MEDICAID AND WORKERS COMPENSATION
KAREN STEVENSMAAT235- LUKIC
December 12, 2016Final portfolio
Medicaid and Workers Compensation 1
Table of Contents
Executive summaryOverview of Medicaid and Workers Compensation…………………………………………………………2-3
TerminologyCommon language associated with Medicaid and Workers Compensation……………………4-6
ReportDetailed descriptions of Medicaid and Workers Compensation……………………………………..7-14
ConclusionReport and research inferences……………………………………………………………………………………14
ReferencesA list of sources utilized for presentation completion…………………………………………………15
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Executive Summary
MEDICAID
Medicaid is a widely-recognized health insurance company. It was enacted under the
same statue as Medicare in 1965 (Mitchell, Baumrucker, Herz, 2015, 1). This program is
intended for low income people who have few resources to provide medical care (Valerius,
Bayes, Newby, Blochowiak, 2017, 17). 72% of those enrolled are covered a by managed care
(Mitchell, Baumrucker, Herz, 2015, 12). Most commonly resembling a HMO plan (not always
and at state discretion). This tells us it generally operates within a network of medical
professionals. Funding is jointly participated by Federal and State governments. Broad
expectations are implemented Federally while; each state elaborates their own program. As
medical professionals, we should know the criterion, benefits, and covered services will vary in
each state. Coverage will need to be verified each visit. Federally expectations must be met to
receive funding on this level (Valerius, Bayes, Newby, Blochowiak, 2017, 17). All states choose
to participate in Medicaid voluntarily. Although not mandated Federally, in 2014 this program
represented 15% of the U.S. health care spending, supplying insurance coverage to
approximately 65 million people. The cost was a substantial $498 billion (Mitchell, Baumrucker,
Herz, 2015, 1). The sheer numbers involved, means a biller / medical professional will feasibly
experience Medicaid.
The prevalence of Medicaid, impacts many people and consumes substantial funds;
which is why it was chosen as an addressed topic. It will likely be encountered, so a basic
comprehension is beneficial. Due to the fact, each state has its’ own program and conditions of it
may change- elevates the need to be cognizant of this health care entity. Further, throughout
independent research, I am noticing a grave lack of basic health insurance competency among
consumers. By researching Medicaid, I can use this cognition to educate consumers (and staff)
associated with this facility. Thus, customer service will satisfy, gaining a positive reputation for
myself and company.
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WORKER’S COMPENSATION
Unlike Medicaid, worker’s compensation has no explicit Federal directives, but does
associate with Department of Labor (Szymendera, 2016, 21). Each state has enacted an
independent version and overtime, has progressed to what we recognize today as worker’s
compensation. States dictate if managed care participation is required. However, many are
leaning on the benefits (like getting employees back to work) and cost control of these plans. It is
purchased by employers with more than 3 employees to cover work-related injuries and illnesses
(Valerius, Bayes, Newby, Blochowiak, 2017, 396). Employers may have a choice of state
Workers Compensation insurance, private insurance, or self -insurance to cover workers.
Previously, it was sometimes referred to as the ‘grand bargain’ as it benefits employers and
employees alike. The bargain: employees prevent out of pocket, work related medical costs and
gain a percentage of lost wages (within state expectations). While, employers are adverting
lawsuits (Szymendera, 2016, 1). Today, proper worker’s compensation course of actions is more
clearly defined. Comprehending the process will streamline the reimbursement processes
correlating to a work-related injury/ illness. Also, as a medical worker provisions are equally
important. Such as, those utilizing worker’s compensation forfeit protection under the HIPAA
privacy rule. Meaning, employers have access to case pertinent documentation without requiring
patient consent.
The afore mentioned statement is a great example of why I chose to discuss worker’s
compensation. Most of us, have or will be covered under this insurance at some point.
Employment in the medical field means we will also likely encounter it. It is essential to
understand the rights and processes for those involved and the differences working with this
insurance. As well as, ensuring we all conduct acts in accordance with statues and job requisites.
A prime example of ‘knowledge is power’.
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TERMINOLOGY
Abbreviations are displayed followed by common insurance language. The terms are
specific and not inclusive of those utilized by Medicaid and Worker’s Compensation.
