Revenue Cycle Management Glossary
Baffled by RCM lingo? No worries! Get up to speed with our handy list of common terms.
Abuse is the intentional misuse or excessive use of healthcare services, resources, or billing practices for personal gain or financial advantage.
Accountable care organization (ACO)
Accountable care organization (ACO) is a healthcare model where a group of providers collaboratively manage and coordinate care for a specific patient population.
Accounts receivable (AR)
Accounts receivable (AR) is the outstanding payments owed to a healthcare organization by patients or insurance companies for services rendered.
Accrual accounting is a method of recording financial transactions when they occur, regardless of when the payment is received or made.
Adjudication is the process of evaluating and determining the validity and reimbursement amount of a healthcare claim by a payer.
Administrative denial is the rejection of a healthcare claim due to non-medical reasons, such as missing information or incorrect coding, resulting in non-payment.
Advance beneficiary notification of noncoverage (ABN)
Advance beneficiary notification of noncoverage (ABN) is a Medicare form used to inform beneficiaries that a specific service may not be covered, allowing them to make an informed decision.
Adverse selection is the phenomenon where individuals with higher risk or poorer health are more likely to seek and utilize healthcare services.
Allowable charge is the maximum amount that a healthcare provider is permitted to bill for a specific service or procedure, as determined by the payer.
Alternative payment model (APM)
Alternative payment model (APM) is a reimbursement approach that deviates from traditional fee-for-service, promoting value-based care by linking payments to quality and cost outcomes.
Ambulatory payment classification (APC)
Ambulatory payment classification (APC) is a Medicare payment system that classifies outpatient services into groups based on similar clinical characteristics and costs.
Appeal is a formal request made by a healthcare provider to challenge a denied claim or reimbursement decision by an insurance company or payer.
Assignment of benefits
Assignment of benefits is a legal agreement where a patient authorizes their healthcare provider to receive direct payment from the insurance company for services rendered.
Attribution is the process of assigning financial responsibility for healthcare services to the appropriate payer, ensuring accurate reimbursement.
Audit is a systematic examination of financial records, coding accuracy, and compliance with regulations to ensure accuracy, identify errors, and mitigate risks.
Base payment rate
Base payment rate is the predetermined amount established by payers for specific healthcare services, serving as the starting point for reimbursement calculations.
Benchmarking is the process of comparing an organization's performance metrics against industry standards to identify areas for improvement.
Beneficiary is an individual or entity who receives healthcare services and is eligible to receive benefits from a health insurance plan or government program.
Benefit is a positive outcome or advantage gained from a specific action, process, or system, resulting in improved healthcare revenue cycle management.
Benefit period is the specific timeframe during which an insurance policyholder is eligible to receive benefits for covered healthcare services.
Bundled payment is a reimbursement model where healthcare providers receive a single payment for a group of services related to a specific episode of care.
Bundling is the process of grouping multiple healthcare services or procedures together and billing them as a single unit for reimbursement purposes.
CC/MCC exclusion list
CC/MCC exclusion list is a compilation of diagnoses that are considered complications or comorbidities, which are excluded from the calculation of severity of illness for Medicare reimbursement.
CMS hierarchical condition categories (CMS- HCC) model
CMS hierarchical condition categories (CMS-HCC) model is a risk adjustment methodology used by CMS to predict healthcare costs based on patient diagnoses.
CMS program transmittal
CMS program transmittal is a document issued by the Centers for Medicare and Medicaid Services (CMS) to communicate changes or updates to Medicare program policies and instructions.
CPT Assistant is a publication by the American Medical Association (AMA) providing official guidance and clarifications on Current Procedural Terminology (CPT) codes.
Capitation is a payment model in healthcare where providers receive a fixed amount per patient, regardless of the services rendered or costs incurred.
Case mix is a measure of the types and complexity of patients treated within a healthcare facility, determining the resources required and influencing reimbursement rates.
Case-mix group (CMG)
Case-mix group (CMG) is a classification system used in healthcare RCM to group patients with similar clinical characteristics and resource needs.
Case-mix index (CMI)
Case-mix index (CMI) is a numerical value representing the average complexity and resource utilization of patients treated in a healthcare facility.
Case-rate methodology is a reimbursement approach in healthcare RCM where a fixed payment is made for a specific medical condition or procedure, regardless of actual costs incurred.
