This document provides a reference for the core concepts and terminology used in the ScoutIQ Insurance Revenue Cycle Management (RCM) system.
- Definition: A legal arrangement where the patient requests that their insurance company pay the healthcare provider (the practice) directly.
- Why it matters: Without an AOB, the payer may send the check to the patient instead of the office, forcing the office to chase the patient for payment.
- Definition: The process of determining which insurance pays first when a patient is covered by multiple plans (e.g., their own job and their spouse's job).
- Primary Insurance: Pays first according to its plan limits.
- Secondary Insurance: May cover the remaining balance (deductibles, coinsurance) left by the primary.
- Impact: Affects claim routing, expected reimbursement, and how denials are interpreted.
¶ 2. Electronic Data Interchange (EDI) Standards
- The "Bill": The electronic file sent by the practice to the insurance company saying, "Here is what we did, please pay us."
- The "Explanation": The electronic version of an EOB. It tells the practice exactly what happened to the claim.
- Contents: Paid amounts, adjustments, denials, and patient responsibility.
- 999 (Implementation Acknowledgement): A "receipt" confirming the 837 file was structurally valid EDI.
- 277CA (Claim Acknowledgement): A more detailed "status report" confirming the claim was accepted into the payer's system for processing.
- The "Cash": The actual movement of money from the payer's bank to the practice's bank.
- Definition: A unique ID assigned to an EFT by the payer’s bank.
- Reconciliation: This number appears in both the ERA (835) and the Bank Feed (ACH record). It is the primary way ScoutIQ automatically matches "what they said they paid" to "the money in the bank."
- Definition: Extra text attached to an ACH payment.
- Usage: Often contains claim numbers or payer names that help identify payments when a trace number is missing or ambiguous.
The process of verifying three data points before "closing" a transaction:
- ERA/EOB: What the insurance says they paid.
- Bank Deposit: Confirmation that the cash actually arrived.
- PMS Claim: The original record in the Practice Management System.
- Goal: Ensures every posted payment is backed by real cash.
- Definition: The internal review of an insurance payment to decide the next action.
- Actions:
- Accept: Payment matches expectations.
- Appeal: Underpayment or incorrect denial.
- Write-off: Contractual adjustment (e.g., PPO discount).
- Transfer: Move balance to the patient or secondary insurance.
- CARC (Claim Adjustment Reason Codes): Standard codes explaining why a payment differs from the original charge (e.g., Code 1: "Deductible").
- RARC (Remittance Advice Remark Codes): Supplemental codes providing more specific detail (e.g., "Missing X-ray").
- Definition: The automated or manual process of recording the insurance payment and adjustments back into the Practice Management System (e.g., Dentrix, Eaglesoft) via Sikka.
- Definition: The final accounting step where reconciled payment data is sent to the financial system (e.g., QuickBooks, NetSuite) to update the company's financial statements.