ACA- Affordable Care Act
CHIP- Children’s Health Insurance Program (s-state)
CMS- Center for Medicare & Medicaid Services
DOB- Date of Birth
DOS- Date of Service
DX- Diagnosis
EOC- Episode of Care
ER- Emergency room
FMAP- Federal Medical Assistance Percentage
HMO- Health Maintenance Organization
NonPAR- nonparticipating
OSHA- Occupational Safety and Health Administration
OV- Office Visit
OWCP- Office of Workers Compensation Programs
PAR- participating
PT- patient
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SMI- Supplementary Medical Insurance
SSN- Social security number
TPA- Third-party claims administer
TPO- Treatment, Payment, and healthcare Operations
Affordable care act- health insurance reform, meant to improve coverage and benefits (expanded Medicaid)
Benefits- services that are covered and compensated; advantages
Carrier- health plan, insurance company, payer
Cash benefits- money paid to insured for lost wages
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Categorically needy- criteria that are met for eligibility
Center for Medicare & Medicaid services- division of government responsible for Medicare, Medicaid, and other health programs that operate within HHS
Claim- a formal request for reimbursement
Co-insurance- percentage of charges owed by patient for services, the other portion is paid by carrier
Co-payment- numeration due by patient at the time of service to provider, required and defined by insurance company
Cost sharing- division of financial responsibility
Covered services- supported procedures and services that are defined by the insurance company
Deductible- yearly monetary value that must be paid by the insured before a health insurance plan can go into effect
Disability benefits- assistance (monetary) provided by insurance company to those temporarily, permanently, partially, or fully disabled
Dual eligible- Medicare and Medicaid beneficiary
Eligibility- meeting stipulated requirements; qualifying for
Employer cost- value the employer is responsible for
Enrollee- person receiving health insurance
Federal medical assistance percentage- factor that determines federal financial participation
Fee-for-service- payment method based on provider’s charge for their (specific) service
Funding- a supply of resources used to sustain objectives
Legislation- laws mandating conduct
Managed care- cost effective system responsible for managing finances and health care services
Medical benefits- services and procedures that are covered and compensated by insurance
Out-of-pocket- the money paid at the expense of the patient
Payer-health plan, carrier, insurance company
Premiums- money the insured pay to the carrier for a health care policy
Provider payments- money dispersed by insurance company
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In order to function lucratively and offer superior service, we need to discuss Medicaid
and Workers Compensation regulations. Medicaid can be arduous to comprehend because states
administer their own principles under Federal guidelines. Federal expectations are required by all
states, to receive funding. Workers compensation functions under different pretenses. Although it
varies from state to state like Medicaid, purposes and processes are more clear. This program
lacks gravity of federal oversight that Medicaid exhibits. We will examine Federal regulations
and any state specific information will pertain to our state of employment, New York.
Medicaid can be represented as fee for service or managed care. A fee for service
enrollee can seek treatment from any provider, as long as they accept Medicaid insurance. Over
half of plans work within managed care networks. Meaning, enrollees are bound to choose from
network physicians and abide by referral criteria. Managed care can be mandatory or voluntary,
supporting state dictations. Participants are provided a member card with an access number, used
on claims. As professionals, we need to authenticate eligibility (with these cards) before each
visit. Deductibles, coinsurance, copayments, and exemptions exist (Valerius, Bayes, Newby,
Blochowiak, 2014, 363-364). Monetary plan contributions vary by state, some noting required
payments on enrollee card. Federally, there is a maximum out-of-pocket cap; so, fees cannot
exceed this set value (CMS, n.d.).
Federally, claim submissions for Medicaid have advanced over recent years. For
example, filings use procedure and diagnosis codes. Procedure codes are obtained from HCPCS
and diagnosis codes are retrieved from ICD-10-CM code sets. Using the codes properly will
create a code link; telling the payer medical necessity requirements have been met (vary to some
extent between states). This needs to happen for a claim submission to be successful. Medicaid
should always be the last payer to be billed (OASAS, 2016, 6,9). Pay close attention if the
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enrollee is dual eligible. Clean claims usually receive payment within thirty days. Unless, the
practice is converting to electronic submission. A paper filing, clean claim can assume reparation
inside forty-five days. A provider is allocated ninety days; after a denial, to dispute the claim
(WellCare, 2016, 84-86). Contracts between Medicaid and physicians with the Department of
Health and Human Services (D.O.H.H.S) often declare, Medicaid payments are to be accepted as
‘paid in full’. Any financial discord are entered as a tax write off (Valerius, Bayes, Newby,
Blochowiak, 2014, 363).