Cash accounting is a financial method that records revenue and expenses when actual cash is received or paid out, providing real-time cash flow visibility.
Category II CPT code
Category II CPT code is a set of supplemental tracking codes used in healthcare revenue cycle management to measure performance and quality of care provided.
Certificate of insurance
Certificate of insurance is a document that provides proof of insurance coverage, including policy details and limits, for a specific individual or entity.
Charge is the monetary amount assigned to a specific healthcare service or procedure, representing the price set by the healthcare provider for that particular service.
Charge capture is the process of accurately capturing and recording all billable services and procedures provided to a patient for proper reimbursement.
Charge code is a unique alphanumeric identifier assigned to a specific medical service or procedure, used for billing and reimbursement purposes in healthcare revenue cycle management (RCM).
Charge description is a concise and detailed explanation of the services or procedures provided to a patient, including the associated costs and billing codes.
Charge description master (CDM)
Charge description master (CDM) is a comprehensive database that contains detailed information about healthcare services, procedures, and supplies, including their corresponding charges.
Charge status indicator
Charge status indicator is a code used in healthcare revenue cycle management to identify the status of a charge, such as billed, denied, or pending.
Children's Health Insurance Program (CHIP)
Children's Health Insurance Program (CHIP) is a federal program in the United States that provides low-cost or free health coverage to eligible children in families with limited income.
Chronic conditions special needs program (C-SNP)
Chronic conditions special needs program (C-SNP) is a Medicare Advantage plan designed for individuals with chronic health conditions, providing specialized care and services.
Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA)
CHAMPVA is a healthcare program administered by the Department of Veterans Affairs (VA) that provides medical coverage for eligible dependents of veterans.
Claim is a formal request submitted by a healthcare provider to an insurance company or payer for reimbursement of services rendered to a patient.
Classification system is a structured framework that categorizes and organizes data or entities based on predefined criteria for efficient management and analysis.
Clinical denial is the rejection of a healthcare claim by an insurance payer due to a discrepancy between the clinical documentation and the billed services.
Clinical documentation integrity (CDI)
Clinical documentation integrity (CDI) is the process of ensuring accurate and complete clinical documentation to support appropriate coding and billing for healthcare services.
Clinical validation denial
Clinical validation denial is the rejection of a healthcare claim due to insufficient or inaccurate clinical documentation supporting the medical necessity of services provided.
Coding compliance plan
Coding compliance plan is a documented strategy outlining measures to ensure accurate and compliant medical coding practices within healthcare organizations.
Coding management is the process of overseeing and optimizing the accurate assignment of medical codes to healthcare services and procedures.
Coinsurance is the percentage of healthcare costs that a patient is responsible for paying after meeting their deductible, in addition to the amount covered by their insurance.
Community rating is a healthcare pricing model where insurance premiums are determined based on the average cost of providing care to a specific geographic area's population.
Comorbidity is the presence of two or more chronic conditions or diseases in a patient simultaneously, requiring comprehensive healthcare management.
Compliance is adherence to legal and regulatory requirements, industry standards, and internal policies to ensure ethical and lawful practices.
Complication is an unforeseen issue or problem that arises during the healthcare revenue cycle management process, potentially hindering the smooth flow of financial operations.
Complications and comorbidities (CCs)
Complications and comorbidities (CCs) are additional medical conditions or factors that coexist with a patient's primary diagnosis, impacting healthcare treatment and reimbursement.
Comprehensive Error Rate Testing (CERT) Program
Comprehensive Error Rate Testing (CERT) program is a CMS initiative that measures improper payments in Medicare fee-for-service claims.
Computer-assisted coding (CAC)
Computer-assisted coding (CAC) is an automated process that utilizes software to assist in assigning appropriate medical codes to patient records.
Contractual allowance is the predetermined reduction in payment that healthcare providers accept from insurance companies as part of the negotiated contract.
Conversion factor (CF)
Conversion factor (CF) is a numerical value used to convert relative value units (RVUs) into payment rates for healthcare services in the revenue cycle management (RCM) process.
Coordination of benefits (COB)
Coordination of benefits (COB) is the process of determining the order in which multiple health insurance plans will pay for a patient's medical expenses.
Copayment is a fixed amount that a patient pays out-of-pocket for a specific healthcare service at the time of receiving care.
