Billing for Medicaid does not have to Be Complicated: Here’s why

Intro

Medicaid is a healthcare program that helps millions of Americans get affordable treatments. So, how does billing for Medicaid work? It is important for healthcare providers to receive accurate and timely payments for the services they provide.

However, Medicaid medical billing can be challenging for providers due to different rules, documentation requirements, and policy updates in each state. If you want to keep your billing process smooth, it would be best to understand the guidelines of these states.

Below is the complete guide that makes it easy for you to understand Medicaid billing. Do you want to start the Medicaid billing process or want to improve your current process? Get your hands on some practical tips and simple strategies so that you can easily reduce errors, improve cash flow, and speed up payments.

Everything About Medicaid

Before we get into how Medicaid billing works, it’s better to know everything about Medicaid. Medicaid is a federal and state (joint) program that gives insurance coverage to those who can’t afford medical care, have limited income, and resources. Medicaid was established in 1965 and helps a range of people, such as:

• Children
• Pregnant ladies
• Disable people
• Low-income families
• People above 60 years old who need long-term care

Medicaid health program covers the following services:

• Hospital stays
• Doctor visits
• Prescription medications
• Long-term care
• Preventive screenings

Other private insurance companies have their own rules and guidelines, and hospital providers have to follow them. On the flip side, Medicaid is managed by a state and has its own federal rules. Hence, coverage, payment rates, and eligibility criteria for Medicaid coverage vary from state to state.

The main goal of Medicaid coverage is to ensure every human being receives necessary medical care despite financial issues.

How Does Medicaid Differ From Medicare?

Although Medicaid and Medicare have many similarities, they still differ in other ways, such as:

Features	Medicaid	Medicare
Patient Eligibility	Medicaid insurance covers low-income individuals, families, disabled persons, children, and pregnant ladies.Each state has its own rules, and hence coverage requirements vary across the states.	Medicare insurance covers people aged 65 or older, young people with permanent disabilities, ALS, and end-stage renal disease.The eligibility criteria aren’t state-specific and don’t depend on low-income people. It is consistent across the country.
Coverage Scope and Services	It covers diverse healthcare services such as:Dental and vision careLong-term carePersonal care assistancePrenatal and maternity services	Medicare covers the following:Outpatient servicesPrescription drugsPhysician visitsHospital careSo, if you take a Medicare coverage plan, you have to take another coverage plan to cover other things such as financial problems or long-term care, etc.
Claim Forms Used	Billing for Medicaid depends on the state. Mostly, CMS-1500 and UB-04 forms are used. Other states may use electronic billing systems or some state-specific forms.	Medicare uses a standardised claim form that is CMS-1500 for professional services and UB-04 for institutional services. Hence, it follows a uniform structure this way.
Payer Hierarchy and Dual Eligibility	Basically, Medicaid plays a secondary role in filling the gaps for low-income patients.It pays the remaining costs when other private insurance plans or Medicare have played their part.	Medicare plays the primary role for qualified patients for multiple insurance programs.It covers their services first and then the remaining costs are covered by other insurance or Medicaid.
Prior Authorization Requirements	Prior authorization is required for services such as diagnostic imaging, specialty care, and prescription drugs.Hence, before you get Medicaid coverage, it needs approval from the state.	Medicare has very few prior authorization requirements.Its main focus is to provide services like repetitive outpatient treatments or durable medical equipment.
Medicaid Reimbursement Billing	Its reimbursement rates are lower than Medicare, and the rates vary by state.Payment levels are specific according to each state, and providers receive less for Medicaid services than Medicare or private insurance.	Medicare Physician Fee means the reimbursement rates are standardized.These rates are not so high but still beneficial, as providers can easily understand the expected reimbursement amounts.
Timely Filing Limits	They differ by state and are shorter. Some states demand claims within 90 or 180 days, while others require for up to 1 year.These deadlines are less predictable.	It has a uniform time limit of 12 months from the date of service. If you submit claims after that period, they get denied.
Appeals Process	The appeal process is different in each state. They have their own systems to handle disputes.	It has a five-level appeal system such as:RedeterminationReconsiderationHearingReviewJudicial reviewProviders can easily apply for step-by-step appeals for denied claims.