NY claims also use HCPCS and ICD-10-CM code sets in an 837-electronic format.
Practices in the process of converting, use CMS-1500 forms. NY billers should know particular
billing regulations may apply. For instance, Medicaid will pay for 100% of a primary surgery;
50% for a secondary surgery; and 25% for additional procedures. New York filings are
submitted to managed care providers by out-of-network assistance, no later than fifteen months
from the date of service (DOS). In- network claims are given 120 days for submission. If this
insurance is used as a second payer, there is a ninety-day cutoff. Tax ID numbers, NPI numbers,
preauthorization numbers are expected to be provided, when applicable (WellCare, 2016, 82,91).
Thus far, we can see that varying state requirements feature Medicaid complexity.
The benefits, attributes, and standard costs of Medicaid also differ from state to state;
operating under Federal instruction. As previously stated, the Federal government imposes a
maximum out-of-pocket cost. While, states determine deductibles, copays, and exemptions. The
maximum out-of-pocket costs are determined by the Federal Poverty level and are reviewed
annually. So, we all need to maintain current literacy of Medicaid out-of-pocket fees. In 2013,
deductibles climaxed at $2.65: managed care copays $4: institute care $75: nonemergency $8:
Medicaid and Workers Compensation 9
referred prescriptions $4: and non-referred drugs $8. The Federal government dictates out-of-
pocket fees are not to exceed five percent of the enrollee income (CMS, n.d.).
Federal law offers two primary benefit packages that are elaborated by individual states.
These packages represent services covered. The traditional benefit package is required to cover
inpatient hospital visits, labs, nursing homes, and x-rays. This provision operates under state
wide rules. Alternative benefits, on the other hand, do not conduct within state wide rules. This
plan covers family planning and emergency/nonemergency transportation services (Mitchell,
Baumrucker, Herz, 2015, 7). When seeking increased benefit and cost cognition, we would
explore state specific standards.
While each state may have different Medicaid administers (NY- Department of Health
[DOH]); the financial security, funding, and future have more certainty than other aspects of
Medicaid. This government sponsored health care program benefits those who are categorically
needy. It is funded jointly between state and federal government, as long as, a state meets federal
requirements (Valerius, Bayes, Newby, Blochowiak, 2014, 17). The Federal government cost
share is dispersed annually and it is resolved using FMAP (federal medical assistance
percentage) calculations. Up to sixty percent of a state’s obligation can be accessed through local
government (Mitchell, Baumrucker, Herz, 2015, 11,13). Understanding funding is just as
important as comprehending security of these plans.
The Medicaid program is designed to contest fraud, abuse, and waste. For example,
claims are investigated ensuring code linkage and medical necessity. Over or mispayments are
recovered from responsible providers. Enrollment eligibility are reviewed every six months
(Mitchell, Baumrucker, Herz, 2015, 21). The federal government projects laws on a federal level.
While, states regulate insurance companies, record keeping, and liscensing. Basically, there is
Medicaid and Workers Compensation 10
immense supervision regarding Medicaid. The benefit, Medicaid will be around long into the
future. This program is also equipped to adapt to change with growing health care systems in this
country- proving Medicaid is durable.
These changes occur when legislation demands it. Probably the most dramatic impact
came to Medicaid with the passing of the Affordable Care Act (ACA). The goal was to create
consistency among Medicaid, Medicare, and CHIP. As well as, increase access to health care.