Cost report is a financial document submitted by healthcare providers to Medicare, detailing the costs incurred in delivering services to patients.
Cost sharing is the practice of dividing healthcare expenses between the patient and the insurance provider, where both parties contribute a portion of the costs.
Cost-of-living adjustment (COLA)
Cost-of-living adjustment (COLA) is an annual increase in wages or benefits to account for changes in the cost of living, typically based on inflation.
Coverage gap is a period during which an individual lacks health insurance coverage, resulting in limited access to healthcare services and potential financial burden.
Covered condition is a medical diagnosis or treatment that is eligible for reimbursement by a patient's insurance plan according to their policy terms.
Covered service is a medical procedure, treatment, or healthcare service that is eligible for reimbursement by a patient's insurance plan or government program.
Current Procedural Terminology (CPT)
Current Procedural Terminology (CPT) is a standardized medical code set used to report medical procedures and services for billing and reimbursement purposes.
Deductible is the predetermined amount that an insured individual must pay out of pocket for covered healthcare services before insurance coverage begins.
Demand letter is a formal written communication sent by a healthcare provider to a patient or insurance company, requesting payment for services rendered.
Department code is a unique identifier assigned to a specific department within a healthcare organization, facilitating accurate tracking and allocation of revenue and expenses.
Dependent is a term used in healthcare revenue cycle management (RCM) to describe an individual who relies on another person for financial support or healthcare coverage.
Discharge status code
Discharge status code is a numerical identifier used in healthcare RCM to indicate the patient's condition at the time of discharge from a healthcare facility.
Disease management is a systematic approach that focuses on preventing and controlling chronic illnesses through coordinated healthcare interventions.
Disproportionate share hospital (DHS)
Disproportionate share hospital (DHS) is a healthcare facility that serves a significantly high number of low-income and uninsured patients.
Dual eligible special needs program (D-SNP)
Dual eligible special needs program (D-SNP) is a Medicare Advantage plan designed for individuals eligible for both Medicare and Medicaid, providing coordinated care and additional benefits.
Eligibility is the determination of a patient's qualification for healthcare services based on factors such as insurance coverage, benefits, and provider network.
Employer-based health insurance
Employer-based health insurance is a type of health coverage provided by employers to their employees as part of their employee benefits package.
Encoder is a software tool used in healthcare revenue cycle management (RCM) to assign appropriate codes to medical procedures and diagnoses.
Enrollment is the process of gathering and verifying patient information, insurance details, and demographic data to establish eligibility for healthcare services.
Evaluation and management (E/M) codes
Evaluation and management (E/M) codes are a set of medical billing codes used to classify and reimburse healthcare services provided by physicians based on the complexity and nature of the patient's visit.
Evidence-based clinical practice guideline
Evidence-based clinical practice guideline is a systematically developed recommendation, based on rigorous research, to assist healthcare providers in making informed decisions for patient care.
Exclusion is the process of identifying and removing claims that do not meet the criteria for reimbursement, ensuring compliance and accurate revenue capture.
Explanation of benefits (EOB)
Explanation of benefits (EOB) is a document provided by health insurance companies to policyholders, detailing the costs covered and not covered for a specific medical service or treatment.
False Claims Act
False Claims Act is a federal law that imposes liability on individuals or entities who knowingly submit false or fraudulent claims for payment to the government.
Family coverage is a health insurance plan that provides medical benefits to an entire family unit, typically including spouses and dependent children.
Federal Employees' Compensation Act of 1916 (FECA)
Federal Employees' Compensation Act of 1916 (FECA) is a U.S. federal law that provides workers' compensation benefits to federal employees injured on the job.
Federal Register is a daily publication that provides public notice of proposed regulations, final rules, and other federal government documents.
Fee schedule is a predetermined list of charges established by healthcare providers for specific medical services or procedures.
Final rule is a regulation issued by a government agency that establishes the official and binding requirements for a specific program or industry.
Formulary is a list of prescription drugs covered by a specific health insurance plan, indicating the preferred medications and their coverage details.
Fraud is intentional deception or misrepresentation, involving false claims, documents, or actions, aimed at obtaining unauthorized benefits or financial gain.
Gatekeeper is a term used in healthcare revenue cycle management (RCM) to refer to the individual or system responsible for controlling access to patient information and managing the flow of revenue within the healthcare organization.