As you can see, both coverage programs have their own benefits and limitations. But we suggest that a better program is the one that provides broader eligibility, focuses on income, and gives support financially and emotionally.

Although it is challenging to manage each state’s rules, it can still be a better option in many ways.

Enrollment as a Medicaid Provider

If you want to provide Medicaid services to your patients and get paid in return, the first step is to enroll yourself as a Medicaid Provider. Even though enrollment criteria differ by state, yet most have a similar framework.

We have created a step-by-step guide of what to do during the enrollment process:

Checking Eligibility Requirements:

First things first, you have to check the requirements for Medicaid providers for the state where you are doing work. Even the license, enrollment status, and certifications are different for different providers, such as nurse practitioners, doctors, facilities, or therapists. So, it’s better to check your eligibility before applying.

Register Yourself:

You can register yourself through the online application process. For this, you have to visit the provider enrollment portal of your state or their website. You can also submit your application electronically through the Provider Enrollment Chain and Ownership System (PECOS) if your state allows.

Complete Your Application Process:

Your billing for Medicaid form includes the following:

• Service location
• National Provider Identifier – NPI
• Your practice
• Tax information

You have to provide accurate information; otherwise, delays can happen in application processing due to conflicting information.

Submit Your Documents:

Along with your application, attach other required documentation, such as:

• Licenses
• Evidence of malpractice insurance
• Ownership disclosure
• Certifications
• Background Checks

Medicaid checks your background to make sure you are not a fraud or scammer. It’s done through your site visit before giving approval to your application.

Receive Provider Number:

Once your application is approved, you’ll get your Medicaid Provider ID number. This ID number is crucial to add while submitting claims to get paid.

Enroll in Electronic Claims Submission:

Lastly, sign up for your state’s electronic claims filing system to start billing for Medicaid and the payment process.

Your application process will be smooth if you follow the steps precisely. Once you get enrolled, start billing immediately.

What Documents You Have to Submit?

Each state has its own credential requirements. Here’s a general overview of the documents you have to submit for enrollment, such as:

• Accreditation for specialty services
• Certification documents for facilities
• Ownership details
• Active state medical license
• W-9 form for tax verification
• NPI & TIN
• Fingerprints and background registration documents
• Evidence of malpractice insurance coverage

We recommend that you always double-check the accuracy of your documents if you want to avoid delays.

How to Verify Patient Eligibility in Billing for Medicaid

Confirming a patient’s eligibility is one of the crucial steps in billing for Medicaid. Unfortunately, having a check on eligibility can be challenging as it keeps changing due to state re-evaluations and household income.

Let’s suppose you start giving services to your patients who are not yet verified and approved for Medicaid coverage; it can lead to denied claims and lost revenue. Hence, confirming eligibility can be a good practice, and it ensures that:

• The medical services that a patient gets are covered under the Medicaid plan
• The patient’s coverage is active since the day of service
• Under multiple insurance programs, the correct payer will be billed first
• The provider takes care of compliance and billing errors
• It takes a few minutes to verify eligibility, which can save you from a huge loss.

What are the Methods and Tools to Verify Eligibility?

Each state has its own way to verify eligibility. These methods are as follows:

EHR System: Eligibility is checked automatically during scheduling.

AVR Systems: Automated Voice Response systems are a toll-free phone system used for speedy verification.

State Medicaid Portals: These portals are present on each state’s website. Enter the patient’s name, birthdate, and Medicaid ID number on the portal.

Clearinghouses and Billing Software: You can also hire third-party clearinghouses for real-time verification.

MCO Portals: The Medicaid Managed Care Organization portal is the online portal used to verify if a patient is registered in a managed care plan.

Whatever method you use, try to record everything, including the verification results of a patient, date, and confirmation number.

How Often Do You Check Eligibility?

