pays
Providers—can refer to either clinics or physicians
Registration—filing patient information on a form
Reimbursement—return of the amount advanced by the
patient
Revenue cycle management (RCM)—the financial process
that healthcare-related companies use to track patient care
activities from registration and appointment scheduling to the
final payment of a balance
Secondary filing—re-submission of the claim and ensuring that
all procedures and requirements are followed and submitted