Geographic practice cost index (GPCT)
Geographic practice cost index (GPCT) is a payment adjustment factor used in Medicare reimbursement to account for regional variations in healthcare costs.
Global payment method
Global payment method is a reimbursement model in healthcare RCM where a fixed amount is paid to providers for all services rendered to a patient over a defined period, regardless of the actual services provided or their costs.
Grouper is a software tool used in healthcare revenue cycle management (RCM) to assign diagnosis-related groups (DRGs) for accurate billing and reimbursement.
Guaranteed issue' is a provision in health insurance that requires insurers to offer coverage to all applicants regardless of their health status or pre-existing conditions.
Hard coding is the practice of embedding fixed values or logic directly into the source code of a software program, without using variables or external configuration files.
Health Insurance Portability and Accountability Act of 1996 (HIPAA)
Health Insurance Portability and Accountability Act of 1996 (HIPAA) is a federal law that safeguards patient privacy and sets standards for healthcare data security.
Health maintenance organization (HMO)
Health maintenance organization (HMO) is a managed care plan that provides comprehensive healthcare services to members for a fixed fee.
Health professional shortage areas (HPSAs)
Health professional shortage areas (HPSAs) are geographic regions designated by the Health Resources and Services Administration (HRSA) as having insufficient healthcare providers to meet the population's needs.
Hospital-acquired condition (HAC)
Hospital-acquired condition (HAC) is a medical condition that a patient develops during their hospital stay, which was not present at admission.
ICD-10-CM/PCS Coordination and Maintenance Committee
ICD-10-CM/PCS Coordination and Maintenance Committee is a group responsible for maintaining and updating the ICD-10-CM and ICD-10-PCS code sets.
Improper payment review
Improper payment review is the process of examining healthcare claims and payments to identify and rectify any errors, fraud, or abuse in billing and reimbursement.
Incident to is a billing provision in healthcare RCM that allows non-physician practitioners to bill services under a supervising physician's name.
Indian Health Service (IHS)
Indian Health Service (IHS) is a federal agency within the Department of Health and Human Services responsible for providing healthcare services to Native American and Alaska Native populations.
Indirect medical education (IME)
Indirect medical education (IME) is a Medicare reimbursement program that provides additional funding to teaching hospitals for the higher costs associated with training medical residents.
Individual health insurance
Individual health insurance is a type of coverage that provides medical benefits to a single person, typically purchased directly by the individual.
Institutional special needs program (1-SNP)
Institutional special needs program (1-SNP) is a Medicare Advantage plan designed for individuals residing in institutions, such as nursing homes or long-term care facilities.
Insurance is a contractual agreement in which an individual or entity pays premiums to a company in exchange for financial protection against specified risks.
Integrated revenue cycle (IRC)
Integrated revenue cycle (IRC) is a comprehensive approach that seamlessly connects all stages of healthcare revenue management, from patient registration to claim reimbursement, ensuring efficient and streamlined financial processes.
International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM)
ICD-10-CM is a standardized system used worldwide to classify and code medical diagnoses and procedures for accurate documentation and billing purposes.
International Classification of Diseases, Tenth Revision, Procedure Coding Systems (ICD-10-PCS)
ICD-10-PCS is a standardized medical coding system used to classify and report procedures performed in healthcare settings, ensuring accurate reimbursement and data analysis.
Labor-related share is the portion of healthcare revenue cycle management costs directly attributed to labor expenses, including salaries, benefits, and training.
Limitation is a constraint or restriction that hinders the optimal functioning or performance of healthcare revenue cycle management processes.
Local coverage determination (LCD)
Local coverage determination (LCD) is a policy created by Medicare Administrative Contractors (MACs) to specify coverage criteria for medical services and procedures.
MS-DRG family is a classification system used in healthcare revenue cycle management to group similar diagnoses and procedures for billing purposes.
Major complication and comorbidity (MCC)
Major complication and comorbidity (MCC) is a medical condition or disease that significantly impacts patient care, treatment, and resource utilization.
Major diagnostic category (MDC)
Major diagnostic category (MDC) is a classification system used in healthcare revenue cycle management to group patients with similar diagnoses for billing and reimbursement purposes.
Malpractice (MP) element
Malpractice (MP) element is a legal term referring to professional negligence by a healthcare provider, resulting in harm or injury to a patient.