For example, eligibility was expanded to people under sixty-five who represent 133% of the
Federal Poverty level (Mitchell, Baumrucker, Herz, 2015, 21). Medicaid can now be obtained
through DSS (Department of Social Services) with proof of assets. Applicants can now appeal a
denial (Valerius, Bayes, Newby, Blochowiak, 2014, 352). Further, services cannot lawfully be
withheld due to inability to pay because the target group is categorically needy (CMS, n.d.). So,
did the ACA achieve goals that were set in place? Not necessarily. In 2012, the Supreme Court
determined the Federal government could not revoke their portion of funding solely because a
state opts out of Medicaid expansion. On January 1, 2014, the maturation became state optional;
of which, many have embraced. The impact of the ACA on Medicaid is relevant. New ACA
annual health insurance fees increase Medicaid output because Medicaid MCO rates elevate
(Mitchell, Baumrucker, Herz, 2015, 21-22). Medicaid is designed to handle legislative alterations
and has stood strong after the ACA enacted. New regulations and legislations will likely occur in
the future. The strength of this program rests on joint government participation. Although costs
may be affected, the solidarity of this program will continue to aid those eligible. Without a
doubt, Medicaid has a will stand the test of time.
Workers compensation is a whole different entity than Medicaid. In fact, it varies from
most health insurance plans; operating under different standards and with specific purpose. Each
Medicaid and Workers Compensation 11
state lists covered services, but reserves the right to deny claims. A claim could be refused for
example, if appropriate/provided safety equipment was not being used at the time of injury
(Valerius, Bayes, Newby, Blochowiak, 2014, 398). All parties involved have important roles for
successful acquisition of reimbursement. To follow claim expectations, an employer is required
to report injuries to the state Workers Compensation board and insurance within state assigned
time frames. The employer (human resources) then directs the worker to a network physician for
medical services. Other expectations are state specific. For instance, NY has a record retention
requisite. Data for one calendar year (from point of injury), is kept in original form for a
minimum of three years (Workers compensation board, 2016). Although an employer may
voluntarily follow the case, the extent of mandatory involvement ends here. A physician treats,
determines scope (if any) of disability, and monitors a progression back to work. The insurance
is responsible for assigning claim numbers (used to ID claims) and defining case eligibility. The
results will either be ‘admission of liability’ or ‘notice of contest’, to which the worker is
informed. Claim checks covering medical expenses are sent directly to the provider. While, lost
wage benefits are allocated to the employee without tax deduction; until criteria have been met
and termination of compensation is appropriate (Valerius, Bayes, Newby, Blochowiak, 2014,
400). As billers, we need to recognize consistent reimbursement standards associated with
Workers Compensation.
First, a patient will not have out-of-pocket fees and should not be charged for a visit
(Szymendera, 2016, 19). Also, private insurances are not billed for Workers Compensation
related services. The claim will be denied because most payers do not restitute such
circumstances. Unlike Medicaid, Workers Compensation claims (most states) are filed manually
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using CMS 1500 forms. Copies of office notes (documentation and treatment) accompany the
form to the insurance. The reason manually submission is preferred, is vast handling occurs.
States dictate and implement benefits, attributes, and costs to consumer. One common
denominator in states that offer Workers Compensation, they cover employee medically
necessary expenses and a percentage of lost wages (Valerius, Bayes, Newby, Blochowiak, 2014,
396). Although it is understood a patient pays no out-of-pocket expenses; in 2013, Worker
Compensation cost employers a staggering $88.5 billion. A portion of this is benefit payments.
Benefits differ from state to state, but likely include cash benefits. Cash benefits are not
considered income, which is why lost wage reparation is not subject to tax deduction
(Szymendera, 2016, 14,19). Benefits use a deductible provision. It is not a traditional deductible.
Instead, this means cash benefits are held for the first seven days from date of injury; unless,
injury exceeds fourteen days. To which, a retro of the first seven days occurs (Valerius, Bayes,
Newby, Blochowiak, 2014, 397).
Other benefits may include disability, survivor, and burial. In most states, disability
privileges have minimum and maximum coverage capacity. For example, partial disability has a
cap and is based on a percentage of predisability wages (Szymendera, 2016, 14). Some cover
rehabilitation services. In the event death occurs to the worker, survivor benefits are allocated
monthly to family/dependents. Burial benefits are a one-time sum paid regardless if dependents
exist. Costs and benefits vary from state. Billers should familiarize regulations in their state of
employment.
