PMRP cheat sheet

Revenue cycle spans front-end (scheduling, registration, eligibility), mid-cycle (coding, charge capture, CDI), and back-end (billing, denials, collections, posting); errors at the front end multiply downstream.

Gross/net revenue formula: net patient service revenue = gross charges − contractual allowances − charity care − bad debt − payer denials/adjustments.

Key statutes: False Claims Act (31 U.S.C. §§3729-3733) imposes treble damages plus per-claim penalties for knowingly false claims; Anti-Kickback Statute (42 U.S.C. §1320a-7b) prohibits remuneration for referrals of federally payable items.

Stark Law (42 U.S.C. §1395nn) is a strict-liability civil statute barring physician self-referral for designated health services absent an exception; unlike AKS, no intent element is required.

Civil Monetary Penalties Law and the Exclusion Statute (42 U.S.C. §1320a-7) allow OIG to exclude providers and impose per-item penalties; exclusion means no federal payment for items or services furnished.

HIPAA Privacy Rule permits use/disclosure of PHI for treatment, payment, and health care operations; minimum necessary standard applies to non-TPO uses.

Emergency Medical Treatment and Labor Act (EMTALA) requires a medical screening exam and stabilizing treatment regardless of insurance status; violations carry CMS termination and civil monetary penalties.

Cost report and Medicare reimbursement: inpatient prospective payment uses MS-DRGs; critical access hospitals are cost-reimbursed at 101% of reasonable cost.

Compliance program elements per OIG guidance: written policies, compliance officer/committee, training, hotline, auditing/monitoring, enforcement, and corrective action.

Real-time eligibility (270/271 transaction) should be run at scheduling and again at or before service; verify plan, effective date, copay, deductible remaining, and network status.

Prior authorization must be obtained before service for listed CPT/HCPCS codes; a payer reference number and authorization dates must be documented in the account.

Registration data accuracy rules: verify name spelling, DOB, member ID, and payer ID; demographic mismatch is a leading cause of claim rejection (277CA).

Point-of-service collections: estimate patient responsibility (deductible + coinsurance + copay + non-covered) using a contract-based estimator; collect before or at discharge.

Charity care and financial assistance policy (FAP) under IRS §501(r) must be provided in plain language, translated, and posted; presumptive eligibility may be applied using external screening data.

Medicare Secondary Payer (MSP) questionnaire determines primary payer; failure to bill primary first causes CO-22 denials and rework.

Consent and Advance Beneficiary Notice (ABN) for Medicare non-covered services must be signed before service to shift liability to the patient.

Financial counseling should document income verification, payment plan terms, and any Medicaid/CHIP screening results in the account notes.

ICD-10-CM diagnosis codes have up to 7 characters; ICD-10-PCS procedure codes have 7 characters and are used for inpatient only.

CPT/HCPCS coding requires the highest level of specificity supported by documentation; E/M level selection uses medical decision-making or time per current AMA guidelines.

DRG assignment: MS-DRG is determined by principal diagnosis, secondary diagnoses (CC/MCC), procedures, and discharge disposition; a CC or MCC can shift the DRG and payment significantly.

Present on Admission (POA) indicators (Y/N/U/W/1) affect hospital-acquired condition (HAC) payment reductions and quality reporting.

Charge capture controls: charge master maintenance, charge description master (CDM) review, late-charge reports, and reconciliation of charges to documented services.

Clinical Documentation Integrity (CDI) queries must be non-leading and supported by clinical indicators; physician response time and query outcomes are tracked.

Modifier usage: -25 for significant, separately identifiable E/M with a procedure; -59 or X{EPSU} for distinct procedural services; -26/-TC for professional/technical split.

Coding compliance: annual code updates (Oct 1 ICD-10, Jan 1 CPT), internal audits, and coder credential maintenance (CPC, CCS, RHIT).

Claim lifecycle: 837P/837I submission → payer edit (277CA) → adjudication → 835 remittance (ERA) or paper EOB.

Clean claim rate = claims accepted on first submission ÷ total claims submitted; a leading indicator of front-end and coding quality.

Common rejection codes: CO-16 (missing/invalid information), CO-18 (duplicate claim), CO-97 (benefit included in another service), CO-22 (payment adjusted because another payer is primary).

Claim edits: NCCI (National Correct Coding Initiative) Procedure-to-Procedure (PTP) edits and Medically Unlikely Edits (MUEs) prevent unbundling and overutilization.

Timely filing limits vary by payer and contract; track filing deadlines in the billing system and file within the window or appeal with proof of timely submission.