Managed care is a healthcare delivery system that coordinates and manages medical services to control costs and improve patient outcomes.
Maximum out of pocket
Maximum out of pocket is the highest amount an insured individual is required to pay for covered healthcare services in a given period, excluding premiums.
Measure (indicator) is a quantifiable data point used to assess performance or progress towards a specific goal within healthcare revenue cycle management (RCM).
Medicaid is a government-funded healthcare program in the United States that provides medical assistance to low-income individuals and families.
Medically necessary is a term used to describe healthcare services or procedures that are deemed essential for the diagnosis, treatment, or prevention of a medical condition based on accepted medical standards.
Medically unlikely edit (MUE)
Medically unlikely edit (MUE) is a claim validation tool used in healthcare RCM to identify and prevent payment for medically improbable or excessive services.
Medicare is a federal health insurance program in the United States that provides coverage for individuals aged 65 and older, as well as certain younger individuals with disabilities.
Medicare Advantage (Part C)
Medicare Advantage (Part C) is a government program that offers an alternative to Original Medicare, providing comprehensive health coverage through private insurance plans.
Medicare Claims Processing Manual
The Medicare Claims Processing Manual is a comprehensive guide that outlines the specific rules and procedures for processing Medicare claims.
Medicare Code Editor (MCE)
Medicare Code Editor (MCE) is a software tool used in healthcare revenue cycle management to validate Medicare claims based on coding guidelines.
Medicare Integrity Program
Medicare Integrity Program is a federal initiative that aims to prevent, detect, and combat fraud, waste, and abuse in the Medicare program.
Medicare Part A
Medicare Part A is a federal health insurance program in the United States that covers hospital care, skilled nursing facility care, and some home healthcare services.
Medicare Part B
Medicare Part B is a federal health insurance program that covers outpatient medical services, including doctor visits, preventive care, and medical supplies.
Medicare Part C
Medicare Part C is a health insurance program offered by private companies approved by Medicare, providing Medicare benefits through managed care plans.
Medicare Part D
Medicare Part D is a federal program that provides prescription drug coverage to eligible individuals, helping them afford necessary medications.
Medicare administrative contractor (MAC)
Medicare administrative contractor (MAC) is a private entity contracted by CMS to process Medicare claims, handle provider enrollment, and perform other administrative tasks.
Medicare physician fee schedule (MPFS)
Medicare physician fee schedule (MPFS) is a payment system used by Medicare to determine reimbursement rates for physician services rendered to Medicare beneficiaries.
Medicare severity diagnosis-related group (MS-DRG)
Medicare severity diagnosis-related group (MS-DRG) is a classification system used by Medicare to categorize inpatient hospital stays based on diagnosis, severity, and resource utilization.
Medicare summary notice (MSN)
Medicare summary notice (MSN) is a document that provides a detailed summary of services billed to Medicare beneficiaries, including payments made and any financial responsibility.
Modifier is a two-digit code used in medical billing to provide additional information or clarification about a service or procedure performed by a healthcare provider.
Moral hazard is the risk that individuals or organizations may act recklessly or irresponsibly due to the knowledge that they are protected from the consequences of their actions.
National Center for Health Statistics (NCHS)
National Center for Health Statistics (NCHS) is a federal agency responsible for collecting, analyzing, and disseminating health-related data in the United States.
National correct coding initiative (NCCI)
National Correct Coding Initiative (NCCI) is a Medicare program that promotes correct coding methodologies to prevent improper payment for healthcare services.
National coverage determination (NCD)
National coverage determination (NCD) is a Medicare policy that specifies whether a particular medical service or item is covered and reimbursed by the program.
National health service (Beveridge) model
National health service (Beveridge) model is a healthcare system where the government provides comprehensive medical services to all citizens, funded by taxes.
National unadjusted payment
National unadjusted payment is the predetermined reimbursement rate set by the government for healthcare services rendered, without any modifications or adjustments.
New technology is the latest advancements, tools, or innovations that improve processes, efficiency, or outcomes in healthcare revenue cycle management (RCM).
Nonlabor share is the portion of expenses in healthcare revenue cycle management that excludes labor costs, encompassing all other expenditures.
Nonparticipating physicians (NonPARS)
Nonparticipating physicians (NonPARS) are healthcare providers who do not have an agreement with insurance plans, resulting in higher out-of-pocket costs for patients.
