12. We will now focus on the columns used to apply the payments and adjustments as listed on the EOB.

Payment: In the payment column, enter the actual amount paid by the insurance carrier. An entry here will cause a payment type transaction to be entered into the patients ledger in the amount entered.

Deductible: If a charge or portion of a charge was applied to the patient deductible, it will be listed on the EOB. Enter that amount here. The balance on the charge will not be affected by this amount.

Withhold: If the EOB states that an amount was withheld from the payment for this patient’s visit, enter that amount in this field. The most common use of this is when the insurance carrier had previously overpaid on this or another patient’s account. This will lower the balance on the charge by the amount entered.

Allowed: Allowed amounts are the amounts the insurance carriers will base their payments on. This field will automatically populate with the allowed amount entered for this combination of procedure code and insurance carrier. These values can be entered through either the procedure code entry screen or the insurance carrier entry screen. If the value defaulting in this field is 0, you can enter the allowed amount in the column on this screen, and it will automatically update the value in the procedure code and insurance carrier setup screens. Additionally, for the purposes of this particular payment application, you can change the value that is defaulting in this field and have it affect that transaction only.

Adjustment: The adjustment field is normally used to enter the disallowed amount adjustments. If you have entered your allowed amounts properly, this field CAN automatically calculate the adjustment amount for you. In order for this to happen, you must first make a selection within Program Options. On the Payment Application tab, place a check mark in the field labeled Calculate Disallowed Adjustment Amounts.

Takeback: If the EOB states that an amount was withheld for a previous overpayment, it will also indicate the patient who was overpaid. The Takeback column is used to take the money back from the previously overpaid patient. This will increase the balance on the charge by the amount entered.

Complete: The complete field is the most important field on this screen. This field is indicating that the payment from this insurance carrier is complete and that no more money is expected from the insurance carrier. If you will be appealing the amount, do not place a check mark in this field. If you do not expect any more payment on that line item, place a check mark. The check mark indicates that the aging and billing should move on to the next responsible party. You can automatically check insurance payments as complete by selecting the program option on the Payment Application tab labeled Mark Paid Charges Complete. This field will only be available if your deposit type was set to Insurance.

Rejection: The rejection field is used to create notes that will appear on a patient’s statement indicating the reason the charge was not paid by the insurance carrier. This is included on this screen because the EOB will indicate the reason it was not paid, and this is the screen used to enter the EOB. These messages must be set up prior to payment application. This is done through the Lists menu and Claim Rejection Messages. New Rejection Messages can also be added from the Deposit List by right clicking in the rejection area and select New Rejection Code (F8) or Edit Rejection Code (F9).

  1. Provider: You will not be able to edit the value in the Provider field. This simply indicates the attending provider, or provider who performed the medical services.
  2. Once you have entered all applicable values for this patient, click the button labeled Save Payments/Adjustments. At this point you will create up to 5 types of transactions in the patient’s ledger. This process will also update your mwtrn.adt and mwpax.adt files. At this point, these transactions will appear on your accounting reports.


  3. Change the chart number field to the next patient on the EOB, and repeat this process for each subsequent patient until the entire amount has been applied.

Following this process will allow you to quickly enter 5 different types of insurance transactions for multiple patients.

NOTE: This feature is only available on Medisoft Advanced and Medisoft Network Professional.

 

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  1. The fields labeled Payment Code, Adjustment Code, Withhold Code, Deductible Code, and Takeback Code. These codes represent the 5 types of transactions that can be entered into a patient’s ledger through the deposit list. These codes MUST be entered prior to applying the payment. You can set up default codes to be used for payments from each insurance carrier. This is done on the Options and Codes tab of the insurance carrier setup screen.


  2. Click Save. At this point you have updated the mwdep.adt table, but have not yet updated the mwtrn.adt or mwpax.adt tables.
  3. You will now see the payment listed on the main page of the deposit list. Highlight it and click Apply.


Tips and Tricks:

If you see EOB Only in the amount column, that indicates that there was not an actual payment made, and that the EOB indicates the reason payment was not made.

