AAPC-COC Certified Outpatient Coder - Set 3 - Part 2

Correct Answer: Supplies from a hospital supply room

A diagnostic service is an examination or procedure that obtains information to aid in assessing a medical condition or identifying a disease. Supplies alone are not services and do not meet that definition. Option a is incorrect because these studies appear in the manual's list of examinations and tests, given to determine the nature and severity of an ailment or injury. Option b is incorrect because hematology is listed as a diagnostic laboratory service, alongside chemistry, because it examines materials derived from a hospital outpatient to aid in identifying disease. Option c is incorrect because the manual names diagnostic x-rays among the examinations performed to obtain information that aids in assessing a medical condition, so they qualify as diagnostic.

Correct Answer: A registered outpatient, not admitted as an inpatient, who receives hospital services

The Medicare manual defines a hospital outpatient as a person not admitted by the hospital as an inpatient, registered on the hospital records as an outpatient, and receiving services, rather than supplies alone, from the hospital. Option b is incorrect because when personnel not employed or arranged for by the hospital take the specimen, the patient receives no direct hospital service. Option c is incorrect because an admitted inpatient falls outside the definition, which requires a person who has not been admitted by the hospital as an inpatient. Option d is incorrect because supplies from a hospital supply room used for private patients do not make those patients outpatients of the hospital.

Correct Answer: Compromise

A compromise, under the Federal Claims Collection Act in an MSP situation, is the Regional Office's acceptance of less than the full debt owed to Medicare. An individual who accepts it has no right to appeal the remaining debt. Option a is incorrect because it is a decision to relinquish collection of part of a debt, arising under section 1870(c) of the Act rather than from negotiation or offer. Option b is incorrect because this describes a plan that takes into account eligibility for Medicare based on working aged or disability status, such as failing to pay primary benefits. Option c is incorrect because it names the amount determined to be owed to Medicare: the lesser of the settlements, judgments or awards, or the amount Medicare paid, less procurement costs.

Correct Answer: the usual Part B coverage and payment rules

The Medicare manual states that ASCs may be paid under other parts of Medicare Part B for certain services that are not ASC facility services, and the usual Part B coverage and payment rules apply to them. Option a is incorrect because those criteria decide which surgical procedures qualify for facility-service payment under the ASC subpart, so they do not govern services outside the ASC services category. Option b is incorrect because the ASC subpart sets payment for ASC services, meaning facility services and covered ancillary services furnished with a covered surgical procedure, which excludes non-ASC services. Option d is incorrect because that comparison is a specific payment rule within the ASC regulation, while Medicare guidance for non-ASC services points to the usual Part B rules instead.

Correct Answer: Governing body and management

The condition for coverage on governing body and management includes a hospitalization standard. The ASC must have an effective procedure for immediate transfer to a hospital of patients requiring emergency care beyond its capabilities. Option a is incorrect because it describes services paid under usual Part B rules outside ASC facility services and sets no emergency transfer requirement for the ASC. Option b is incorrect because it only requires the ASC to comply with State licensure requirements and contains no patient transfer procedure. Option c is incorrect because it addresses when CMS permits a new agreement after it terminated one, not how emergency patients are moved to a hospital.

Correct Answer: Costs treated as a non-reimbursable cost center

A hospital-operated facility electing ASC status must be physically, administratively, and financially independent and distinct from other hospital operations, with ASC costs treated as a non-reimbursable cost center on the hospital's cost report. Option a is incorrect because a hospital-operated ASC participates and is paid only as an ASC, so it receives the ASC payment amount instead. Option b is incorrect because that certification path applies to a provider-based department of the hospital, not to a facility electing to participate as an ASC. Option d is incorrect because merging costs with hospital operations conflicts with the requirement that an ASC be financially independent and distinct from other hospital operations.

Correct Answer: facility services

The statute provides Part B coverage of facility services furnished in connection with surgical procedures the Secretary specifies, and it sets the amounts paid for those facility services when the procedures are performed in an ASC. Option a is incorrect because the statute ties ASC payment to surgical procedures the Secretary specifies, and the list shows which procedures are covered and paid in the ASC setting. Option b is incorrect because these are services an ASC may furnish that are not ASC facility services, and the usual Part B coverage and payment rules apply to them. Option c is incorrect because the ASC covered procedures list does not require covered surgical procedures to be performed only in ASCs, so no such restricted category defines the payment basis.

