Coding and Billing

Coding and Billing Fundamentals: When to Bill Vision Insurance vs. Medical Insurance

By Mark Wright, OD, FCOVD,
and Carole Burns, OD, FCOVD

There are fundamental medical billing and coding concepts that must be understood. In future articles we will build on these concepts by examining coding and billing specific examples, but first we need to start with these basic concepts.

There are differences between vision insurance and medical insurance.

An important example of one of the differences between vision insurance and medical insurance is how often the patient is covered for care. Some vision insurance plans cover the patient once a year, whereas medical insurance permits coverage as many times per year as is medically necessary.

This difference occurs commonly in the practice when the patient presents with a red eye with corneal edema and has both vision insurance and medical insurance. The patient has a $20 co-pay with the vision insurance for today’s examination and a $500 unmet deductible with their medical insurance. The patient wants to use the vision insurance for today’s examination because they only have a $20 co-pay. If they use their medical insurance, they are responsible for the whole examination out-of-pocket because they’ve not yet met their $500 deductible.

There are two issues here that need to be understood. The first issue is financial. If the patient uses their vision insurance for today’s examination, then they forfeit their refractive coverage. They may save some money on today’s examination, however when the patient comes back in a week, they will have to pay out-of-pocket for both the examination and the refraction. In the long run, the patient ends up paying more for both visits by using their vision insurance for today’s visit and the medical insurance for next week’s visit than if the order had been reversed.

The second issue is a rules of engagement argument. Medical insurance should be billed for medical issues. The patient presented with the red eye, which is a medical issue, and, therefore, the medical insurance should be billed for today’s examination.

Medical necessity determines testing
You cannot just run tests on patients because you want to run tests. Medical necessity determines what tests you can run. It is important to understand the definition of medical necessity. Here is CIGNA’s definition of medical necessity.

“Medically Necessary” or “Medical Necessity” shall mean health care services that a Physician, exercising prudent clinical judgment, would provide to a patient for the purpose of evaluating, diagnosing or treating an illness, injury, disease or its symptoms, and that are:

1.    In accordance with the generally accepted standards of medical practice;

2.   Clinically appropriate, in terms of type, frequency, extent, site and duration, and considered effective for the patient’s illness, injury or disease; and

3.    Not primarily for the convenience of the patient or Physician, or other Physician, and not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient’s illness, injury or disease.

For these purposes, “generally accepted standards of medical practice” means:

1.  Standards that are based on credible scientific evidence published in peer-reviewed, medical literature generally recognized by the relevant medical community;

2.   Physician Specialty Society recommendations;

3.   The views of Physicians practicing in the relevant clinical area; and

4.   Any other relevant factors.

Preventive care may be Medically Necessary, but coverage for Medically Necessary preventive care is governed by terms of the applicable Plan Documents.

Note the qualifiers in the definition such as cost and “generally accepted standards of medical practice.” This definition is common to medical insurance companies. It is important to recognize that the insurance company definition of medical necessity is the standard to be followed.

Documentation of testing determines coding
What is documented during the examination is the basis for determining the level of coding which can be billed to the insurance company. The first rule of documentation is “if you didn’t write it down, it never happened.”

There is a good reason for this rule. If for any reason you would not be able to continue care with the patient, another doctor should be able to read your records and continue care where you left off. This is in the patient’s best interests.

The doctor is responsible for coding
Insurance companies audit doctors not the staff. It is an unacceptable defense in an audit for a doctor to say, “I did not know that my staff was billing that way.” The rule is simple, the doctor is responsible for coding. This is why it is important for the doctor to be able to know and appropriately apply coding and billing rules.

Coverage does not mean payment for everything
Just because there is a code doesn’t mean you’ll get paid. Insurance only covers things that have been contractually agreed upon. As an example, there may be coverage for vision therapy for the diagnosis of convergence insufficiency, but not for the diagnosis of convergence excess.

Medical insurance coverage requires a medical reason for the visit
Patients want to know if today’s visit today is going to be covered by their medical insurance before they arrive for the examination. It is unfair to the patient to tell them that they have to wait until after the examination when the final diagnosis is achieved before you can determine whether or not today’s visit is a reimbursable visit.

That is why the reason for the visit (i.e.: the chief complaint) opens or closes the gate for medical reimbursement.

You will be audited
Every third-party employs auditors. It is important for you and the auditor to agree that the codes you submit are appropriate. This happens when you and the auditor interpret codes the same way. This is why annual continuing education in coding and billing is important. Every year there are changes to the codes, therefore, it is important that you keep up with the changes. “Local doctor charged with fraud and abuse” is not a headline that you want to see in your local newspaper about yourself or one of your doctors.`

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