  1. You will see the following screen. In the For field enter the chart number for the first patient listed on your EOB. Any charges that have not yet been paid by that insurance carrier will be displayed. If there are charges on the patient ledger that do not appear on this screen, you may want to try unchecking the field labeled Show Unpaid Only.


  1. The first step is to locate the charges that were paid and to which you need to apply the payment. The EOB should list the date of service, the procedure code, and the amount billed. These fields are available to you on the left side of the window. You will need to find the charges using these fields. Additionally, you will see the balance remaining on each charge in the column labeled Remainder.


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Transaction Entry

During the recent blog posts discussing the Transaction Entry interface, we discussed the process used for entering payments and adjustments through the Transaction Entry screen. This process must be followed for entering insurance EOBs as well.

It is important to note that when entering payments through transaction entry, you will only have access to one patient and case at a time. This means that you will need to break out the EOB into multiple payments in order to apply it to each patient. Additionally, you will need to manually create each type of necessary adjustment.

If you are using Medisoft Original, you have no choice but to enter your payments through Transaction Entry.

Quick Ledger

(Please Note: The Quick Ledger is a feature only available in Medisoft Advanced and Medisoft Network Professional.)

Medisoft has the ability to change the current responsibility for a charge through the Quick Ledger. When doing this, you can only use the Quick Ledger to move the responsibility to a subsequent party. An example of this would be to move the responsibility from the primary insurance carrier to the guarantor. When using this feature, the program will automatically enter a payment with a 0 amount and mark it complete. This will effectively move the balance to the designated party.

This is done by simply right-clicking on a charge, clicking Responsibility, and then selecting the party you want to make responsible for a charge.

Tips and Tricks:

Insurance carriers will not be listed as the responsible party until a claim has been billed to them. Until the primary carrier has been billed, the responsibility will be listed as Patient Responsible.

If you want to undo this process, you will not be able to simply right-click and change it back.

The only way to undo this process is to open Transaction Entry to the screen including the payment that was created. You should then highlight the payment and click Apply. You will then have the opportunity to remove the Complete checkmark. This will take the responsibility back for that payor. If you have multiple 0 payments that were created, you will need to repeat this process for each carrier’s payment. If you wish, you can then delete the 0 payments. It is IMPERATIVE that you uncheck the Complete box PRIOR to deleting the payment.

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Insurance Payments

To enter an insurance payment from an EOB, take the following steps from within the Deposit List.

  1. Click the New button.


  2. The following screen will appear.


  3. The Deposit Date field specifies the date of payment and adjustment that will be listed in the patient ledgers. This date will default to the computer’s system date. You can manually change this date in order to enter payments that were received on previous dates.
  4. The Payor Type field will default to Insurance. This is the value you want here for a non-capitation insurance payment.
  5. Enter the entire amount listed on the check in the field labeled Payment Amount.
  6. In the field labeled Insurance, enter the insurance code for the carrier making the payment.
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Deposit List Automation Options

When entering payments through the deposit list, there are automated features which allow you to better navigate the billing and collections process. We will examine those features here. These fields are available on the payment application screen.

Alert When Claims Are Done: If you apply COMPLETE insurance payments to all charges that are on the same claim in Claim Management, that claim will be automatically marked as done. If this field is checked you will be notified when the claim is marked done.

Alert When Statements Are Done: If you apply payments that bring all charges on a statement to a zero balance that statement will be marked as done. If this field is checked, you will be notified when the statement is marked done.

Bill Remaining Insurances Now: If you apply COMPLETE insurance payments to all charges that are on the same claim in Claim Management, this feature will cause Medisoft to bill the next responsible insurance carrier automatically.

Print Statement Now: After receiving insurance payments, the next step in the billing process is usually to print patient statements. If this field is checked, the patient statement will print after clicking Save Payments/Adjustments.