Correct Answer: I and II

The agreement requires the ASC to accept assignment for facility services tied to covered surgical procedures, and a hospital-operated ASC's agreement becomes effective on the first day of the hospital's next cost reporting period. Statements I and II are accurate. Option b is incorrect because statement III is wrong, since a hospital-operated ASC participates and is paid only as an ASC, not as a hospital department. Option c is incorrect because statement IV fails because ASCs may be paid under other parts of Part B for non-ASC services, and the usual Part B rules apply to them. Option d is incorrect because both statements are inaccurate, and this pairing leaves out the assignment requirement and the cost reporting period effective date, which are accurate.

Correct Answer: Primary payment

In the MSP context, primary payment means payment by a primary payer for services that are also covered under Medicare. It is made, or reasonably expected to be made, by the entity holding primary payment responsibility. Option a is incorrect because payment in full is the amount a provider must accept or voluntarily accepts as full satisfaction of the patient's obligation, which is a narrower concept. Option c is incorrect because a partial waiver is a Medicare decision under section 1870(c) to relinquish collection of part of a debt, not a payment for a service. Option d is incorrect because a Workers' Compensation Medicare Set-Aside Arrangement protects Medicare's interests in settlements that allocate funds for future medical expenses, rather than describing a payment already made.

Correct Answer: Medicare does not determine primacy between the two primary payers.

Under the Medicare Secondary Payer provisions, all payers primary to Medicare are expected to pay before Medicare. When several are primary for the same item or service, Medicare does not determine primacy among them. Option a is incorrect because when Medicare is the secondary payer, every payer primary to Medicare is expected to pay before Medicare does, so Medicare does not pay first. Option b is incorrect because Medicare guidance leaves that ranking undone; Medicare takes no part in deciding order when multiple payers are primary for a given item or service. Option c is incorrect because the guidance says the beneficiary generally is not disadvantaged, since combined primary and Medicare secondary payment equals or exceeds combined payment when Medicare is primary.

Correct Answer: Coordination Period

The Coordination Period is the 30-month span in which Medicare benefits are secondary to benefits payable under GHPs for individuals who are eligible for Medicare because of ESRD. Option b is incorrect because it names a Medicare payment made on condition of reimbursement when another insurer is the primary payer, not a timed period tied to ESRD. Option c is incorrect because it describes an individual who is actively working or meets defined conditions such as receiving employer disability benefits, and it sets no 30-month period. Option d is incorrect because it is the provision making Medicare secondary for beneficiaries age 65 or older covered under a GHP through their own or a spouse's current employment status.

Correct Answer: It arises from negotiation or offer

A partial waiver does not arise from negotiation or offer. It comes under section 1870(c) of the Act, based on factual data. Negotiated resolution describes a compromise, which is a different concept. Option a is incorrect because section 1870(c) of the Act gives the beneficiary the right to request a waiver, so this is a genuine feature of a partial waiver. Option b is incorrect because Medicare holds the authority to grant or deny the waiver, and that decision rests on factual data, which makes this a real feature. Option d is incorrect because an individual may appeal a section 1870(c) determination that grants only a partial waiver of the debt, so the appeal right belongs to this term.

Correct Answer: The group health plan

Under the working aged provision, Medicare benefits are secondary to GHP benefits for individuals age 65 or over with Part A whose GHP coverage stems from their own or a spouse's current employment with an employer of 20 or more employees. Option a is incorrect because the guidance sets a payment order in which the primary payer processes the claim first, and it describes no equal-share arrangement between the two. Option b is incorrect because primacy follows the MSP rules, not the order of receipt; the claim must first be submitted to the primary payer, which is the GHP. Option c is incorrect because the working aged provision makes Medicare benefits secondary to benefits payable under the GHP when coverage comes through current employment, so this reverses the order.