Office of Inspector General (OIG)
Office of Inspector General (OIG) is a federal agency that promotes integrity and efficiency in healthcare programs by preventing fraud, waste, and abuse.
One-sided risk is a situation in healthcare RCM where the financial burden or potential loss is borne solely by one party involved, without any shared responsibility or accountability.
Open enrollment period
Open enrollment period is a designated time frame during which individuals can enroll in or make changes to their healthcare insurance plans.
Other party liability (OPL)
Other party liability (OPL) is the legal responsibility of a third party, such as an insurance company or another entity, to pay for healthcare services rendered to a patient.
Outlier is a data point that significantly deviates from the normal pattern or distribution, often indicating an unusual or exceptional occurrence.
Outpatient Code Editor (OCE)
Outpatient Code Editor (OCE) is a software tool used in healthcare revenue cycle management to ensure accurate coding and billing for outpatient services.
Outpatient service-mix index (SMI)
Outpatient service-mix index (SMI) is a metric that quantifies the composition of outpatient services provided by a healthcare facility.
Packaging is the process of grouping healthcare services or procedures together under a single code for billing and reimbursement purposes.
Partial hospitalization Program (PHP)
Partial Hospitalization Program (PHP) is an intensive outpatient treatment program that provides comprehensive psychiatric care for individuals who require structured therapy but do not need 24-hour inpatient care.
Participating physician (PAR)
Participating physician (PAR) is a healthcare provider who has agreed to accept the payment terms and conditions of a specific insurance plan or network.
Pass-through is a billing arrangement where healthcare providers directly bill payers for specific services or items, bypassing the traditional reimbursement process.
Patient financial responsibility agreement
Patient financial responsibility agreement is a legally binding document that outlines the patient's obligation to pay for healthcare services rendered.
Patient portal is an online platform that allows patients to securely access their medical records, schedule appointments, communicate with healthcare providers, and manage their healthcare information.
Patient registration is the process of collecting and recording essential demographic and insurance information from individuals seeking healthcare services.
Patient-driven payment model (PDPM)
Patient-driven payment model (PDPM) is a reimbursement system implemented in skilled nursing facilities (SNFs) that determines payment based on patient characteristics and care needs.
Payer identifier is a unique alphanumeric code assigned to healthcare payers, such as insurance companies or government programs, for identification and billing purposes.
Payment is the act of transferring funds from a patient or insurance company to a healthcare provider as compensation for services rendered.
Payment status indictor (SI)
Payment status indicator (SI) is a code used in healthcare revenue cycle management to indicate the current payment status of a claim or transaction.
Per member per month (PMPM)
Per member per month (PMPM) is a financial metric used in healthcare revenue cycle management to calculate the average cost or revenue generated per individual enrolled in a health plan within a given month.
Percent of billed charges
Percent of billed charges is the ratio of the total amount billed for healthcare services to the allowed amount determined by payers, expressed as a percentage.
Performance achievement is the successful attainment of predetermined goals or targets, reflecting the ability to meet or exceed desired outcomes.
Performance improvement is the systematic process of enhancing efficiency, productivity, and outcomes within healthcare revenue cycle management (RCM).
Pharmacy benefit manager (PBM)
Pharmacy benefit manager (PBM) is a third-party administrator that manages prescription drug benefits for health insurance plans.
Physician work (WORK) element
Physician work (WORK) element is a quantifiable measure of the time, effort, and skill required by a physician to provide a specific medical service or procedure.
Point-of-service plan is a type of health insurance that allows patients to choose between in-network or out-of-network care at the time of service.
Policy is a set of guidelines and rules established by an organization to govern decision-making and actions, ensuring consistency and compliance.
Policyholder is an individual or entity that holds an insurance policy, entitling them to receive benefits and coverage as outlined in the policy agreement.
Post-acute-care transfer (PACT)
Post-acute-care transfer (PACT) is the process of transferring patients from an acute care setting to a post-acute care facility for continued treatment and recovery.
Practice expense (PE) element
Practice expense (PE) element is the portion of healthcare service cost that encompasses non-physician clinical staff, medical supplies, equipment, and other overhead expenses.
Pre-certification is the process of obtaining approval from a payer before a medical service is provided to ensure coverage and reimbursement.
Price transparency is the clear and accessible disclosure of healthcare service costs, enabling patients to make informed decisions about their care.
