BCBSM: 835 File to BST Nancy Drury, CPA Deborah Sieradzki, PhD Lubaway, Masten & Company Great Lakes HFMA Reimbursement Update September 26, 2014.

BCBSM:835 File to BST

Nancy Drury, CPA

Deborah Sieradzki, PhD

Lubaway, Masten & Company

Great Lakes HFMA Reimbursement Update

September 26, 2014

AGENDA

• Blue Cross Cycle• Blue Cross Payment Logs• Interim Payment Review• Monthly Contractual Model and/or Balance Sheet Test (BST)

• Interim and Final Settlement

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Why Do We Care?

• Blue Cross Substantial Part of Hospital’s Business

• Due to administrative complexities, it is challenging to have a handle on the process

• HUGE Negative Impacts

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File Cost Report

RebasingIP and OP Settlement

Rates

IP and OP Vouchered

Rates

BIP Review

Final Settlement

Initial Settlement

Vouchered Claims

Blue Cross Cycle

Periodic Balance

Sheet Test

Monthly Contractual

Model

BLUE CROSS LOGS

Blue Cross Payment Logs

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Maintaining accurate record of cleared claims is ESSENTIAL for:

• Accurate settlement calculations for Financial Statements

• Reasonableness of interim payments

• Accuracy of interim and final settlements

Easier said than done!!!!!

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Blue Cross Logs

• Logs are compilations of cleared charges and other information summarized from Electronic Remittance Advices (835).

• Data file “loops” so it’s impossible to interpret volume of data without converting data into readable format

Sample 835 File

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The 835 file contains payment, charge and statistical data for each claim accepted. It contains rejection codes for claims not paid. This data is posted to the hospital’s A/R.

Much of the data on the 835 is echoed back from the 837 billing files submitted by the provider.

• Once the 835 file has been parsed, save it in a human readable file with titles.

• Detail is tied to Control Totals• The data is then “Tweaked”

Parse 835 File to Make Data Readable

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Blue Cross 835 FilesTricks ----- No Treats.

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LOGGING ISSUE #1:KNOW WHAT’S IN YOUR BIP

• Receive MANY 835 files from Blue Cross• Not all are included in BIP and settlement

calculation• Includes both Professional and Hospital• Includes BCBSM, FEP, MOS, NASCO, Medicare

Advantage, BCN, Blue Cross Complete, Medicaid, Domestic Claims

• Knowing distribution schedule can help ID

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Logging Issue #2:SIZE OF FILES

• Volume of 835 files are substantial – pick and choose data elements to log

• Method of managing data – payer type, software, claims cut-off date, etc.

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Logging Issue #3:What you see is NOT what you get

What is clearing on the voucher as payment may not be a good representation of your settlement.

• DRG > Charge reimbursement• Vouchered Rate ≠ Settlement Rate• Differences can be substantial• Need to determine how you will build into

model

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Vouchered Rates DO NOT EQUAL Settlement RatesIP Settlement Rates

Operating Cost per Case+ Capital+ GME+ Bad Debt and Charity Care+ Other+ P4P= Inpatient Settlement Rate+ Vouchering Differential+ Trend Factor+ Lesser Of Charge or DRG Adjustment= Vouchered Rate

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Fee Screen or Percent of Charges for Cost Based+ OP Passthrough Factor+ P4P= OP Fee Screen or Cost Based Settlement+ Trend Factor+ Adjustment to Passthrough Factor= OP Vouchered Fee Screen or Cost Settlement

Difference can be substantial!

Vouchered Rates DO NOT EQUAL Settlement RatesOP Settlement Rates

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Logging Issue #4:Know What Is Clearing

• Remove rejected claims and other excluded from settlement (ie: domestic claims) if applicable

• Understand zero pays• Know your specific issues and decide how to

address – examples:• Babies for Blue Care Network• Claim Status 22• No DRG Assignment

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Logging Issue #5:Manual Adjustments Are Required

• 835 files are not always complete• Blue Care Network files lack data essential to

get clearings in the proper buckets for settlement – this needs to be input manually

• DRG # is included – weight is not. Need to pull same period into logs from a separate source document

• Take-backs are counted as a discharge

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Logging Issue #6:So Many Codes!

• Properly categorizing patient data is essential for properly calculating settlement

• Companion documents:4010: http://www.bcbsm.com/pdf/837_835_institutional_companion.pdf

5010: http://www.bcbsm.com/content/dam/public/Providers/Documents/835-companion-document.pdf

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Claim Status Codes

• Over 15 different status codes• Examples:

• Claim Status #1 – Primary Claim• Claim Status #2 – Secondary Claim• Claim Status #4 – Denied• Claim Status #22 – Reversal of Previous

Payment

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Type of Payment Indicator Code

• Determines what bucket the claims goes into for settlement purposes

• 5 positions within the code that define the claim

• Not every position is populated• Currently know of 140+ combinations• See companion guide for complete list

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Type of Payment Indicator CodePosition 1 – Voucher Codes

1=Inpatient Regular3=Outpatient Regular5=BC Complementary IP6=BC Complementary OP

Position 2 – Accommodation Codes0=BC-65 OP Complementary1=Regular IP Hospital Admission2=BC-65 IP Hospital Admission3=Regular OP

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Type of Payment Indicator Code

Position 3 – Method of ReimbursementB = Blue Care NetworkC = PHA Controlled CostP = PPO TrustR = PHA Per Diem

Position 4 – Provider Contract IndicatorBlank = PHAB = Blue Care NetworkT = Trust/PPO

Position 5 – Special Use Indicator% = Percent of PHA

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Type of Payment Indicator Code Example

Code: 11Voucher Code = 1Accommodation Code = 1Method of Reimbursement = BlankProvider Contract Indicator = BlankSpecial Use Indicator = Blank

Patient = Inpatient Regular/RegIP Admission/PHA

Include in IP Traditional Settled

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Type of Payment Indicator Code Example

Code 33 TVoucher Code =3Accommodation Code = 3Method of Reimbursement = BlankProvider Contract Indicator = TSpecial Use Indicator = Blank

Patient = OP Regular/Regular OP/Trust Patient

Include in OP PPO Settled

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Type of Payment Indicator Code Example

Code 60LT%Voucher Code =6Accommodation Code = 0Method of Reimbursement = LProvider Contract Indicator = TSpecial Use Indicator = %

Patient = BC Complementary OP/BC-65/PHA Lower of Cost or Charge/Trust_PPO/Percent of PHA

Include in Non-Settled

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INTERIM PAYMENTS (BIP)

• Receive a weekly estimated payment (BIP) instead of payment that is specific to an 835 file

• Periodic BIP reviews are done to determine reasonableness of weekly payments based on cleared claims

• Logs are a key component to determining whether BIP reviews are accurate

BALANCE SHEET TEST

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Balance Sheet Test

Know what is in your AR so you can reserve appropriately

• Blues products not included in BIP are reserved differently than those in BIP

• Calculate estimate on copays & deductibles if still in primary payer code

SETTLEMENT

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SettlementSETTLEMENT BALANCE =

EXPECTED PAYMENT less BIP

• Don’t operate in a vacuum!• Make sure your contractual model / BST are

reasonable compared to BIP reviews and other correspondence from Blues

• Remember to include claims after cut-off that occur in the following year

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Settlement

• In a perfect world, 835 logs would tie exactly to settlement detail – they won’t

• Some data elements used for settlement are not evident in the 835 file – hard to get in proper bucket

• Transfer cases not always identified with discharge fraction

• Count on take-backs can cause an issue

[email protected]

[email protected]

(248) 347-1416