Correct Answer: At least 100 employees

Under the basic prohibitions at 42 CFR 411.102, a group health plan of an employer or employee organization of at least 100 employees may not take into account disability-based Medicare entitlement of an individual covered by current employment status. Option b is incorrect because is the size threshold the regulation sets for the age-based prohibition, not for the disability-based prohibition that applies to larger plans. Option c is incorrect because describes the ESRD prohibition, which applies to a group health plan of any size, whereas the disability rule has a minimum employee count. Option d is incorrect because is not a threshold the regulation uses for the disability, age or ESRD prohibitions on taking Medicare entitlement into account.

Correct Answer: Mistaken payment

Medicare is secondary to WC plans. If Medicare paid for items or services that can be or could have been paid under WC, the Medicare payment constitutes a mistaken payment under the MSP provisions. Option a is incorrect because this term describes a compensation award intended to cover all future medical expenses, not the classification of a Medicare payment that WC could have covered. Option b is incorrect because a conditional payment is made when the WC carrier is not expected to pay promptly or the claim is denied, which is a different circumstance. Option d is incorrect because a set-aside arrangement is an arrangement tied to WC settlements, not the label given to Medicare's payment for items WC could have paid.

Correct Answer: As self-insured for liability purposes

An entity that engages in a business, trade, or profession is considered self-insured for liability purposes to the extent it has not purchased liability insurance. Liability insurance includes self-insurance, so Medicare is secondary. Option b is incorrect because no-fault insurance pays medical expenses regardless of who caused the accident, whereas this business is answerable for alleged legal liability for the injury. Option c is incorrect because a group health plan is employer-sponsored health coverage, which is not what a business without liability insurance provides when it answers for an injury it caused. Option d is incorrect because a workers' compensation law or plan is a separate type of primary plan, and a business without liability insurance is not described as one.

Correct Answer: Automobile medical payments coverage

MedPay, or automobile medical payments coverage, is a form of no-fault insurance even when included in automobile insurance of any type. It pays regardless of fault, so it is not liability insurance under the MSP provisions. Option a is incorrect because the manual cites it as an example of liability insurance, and Medicare is secondary to it just as with other liability coverage. Option c is incorrect because CMS manual guidance names it directly among the forms included in liability insurance, since it pays based on the policyholder's alleged legal liability. Option d is incorrect because it appears in the manual's list of liability insurance types, which covers payment tied to alleged legal liability for injury or damage.

Correct Answer: Federal law making Medicare secondary payer to certain GHPs

Federal law that makes Medicare secondary payer to certain GHPs controls. Medicare is secondary to GHP coverage based on current employment and primary to retiree GHP coverage, regardless of any coordination of benefits arrangement between the plans. Option a is incorrect because Medicare is primary to retirement-based GHP coverage no matter what the plans arrange between themselves, so the retiree contract carries no controlling weight. Option b is incorrect because private coordination of benefits agreements cannot supersede Federal law, so the plans' own ordering does not decide where Medicare stands. Option d is incorrect because COB arrangements based on State law are specifically described as unable to override the Federal law that fixes Medicare's position as secondary payer to certain GHPs.

Correct Answer: Provider is obligated to accept primary payment as full satisfaction

Medicare will not make a secondary payment if the provider, physician, or supplier accepts, or is obligated to accept, the primary plan payment as full payment or full satisfaction of the patient's responsibility. Option a is incorrect because the manual lets a provider, physician, other supplier, or beneficiary submit a claim, so the submitter alone does not block secondary payment. Option c is incorrect because a shortfall against the gross Medicare amount supports secondary payment, provided the provider is not obligated to accept the primary payment as full payment. Option d is incorrect because a primary payment lower than the charges is exactly the situation in which A/B MACs and DME MACs can process a secondary payment.

Correct Answer: The days are not counted against available Part A days

Under 42 CFR 411.30(a), inpatient psychiatric hospital and SNF care paid for by a primary payer is not counted against the number of inpatient care days available to the beneficiary under Medicare Part A. Option a is incorrect because the regulation sets no partial split of days; care paid by a primary payer is treated uniformly, not proportionally. Option b is incorrect because federal regulation gives primary-paid psychiatric and SNF care no such charge; counting those days would erode benefits Medicare never paid for. Option c is incorrect because deductible credit is a separate rule covering expenses paid by primary payers; it does not turn inpatient days into anything else.