Primary care provider (PCP)
Primary care provider (PCP) is a healthcare professional, typically a physician, who serves as a patient's first point of contact for medical care, managing general health concerns and coordinating specialized care if needed.
Primary insurer is the initial insurance company responsible for processing and paying healthcare claims before any secondary or supplemental coverage is considered.
Principal diagnosis is the primary condition or disease identified by a healthcare provider as the main reason for a patient's encounter or hospitalization.
Prior authorization is the process of obtaining approval from a payer before providing healthcare services to ensure reimbursement eligibility.
Private health insurance model
Private health insurance model is a system where individuals or employers purchase insurance plans from private companies to cover their healthcare expenses.
Procedure-to-procedure (PTP) edit
Procedure-to-procedure (PTP) edit is a coding validation tool used in healthcare revenue cycle management to identify and prevent incorrect code combinations.
Program for Evaluating Payment Patterns Electronic Report (PEPPER)
PEPPER is an electronic report generated by CMS that evaluates payment patterns, helping healthcare providers identify potential billing irregularities.
Programs of All-Inclusive Care for the Elderly (PACE)
Programs of All-Inclusive Care for the Elderly (PACE) is a comprehensive healthcare model that provides coordinated medical and social services for eligible elderly individuals.
Proposed rule' is a preliminary regulation or policy suggested by a governing body, subject to public comment and revision before becoming a final rule.
Prospective reimbursement is a payment method in healthcare RCM where predetermined rates are established in advance for specific services or procedures.
Prudent layperson standard
Prudent layperson standard is a legal requirement that healthcare insurers must use when determining coverage, based on whether a reasonable person without medical training would consider the symptoms to be an emergency.
Qualifying life event (QLE)
Qualifying life event (QLE) is a specific circumstance, such as marriage or birth, that allows individuals to make changes to their healthcare coverage outside of the regular enrollment period.
Quality Payment Program (QPP)
Quality Payment Program (QPP) is a Medicare initiative that rewards eligible clinicians for providing high-quality care through two tracks: Merit-based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs).
Quality reporting program
Quality reporting program is a structured initiative that measures and assesses healthcare providers' performance based on predetermined quality measures.
Query is a request for information or clarification, often made by healthcare providers or payers, to resolve discrepancies or obtain additional details related to healthcare revenue cycle management (RCM).
Recovery audit contractor (RAC)
Recovery audit contractor (RAC) is an independent entity hired by the government to identify and recover improper Medicare payments made to healthcare providers.
Referral is the process of directing a patient from one healthcare provider to another for specialized care or additional diagnostic or treatment services.
Reimbursement is the process of compensating healthcare providers for services rendered, typically by insurance companies or government payers.
Relative value unit (RVU)
Relative value unit (RVU) is a standardized measure used in healthcare reimbursement to quantify the complexity and resources required for medical services.
Relative weight (RW)
Relative weight (RW) is a numerical value assigned to each diagnosis-related group (DRG) in healthcare RCM, determining the reimbursement amount for a specific patient's condition.
Remittance advice (RA)
Remittance advice (RA) is a document sent by a healthcare payer to a provider, detailing the payment made for a specific claim.
Resource intensity is the measure of the amount of resources, such as time, labor, and capital, required to complete a specific task or process within healthcare revenue cycle management (RCM).
Resource-based relative value scale (RBRVS)
Resource-based relative value scale (RBRVS) is a payment methodology used to determine reimbursement rates for medical services based on the resources required to provide them.
Retrospective reimbursement is a payment method in healthcare RCM where providers are reimbursed based on the actual costs incurred after services are rendered.
Revenue code is a standardized numerical code used in healthcare billing to identify specific services or procedures provided to a patient for accurate reimbursement.
Revenue cycle is the process of managing financial transactions in healthcare, including patient registration, charge capture, billing, and payment collection.
Risk is the potential for financial loss or negative impact on healthcare revenue cycle management due to uncertain events or circumstances.
Risk adjustment is a statistical process used in healthcare revenue cycle management to account for variations in patient health status and predict future costs.
Risk pool is a mechanism where multiple entities contribute to a shared fund to mitigate financial risks associated with healthcare expenses.
Scrubber is a software tool used in healthcare revenue cycle management (RCM) that automatically detects and corrects errors in medical claims before submission.
