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Medical Billing Terms: L through R

By GinaUpdated 7 min read

Medical Billing Terminology L thru R commonly used by medical billing specialists and medical coders.

A – E F – K S – Z

M

MAC
Medicare Administrative Contractor.
Managed Care Plan
Insurance plan requiring patient to see doctors and hospitals that are contracted with the managed care insurance company. Medical emergencies or urgent care are exceptions when out of the managed care plan service area.
Maximum Out of Pocket
The maximum amount the insured is responsible for paying for eligible health plan expenses. When this maximum limit is reached, the insurance typically then pays 100% of eligible expenses.

Meaningful Use – A provision of the 2009 HITECH act that provides stimulus money to providers who implement Electronic Health Records (EHR). Providers who implement EHR must show “Meaningful Use” and meet certain requirements defined in the act. The incentive is $63,750 over 6 years for Medicaid and $44,000 over 5 years for Medicare. Providers who do not implement EHR by 2015 are penalized 1% of Medicare payments increasing to 3% over 3 years.

Medical Assistant
A health care worker who performs administrative and clinical duties in support of a licensed health care provider such as a physician, physicians assistant, nurse, nurse practitioner, etc.
Medical Coder
Analyzes patient charts and assigns the appropriate code. These codes are derived from ICD-9 codes (soon to be ICD-10) and corresponding CPT treatment codes and any related CPT modifiers.
Medical Billing Specialist
Processes insurance claims for payment of services performed by a physician or other health care provider. Ensures patient medical billing codes, diagnosis, and insurance information are entered correctly and submitted to insurance payer. Enters insurance payment information and processes patient statements and payments. Performs tasks vital to the financial operation of a practice. Knowledgeable in medical billing terminology.
Medical Necessity
Medical service or procedure that is performed on for treatment of an illness or injury that is not considered investigational, cosmetic, or experimental.
Medical Record Number
A unique number assigned by the provider or health care facility to identify the patient medical record.
MSP
Medicare Secondary Payer.
Medical Savings Account
Tax exempt account for paying medical expenses administered by a third party to reimburse a patient for eligible health care expenses. Typically provided by employer where the employee contributes regularly to the account before taxes and submits claims or receipts for reimbursement. Sometimes also referred to in medical billing terminology as a Medical Spending Account.
Medical Transcription
The conversion of voice recorded or hand written medical information dictated by health care professionals (such as physicians) into text format records. These records can be either electronic or paper.
Medicare
Insurance provided by federal government for people over 65 or people under 65 with certain restrictions. There are 2 parts:
Medicare Coinsurance Days
Medical billing terminology for inpatient hospital coverage from day 61 to day 90 of a continuous hospitalization. The patient is responsible for paying for part of the costs during those days. After the 90th day, the patient enters “Lifetime Reserve Days.”
Medicare Donut Hole
The gap or difference between the initial limits of insurance and the catastrophic Medicare Part D coverage limits for prescription drugs.
Medicaid
Insurance coverage for low income patients. Funded by Federal and state government and administered by states.
Medigap
Medicare supplemental health insurance for Medicare beneficiaries which may include payment of Medicare deductibles, co-insurance and balance bills, or other services not covered by Medicare.
Modifier
Modifier to a CPT treatment code that provide additional information to insurance payers for procedures or services that have been altered or “modified” in some way. Modifiers are important to explain additional procedures and obtain reimbursement for them.

N

N/C
Non-Covered Charge. A procedure not covered by the patients health insurance plan.
NEC
Not Elsewhere Classifiable. Medical billing terminology used in ICD when information needed to code the term in a more specific category is not available.
Network Provider
Health care provider who is contracted with an insurance provider to provide care at a negotiated cost.
Nonparticipation
When a healthcare provider chooses not to accept Medicare-approved payment amounts as payment in full.
NOS
Not Otherwise Specified. Used in ICD for unspecified diagnosis.
NPI Number
National Provider Identifier. A unique 10 digit identification number required by HIPAA and assigned through theNational Plan and Provider Enumeration System (NPPES).