You can’t verify eligibility one time only. Medicaid coverage changes from month to month; regular checks are a must. Providers must follow the following practices:

Check Before Every Visit: First, you have to check eligibility while booking an appointment, and second, check it on the date of service.

Verify for Recurring Patients: Long-term treatments require frequent checks (monthly).

When Patients Change Plans: Double-check eligibility when a patient wants changes to their insurance plans or personal information.

Before Claim Submission: Always check eligibility before submission that the coverage was active on the first date of service.

Although checking eligibility frequently can be tough, when you make it a part of your routine, it can be easy. It prevents you from denials, reduces claim errors, and ultimately, you get a smooth payment.

Billing for Medicaid and Coding Requirements

While giving your patients Medicaid billing services, keep in mind that Medicaid works at the state level, with each state having its own rules for fee schedules, services, and filing requirements.

Therefore, we must advise you to stay informed about the state’s Medicaid billing rules. These rules are as follows:

• Only enrolled providers can be able to do billing for Medicaid
• Most states require claim submissions electronically through Medicaid Management Information System (MMIS) or Clearinghouse
• According to the Coordination of Benefits (COB) rules, for multiple insurance coverage, Medicaid will pay the last for remaining bills
• The strict filing limit is 90 days to 1 year from the date of service
• Claims must justify each patient’s medical records
• Take approval for some services like specialty care, surgeries, or durable medical equipment

It’s better to keep these rules in mind while performing billing for Medicaid, as it can help you avoid compliance risks.

Medicaid Coding System

For accurate billing, accurate coding is essential. Like other private insurance plans, Medicaid also uses the same national coding system. But still, it uses state-specific modifiers that providers must know.

We have managed to mention the following coding sets that Medicaid uses:

HCPCS: Healthcare Common Procedure Coding System: Used for non-physician services like equipment, ambulance, and supplies.

CPT: Current Procedural Terminology: Used for diagnostic, medical, and surgical procedures.

ICD-10-CM: International Classification of Diseases (10th Revision): Used for coding diagnoses explaining the main reason for the service.

In addition, some modifiers such as 59, 76, and 25 are used to avoid duplicate denials. The thing is to use these codes accurately and without any mistakes. Hence, it’s crucial to train your staff regularly on Medicaid coding updates.

FAQs

When does Medicaid update its billing codes?

Mostly, Medicaid updates its billing codes annually and is effective from 1st January each year. On the other hand, some states provide updates mid-year for some service categories. CMS is effective from 1st January, and ICD-10 from each October.

When do providers get paid for billing for Medicaid?

If the electronic claims are error-free, it will take 14 to 30 days to process those claims.

While paper claims take longer 30-45 days, the MCO has different schedules. You’ll get paid instantly after the claim processing is completed. If your payments get delayed, it means claims are under review.

What happens if Medicaid claims get denied?

If your claim gets denied, review the errors and fix them, and resubmit the claims. But if the denial happened due to authorization or medical necessity issues, appeal them to make it clear.

You can file an appeal within 30-120 days. It’s better to act quickly on denied claims if you want the recovery rate to be better.

What are the key compliance requirements for Medicaid billing?

The following are the compliance requirements:

• Accurate billing and coding
• Proper documentation
• Medical necessity
• HIPAA compliance
• Avoiding conflicts of interest
• Provider enrollment integrity

Can I bill Medicare and Medicaid at the same time?

Yes, you can!

These patients are dual eligible. Medicare primarily pays for the services, and the remaining costs are then covered under the Medicaid program. Medicaid pays for things that Medicare doesn’t cover, such as deductibles and copays.

Conclusion

Billing for Medicaid comes with several key steps. Each step is crucial to proceed further. Want smooth reimbursement and get paid on time? It’s better to do your tasks accurately – verify patient eligibility, provide accurate documents, apply correct codes and modifiers, and submit claims timely.

Medicaid billing can be easy if you check the changing Medicaid rules and updates to perform the process confidently. If you have any questions, please let us know in the comment box below.