Coordination of benefits: bill primary, then secondary with the primary EOB/ERA attached; tertiary payers follow the same sequence.

Payer contracts define allowable amounts, fee schedules, and appeal rights; contract modeling compares expected vs. actual reimbursement.

Claim status inquiries use the 276/277 transaction; electronic status checks reduce phone calls and speed follow-up.

Denial categories: registration/eligibility, authorization, coding, medical necessity, timely filing, duplicate, bundling, and non-covered service.

Denial rate = denied claims ÷ total claims submitted; root-cause analysis should separate clinical (medical necessity) from administrative denials.

Appeal levels: first-level (reconsideration), second-level, and external review; each payer has specific forms, deadlines, and documentation requirements.

Medical necessity appeals require clinical documentation, physician letters, and citation of payer policy or InterQual/MCG criteria.

Preventable denials should be routed to front-end or coding teams for process fixes; only true denials are appealed.

Denial write-off policy should require approval thresholds and trend reporting to prevent leakage.

Payer denial codes: CO-50 (not medically necessary), CO-197 (precertification absent), CO-29 (late filing), CO-27 (coverage terminated).

Appeal success rate and average days to resolve are tracked to measure denial management effectiveness.

Days in A/R = (total A/R ÷ total charges) × days in period; a common benchmark is under 35-40 days for hospital A/R.

A/R aging buckets: 0-30, 31-60, 61-90, 91-120, and 120+ days; the 90+ bucket is a key risk indicator.

Clean claim rate and first-pass yield directly influence A/R days; improving first-pass yield reduces rework and A/R.

Collection follow-up: work accounts by dollar value and age; prioritize high-balance, older accounts.

Bad debt vs. charity care: charity care is written off per FAP policy; bad debt is unpaid patient responsibility after collection efforts.

Payment plans and settlement authority must be defined by policy; document all patient communications.

Self-pay A/R should be segmented by propensity to pay and eligibility for financial assistance.

A/R turnover ratio = net revenue ÷ average A/R; higher turnover indicates faster collection.

835 ERA posting: match remittance to claims, post allowed amount, contractual adjustment, patient responsibility, and denial codes.

Cash reconciliation: daily bank deposit must equal posted payments plus adjustments; variances require investigation and documentation.

Underpayment detection: compare posted allowed amount to contracted rate; flag variances for follow-up or appeal.

Revenue integrity: charge capture accuracy, charge master maintenance, and reconciliation of charges to clinical documentation.

Contractual allowance vs. write-off: contractual allowance reflects payer contract; write-off reflects uncollectible or non-covered amounts.

Unapplied cash and credit balances must be resolved within policy timeframes; credit balances are subject to refund and escheatment rules.

Lockbox and EFT enrollment reduce manual posting errors and speed cash application.

Reconciliation reports: payer remittance vs. bank deposit, charge vs. payment, and adjustment reason code analysis.

Key metrics: clean claim rate, denial rate, days in A/R, first-pass yield, net collection rate, cost to collect, and point-of-service collections.

Net collection rate = payments ÷ (charges − contractual adjustments); target is typically 95% or higher.

Cost to collect = total revenue cycle cost ÷ net patient revenue; benchmarks vary by organization size and payer mix.

Dashboard design: align metrics to revenue cycle stages (front-end, mid-cycle, back-end) and report trends, not snapshots.

Data sources: EHR, practice management system, clearinghouse, payer portals, and general ledger; reconcile across systems.

Benchmarking: compare against internal historical performance and external industry benchmarks (e.g., HFMA MAP keys).

Predictive analytics can flag high-risk claims (denial likelihood) before submission to prioritize work.

Reporting cadence: daily (cash, denials), weekly (A/R aging), monthly (financial close), quarterly (payer performance).

HIPAA Security Rule requires administrative, physical, and technical safeguards for ePHI; risk analysis is mandatory.

Breach notification: notify affected individuals within 60 days of discovery; HHS notification required for breaches affecting 500+ individuals.

HL7 v2 and FHIR are the primary interoperability standards; X12 837/835/270/271 handle claims and eligibility.

Role-based access control (RBAC) and audit logging are required to protect PHI and meet minimum necessary standards.

Encryption at rest and in transit is an addressable safeguard under HIPAA; lack of encryption can trigger breach reporting.

Business Associate Agreements (BAAs) are required with vendors that handle PHI.

System downtime procedures must include paper backup and reconciliation after restoration.

Interoperability: health information exchange (HIE) and APIs (e.g., FHIR-based patient access APIs under the Cures Act) support data sharing and patient access.