O

OIG
Office of Inspector General – Part of department of Health and Human Services. Establish compliance requirements to combat healthcare fraud and abuse. Has guidelines for billing services and individual and small group physician practices.
Out-of Network (or Non-Participating)
A provider that does not have a contract with the insurance carrier. Patients usually responsible for a greater portion of the charges or may have to pay all the charges for using an out-of network provider.
Out-Of-Pocket Maximum
The maximum amount the patient has to pay under their insurance policy. Anything above this limit is the insurers obligation. These Out-of-pocket maximums can apply to all coverage or to a specific benefit category such as prescriptions.
Outpatient
Typically treatment in a physicians office, clinic, or day surgery facility lasting less than one day.

P

Palmetto GBA
An administrator of Medicare health insurance for the Centers for Medicare & Medicaid Services (CMS) in the US and its territories. A wholly owned subsidiary of BlueCross BlueShield of South Carolina based in Columbia, South Carolina.
Patient Responsibility
The amount a patient is responsible for paying that is not covered by the insurance plan.
PCP
Primary Care Physician – Usually the physician who provides initial care and coordinates additional care if necessary.
POS
Point-of-Service plan. Medical billing terminology for a flexible type of HMO (Health Maintenance Organization) plan where patients have the freedom to use (or self-refer to) non-HMO network providers. When a non-HMO specialist is seen without referral from the Primary Care Physician (self-referral), they have to pay a higher deductible and a percentage of the coinsurance.
POS (Used on Claims)
Place of Service. Medical billing terminology used on medical insurance claims – such as the CMS 1500 block 24B. A two digit code which defines where the procedure was performed. For example 11 is for the doctors office, 12 is for home, 21 is for inpatient hospital, etc.
PPO
Preferred Provider Organization. Commercial insurance plan where the patient can use any doctor or hospital within the network. Similar to an HMO.
Practice Management Software
software used for the daily operations of a providers office. Typically used for appointment scheduling and billing.
Preauthorization
Requirement of insurance plan for primary care doctor to notify the patient insurance carrier of certain medical procedures (such as outpatient surgery) for those procedures to be considered a covered expense.
Pre-Certification
Sometimes required by the patients insurance company to determine medical necessity for the services proposed or rendered. This doesn’t guarantee the benefits will be paid.
Predetermination
Maximum payment insurance will pay towards surgery, consultation, or other medical care – determined before treatment.
Pre-existing Condition (PEC)
A medical condition that has been diagnosed or treated within a certain specified period of time just before the patients effective date of coverage. A Pre-existing condition may not be covered for a determined amount of time as defined in the insurance terms of coverage (typically 6 to 12 months).
Pre-existing Condition Exclusion
When insurance coverage is denied for the insured when a pre-existing medical condition existed when the health plan coverage became effective.
Premium
The amount the insured or their employer pays (usually monthly) to the health insurance company for coverage.
Privacy Rule
The HIPAA privacy standard establishes requirements for disclosing what the HIPAA privacy law calls Protected Health Information (PHI). PHI is any information on a patient about the status of their health, treatment, or payments.
Protected Health Information (PHI)
An individuals identifying information such as name, address, birth date, Social Security Number, telephone numbers, insurance ID numbers, or information pertaining to healthcare diagnosis or treatment.
Provider
Physician or medical care facility (hospital) who provides health care services.
PTAN
Provider Transaction Access Number. Also known as the legacy Medicare number.

R

Referral
When one provider (usually a family doctor) refers a patient to another provider (typically a specialist).
Remittance Advice (R/A)
A document supplied by the insurance payer with information on claims submitted for payment. Contains explanations for rejected or denied claims. Also referred to as an EOB (Explanation of Benefits).
Responsible Party
The person responsible for paying a patients medical bill. Also referred to as the guarantor.
Revenue Code
Medical billing terminology for a 3-digit number used on hospital bills to tell the insurer where the patient was when they received treatment, or what type of item a patient received.
RVU
Relative Value Amount. This is the average amount Medicare will pay a provider or hospital for a procedure (CPT-4). This amount varies depending on geographic location.

A – E F – K S – Z

Medical Billing Terminology L thru R

Medical Billing Terminology