Operations Management

The Apply Mass Adjustment business process begins with the receipt or notification of retroactive modifications. These changes may consist of modified rates associated with Healthcare Common Procedure Coding System (HCPCS), Claim Payment/Advice Transaction (CPT), Revenue Codes, or program modifications/conversions that affect payment or reporting. This mass adjustment business process includes identifying the payment transactions such as claims or capitation payment by identifiers (e.g., claim/bill type, HCPCS, CPT, Revenue Code(s), or member identification) that the State Medicaid Agency (SMA) paid incorrectly during a specified date range. The business process applies a predetermined set or sets of parameters that may reverse or amend the paid or denied transactions and repay correctly. NOTE: Do not confuse this process with the claim adjustment within the adjudication process. A mass adjustment may involve many previous payments based on a specific date or date range affecting single or multiple providers, members, or other payees. Likewise, mass adjustments historically refer to large-scale modifications in payments as opposed to disenrollment of a group of members from a Managed Care Organization (MCO).

A person that is not eligible for medical coverage when they have income above the health plan standards may become eligible for coverage through a process called spend-down (see Determine Member Eligibility business process). The Calculate Spend-Down Amount business process is responsible for tracking spend-down amounts and determining if a member meets its responsibility through the submission of medical claims. The Process Claim business process automatically accounts for the spend-down amount during adjudication. Once the member has met the spend-down obligation, a modification of eligibility status allows Medicaid payments to begin and/or resume. This typically occurs in situations where a member has a chronic condition and is consistently above the resource levels, but it may also occur in other situations. The Calculate Spend-Down Amount business process begins with the receipt of member’s health plan information from Enroll Member business process that requires a predetermined amount the member will be financially responsible for prior to Medicaid payment for any medical services.

The Process Claim business process receives original or adjusted claim (e.g., institutional, professional, dental, pharmacy, and waiver) information via web or Electronic Data Interchange (EDI) transaction, assigns an internal control number, and • Determines its submission status, and based on that: - Performs Claims Edits: ✓ Edit a single transaction for valid syntax and format, identifiers and codes, dates, and other information required for the transaction. ✓ Validate business edits, service coverage, Third-Party Liability (TPL), and reference coding. - Performs Claims Audits: ✓ Verify against historical information. ✓ Verify that services requiring authorization have approval, clinical appropriateness, and payment integrity. - Suspends claim that fail edits or audits for return to the provider for corrections, additional information, or internal review according to state defined business rules. - Applies National Correct Coding Initiative (NCCI) Edits. - Applies Diagnosis Related Group (DRG)/Ambulatory Payment Classification (APC), as appropriate. - Prices Claims: ✓ Calculate state allowed amount. ✓ Calculate paid amount. NOTE: All fee-for-services claim types will go through most of the business process steps but with different business rules associated with the different claim types. Both Centers for Medicaid & Medicaid Services (CMS) and state policy determine business rules for claims edits, audits, and pricing methodologies. State business rules define whether the State Medicaid Agency (SMA) pays, suspends, flags for information, or denies a claim. State business rules define whether an edit is fatal or non-fatal as well. See Constraints. NOTE: submitted processed claim in order to reverse the original claim payment and associate the original and replacement claim in the payment information. NOTE: This business process is part of a suite including Calculate Spend-down Amount, Submit Electronic Attachment, and Generate Remittance Advice business processes.