It is important to understand Workers Compensation funding, security, and future. We
are going to examine oversight. This program is administered by the OWCP, which is a division
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of the department of labor (Valerius, Bayes, Newby, Blochowiak, 2014, 395). Further, human
resources have justifiable handling. After injury, employees are assigned an adjuster. Much of
case monitoring is maintained by the adjuster, who specializes in care coordination including,
but not limited to; authorizing treatments, sending compensation investigators (to ensure
employee follows case plan), and supervising all case pertinent progress. The goal of an adjuster
is to protect a payers’ integrity and encourage a back to work transition. Providers will likely
encounter oversight participants.
Workers compensation is fully paid by an employer who may engage three funding
options. First, an employer can obtain state funded Workers Compensation. In this situation,
copays and premiums are directed to a central state fund, from which claims are paid. Another
option is a private plan. An employer works with a payer to gain access and benefits of network
providers. Usually network providers work with a common aspiration to get the injured back to
work as soon as medically possible. Some states allow a third, alternate funding option; self-
insurance. This means an employer sets up a personal fund from which claims are paid. Most
states allowing the third option, require preauthorization and later, proof to the Workers
Compensation board (Valerius, Bayes, Newby, Blochowiak, 2014, 396). This program differs in
how health care is provided. The chosen funding defines who has the most control over the case,
the employee or employer (Szymendera, 2016, 12). While security and funding appear sturdy,
the future of Workers Compensation is unknown, at best. Partially because of insufficient
Federal oversight. Unlike most other insurances, how much an employer pays out may affect
hiring wages. Often, lower starting wages offset an employer’s monetary output for insurance.
This program is vulnerable to legislative changes.
Medicaid and Workers Compensation 14
Statues for this program have progressed over time. The 1970, Occupational Safety and
Health Act made the work environment safer for employees. For example, requiring material
data sheets for chemicals and making available safety equipment. Other expectations about
benefits exist. In fact, 39/50 states allow lifetime benefits to be paid; while, the other eleven cap
benefits by age, duration, or predetermined monetary amount (Szymendera, 2016, 12,16-17).
Benefits were among new legislation aspirations by President Obama.
President Obama wanted to change how benefits are allocated for disability. His
suggestion, convert from service of benefits to a lump sum. He also advocated halting disability
payments at retiring age because recipients would become eligible for social security. Whatever
Obama’s intent, these entities were not submitted in the 2017 budget request. This was not the
first-time changes to this program were adverted due to Federal budget restraints. In 2015, there
was a prompting for increased federal oversight of Workers Compensation (Szymendera, 2016,
15, 25). This would give long-term stability to the program. However, this attempt for
modification fell short of budget abilities.
Despite the type of insurance, billers need to be cognizant of factors involving pertinent
operations. Understanding reimbursement regulations and financial aspects are critical for
participation in a successful revenue cycle. From this, we identify societal impacts. It attributes
to professionalism and allows us to provide a higher degree of care. Comprehending past
legislation and its’ affects permits anticipation for future statues that could impact the
functionality of a program. We need to become life-long learners because of the constant
changes to the health care system. The changes offer new occupational opportunities and develop
a sense of job security. Knowledge and informational literacy help prepare us to effectively
operate a practice. It also contributes to the financial security of a business. We can all use this
Medicaid and Workers Compensation 15
data to have productive client interactions, victorious claim submission, and achieve lucrative
reimbursement with increased integrity and compliance.
REFERENCES:
CMS (n.d). Cost sharing out of pocket costs: Medicaid. Retrieved from
https://www.medicaid.gov/medicaid/cost-sharing/out-of-pocket-costs/index/list of
benefits/reimbursement
Mitchell, A., Baumrucker, E., Herz, E. (2015). Medicaid overview. Congressional research
service. Retrieved from Ebsco host database.
OASAS (2016). General Medicaid billing information. Retrieved from
https://www.oasas.ny.gov/admin/hcf/reimburs.cfm
Szymendera, S. (2016). Worker’s compensation overview and issues. Congressional research
service. Retrieved from Ebsco host database.
Valerius, J., Bayes, N., Newby, C., Blochowiak, A. (2014). Medical insurance: a revenue cycle
process approach (7). McGraw Hill; New York: NY.
WellCare (2016). Medicaid provider manual- NY. Retrieved from
https://www.Medicaid.NYS.gov
Workers Compensation Board (2016). Laws, regulations, and decisions. Retrieved from
http://www.wcb.gov/content/main/wclaws/recentlyadopted/part3