Secondary insurer is the second insurance company responsible for covering a portion of the healthcare expenses after the primary insurer has paid its share.
Severity of illness (SOI)
Severity of illness (SOI) is a measure that quantifies the extent of a patient's medical condition, indicating the seriousness and complexity of their illness.
Single coverage is a healthcare insurance plan that provides benefits to only one individual, typically excluding dependents or other family members.
Single path coding
Single path coding is a method in healthcare revenue cycle management where a single code is assigned to represent a specific medical procedure or service.
Single-payer health system
Single-payer health system is a healthcare financing model where a single entity, usually the government, is responsible for paying all healthcare costs for a population.
Skilled nursing facility (SNF)
Skilled nursing facility (SNF) is a healthcare institution that provides specialized nursing care and rehabilitation services to patients who require skilled medical attention and assistance.
Skilled nursing facility value-based purchasing program (SNF VBP)
Skilled nursing facility value-based purchasing program (SNF VBP) is a Medicare initiative that incentivizes quality care by linking payments to performance outcomes in skilled nursing facilities.
Social Security Act
The Social Security Act is a federal law enacted in 1935 that established the Social Security program in the United States, providing benefits to eligible individuals based on their contributions to the system.
Social insurance (Bismarck) model
Social insurance (Bismarck) model is a healthcare financing system where contributions from employers and employees fund universal health coverage for all citizens, ensuring access to medical services.
Soft coding is the practice of using configurable parameters within software systems to enable easy modification and customization without altering the underlying code.
Sole-community hospital is a healthcare facility that serves as the sole provider of inpatient services within a specific geographic area.
Special enrollment period
Special enrollment period is a designated timeframe during which individuals can enroll in or make changes to their healthcare coverage outside of the regular enrollment period.
Summary of Benefits and Coverage (SBC)
Summary of Benefits and Coverage (SBC) is a standardized document that provides clear and concise information about health insurance plan benefits and costs.
Supplemental insurance is additional coverage that individuals can purchase to complement their primary health insurance plan.
TRICARE is a U.S. government healthcare program that provides comprehensive medical coverage for active duty military personnel, retirees, and their dependents.
Third-party payer is an entity, such as an insurance company or government program, that reimburses healthcare providers for services rendered to patients.
Tier is a classification system used in healthcare revenue cycle management (RCM) to categorize accounts based on their level of complexity or value for prioritized processing and resource allocation.
Total performance score (TPS)
Total performance score (TPS) is a metric that quantifies the overall performance of a healthcare revenue cycle management system, providing a comprehensive assessment of its efficiency and effectiveness.
Transfer is the process of moving a patient from one healthcare facility to another, ensuring seamless continuity of care and appropriate billing for services rendered.
Two-sided risk is a payment model where healthcare providers assume financial responsibility for both the cost and quality of care provided to patients.
Unbundling is the process of separating and billing individual components of a medical service or procedure that are typically bundled together.
Universal healthcare coverage
Universal healthcare coverage is a system where all individuals within a specific geographic area have access to healthcare services without financial barriers.
Upcoding is the fraudulent practice of assigning a higher billing code to a medical service or procedure than what was actually provided, resulting in increased reimbursement.
Utilization management is the process of evaluating and controlling the appropriate use of healthcare services to ensure optimal patient care and cost-effectiveness.
Utilization review is a systematic evaluation process that assesses the medical necessity, appropriateness, and efficiency of healthcare services provided to patients.
Value-based purchasing (VBP)
Value-based purchasing (VBP) is a reimbursement model that links payment to the quality and value of healthcare services provided, incentivizing improved patient outcomes and cost efficiency.
Variable day adjustment
Variable day adjustment is the process of modifying the number of days in a healthcare revenue cycle based on specific factors, such as payer requirements or patient circumstances.
Veterans Health Administration (VA)
Veterans Health Administration (VA) is a government agency that provides healthcare services to eligible military veterans in the United States.
Vulnerability is the state of being exposed to potential risks or threats, making an entity susceptible to exploitation or harm.
Wage index is a factor used in healthcare reimbursement calculations that adjusts payment rates based on the labor costs in a specific geographic area.
Waiting period is the duration between the submission of a healthcare claim and the receipt of payment or denial from the insurance company.
Withhold amount is the portion of payment retained by payers to cover potential overpayments or disputed claims until resolution is reached.