The Process Encounter business process receives original or adjusted encounter (e.g., institutional, professional, dental, pharmacy, and waiver) information via web or Electronic Data Interchange (EDI) transaction and determines its submission status, and based on that: • Performs Encounter Edits: - Edit a single transaction for valid syntax and format, identifiers and codes, dates, and other information required for the transaction. - Validate business edits, service coverage, Third-Party Liability (TPL), and reference coding. • Performs Encounter Audits: - Verify against historical information. - Verify that services requiring authorization have approval, clinical appropriateness, and payment integrity. • Suspends encounter that fail edits or audits for return to the provider for corrections, additional information, or internal review according to state defined business rules. - Apply National Correct Coding Initiative (NCCI) Edits. - Apply Diagnosis Related Group (DRG)/Ambulatory Payment Classification (APC), as appropriate. - Prices Encounters: ✓ Calculate state allowed amount. ✓ Calculate paid amount. ✓ Set paid amount to zero dollars. NOTE: All encounters will go through most of the business process steps but with different business rules associated with the different encounter claim types. Both Centers for Medicare & Medicaid Services (CMS) and state policy determine business rules for encounter edits, audits, and pricing methodologies. State business rules define whether an encounter goes to a to-be-paid status, suspends, flags for information, or denies. State business rules define whether an edit is fatal or non-fatal as well. See Constraints. NOTE: An adjustment to an encounter is on an exception use case to this business process that follows the same process path except it requires a link to the previously submitted processed encounter in order to reverse the original encounter and associate the original and replacement encounter in the calculation information. NOTE: This business process is part of a suite including Calculate Spend-down Amount, Submit Electronic Attachment, and Generate Financial Report business processes.

The Submit Electronic Attachment business process begins with receiving attachment information that either a payer requests (solicited) or a provider submits (unsolicited). The solicited attachment information can be in response to requests for more information from the following business processes for example: Process Claim, Process Encounter, Authorize Service, Authorize Treatment Plan, and Manage Estate Recovery. The business process links attachment information to the associated applicable transaction (e.g., claim, prior authorization, treatment plan) or suspends for a predetermined time set by state specific business rules, after which the business process purges information. The business process validates the successfully associated attachment information using application-level edits, determining whether the information provides the additional information necessary to adjudicate (i.e., approve, suspend or deny) the transaction.

The Generate Remittance Advice business process describes the activity of preparing remittance advice/encounter Electronic Data Interchange (EDI) transactions that providers use to reconcile their accounts receivables. This business process begins with receipt of information resulting from the Process Claim business process, performing required manipulation according to business rules and formatting the results into the required output information that process sends to Send Outbound Transaction.

The Inquire Payment Status business process begins with receiving an Accredited Standards Committee (ASC) X12 276 Health Care Claim Status Request transaction or a request for information received through other means such as email, paper, telephone, facsimile, web, or Automated Voice Response (AVR). The business process handles the request for the status of a specified claim(s), retrieves information from the claims payment history, and generates the response information. In addition, the business process formats the information into the ASC X12 277 Health Care Information Status Notification transaction, or other mechanism for responding, via the media used to communicate the inquiry, and sends claim status response via the Send Outbound Transaction.

The Manage Data business process is responsible for the preparation of the data sets and delivery to federal agencies (e.g., Centers for Medicare & Medicaid Services (CMS), Social Security Administration (SSA).) Information exchange may include extraction of Medicaid and CHIP Business Information and Solutions (MACBIS) information needs (i.e., fee-for-services, managed care, eligibility and provider information). The Manage Data business process includes activity to extract the information, transform to the required format, encrypt for security, and load the electronic file to the target destination. The uses for the information include: • Research and evaluation of health care activities. • Staff can forecast the utilization and expenditures for a program. • Staff can analyze policy alternatives. • State and federal agencies can respond to congressional inquiries. • Matches to other health related databases.

The Prepare Provider Payment business process is responsible for the preparation of the payment report information. Reports sent via email, mail, or Electronic Data Interchange (EDI) to providers and used to reconcile their accounts receivable. Many Home and Community-Based Services (HCBS) are not part of the traditional Medicaid health plan. Services tend to be member specific and often arranged through a plan of care. Atypical providers who render services for HCBS waivers may not have authorization, or may not adjudicate in the same manner as other health care providers. This business process begins with receipt of HCBS information from the Process Claim business process or capitation information from Process Encounter business process, performing required manipulation according to business rules, and formatting the results into the required information. The capitation payment activity includes a per-member-per-month payment for Managed Care Organizations (MCO), Primary Care Case Managers (PCCM), and other capitated programs. This business process begins with a timetable for scheduled correspondence stipulated by Trading Partner Agreement (TPA) and includes retrieving enrollment and benefit transaction information from the Member data store, retrieving the rate information associated with the plan from the Provider or Contractor data store, and formatting the payment into the required information.