Write off Balance Now: Medisoft has the ability to do small balance write-offs. This allows you to write off balances that are too small to be worth collecting. In order for this option to be available, you must have your program options configured in advance. On the Payment Application tab in the Program Options screen, you will see a section labeled Small Balance Write-Off. You must have an adjustment code entered in the field labeled Patient Write-off Code and the maximum amount you wish to be written off in the field labeled Maximum Write-off Amount.

If the Write off Balance Now is checked, the current payments and/or adjustments are created and applied, prior to recalculating the Patient Remainder Balance. After the Patient Remainder Balance is recalculated for the patient listed in the For box, the Patient Remainder Balance is compared with the Maximum Write-off Amount that was entered in Program options. If the write-off conditions are met, then the write-off adjustment is created and applied to this patient’s ledger.

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Deposit List

The Deposit List is a feature that is only available in Medisoft Advanced and Medisoft Network Professional. This feature will allow you to quickly apply an EOB to multiple patients. It will also track payments that have been entered into Transaction Entry. Any payments entered into Transaction Entry will be automatically entered into the Deposit List and will be listed in the Deposit List as applied payments.

Navigation of the Deposit List

Prior to utilizing the Deposit List, it is important to know the different functions it can perform.

It is important to note that items entered into the Deposit List WILL NOT affect accounts receivable totals until they have been applied to specific charges. This is important to note because it has implications on reports. Reports based on the Deposit List will not match reports based on the Transaction Entry file. This is because the accounting reports are based on the mwtrn.adt table. The Deposit List does not update this table until payments have been applied.

When you first open the Deposit List, you will see the following screen:

We will now discuss some of the fields available to you and explain what they are used for.

Deposit Date: When you first open the deposit list, the Deposit Date field in the upper left corner of the screen will default to the system date. Selecting a date in this field will allow you to see all payments made on that particular date. By default, you will see all payments made today.

Show All Deposits: If you want to see all payments regardless of date, place a check mark in this field.

Show Unapplied Only: This option will allow you to only view deposits that have not been applied, or deposits that have only been partially applied. This is useful in determining which deposits still require work.

Sort and Search: The sort and search functions work in the same manner as the sort and search functions discussed in previous chapters.

Detail: In the upper right corner of the deposit list you will see a button labeled Detail. This button will only be available if you have selected an existing patient or insurance payment that has been applied. Clicking this button will show you the patient accounts to which the deposit has been applied.


 

The Deposit List Detail window can be printed by clicking on the Print Grid button on the right side of the window. This can be helpful for finding discrepancies between an EOB and what has been posted by allowing users to print the detail and compare. Additionally, the printed version will show the dates of service and procedures for the charges to which the payment was applied.

Tips and Tricks:
Because you do not apply capitation payments, you will not have access to the Detail button when a capitation payment is highlited.

 

Export: Clicking the Export button will allow you to export your deposit list to either Quicken or Quickbooks.

Through the deposit list you can apply three types of payments.

  1. Patient Payments: Patient payments entered through the deposit list can be applied to any charges regardless of case, document, or superbill number. These payments can also be made to different patient accounts. This allows you to enter payments that come from a guarantor for one of the patients for whom they are responsible. You will be able to quickly enter up to 2 types of transactions into the patient ledgers. (Patient Payment, and Adjustment
  2. Insurance Payments: Insurance payments entered into the deposit list can be entered for any patient. You will receive a warning message if you try to apply a payment to a patient who does not have that insurance carrier listed in their case information. Additionally, you will be able to quickly enter up to 5 types of transactions into the patient ledgers. (Insurance Payment, Disallowed Amount Adjustment, Withhold Adjustment, Takeback Adjustment, and Deductible)
  3. Capitation Payments: Capitation payments entered into the deposit list are not applied. Therefore they will not affect the practices AR totals. They will ONLY be reflected in your Deposit List reports. You will not see these payments on any other major accounting reports.

We will discuss the process for entering and applying all three of these types of payments. We will focus on the fields that have the biggest effect on the process. For information regarding fields not discussed, refer to the Medisoft Help Files.

 

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Adjustment Definitions

As stated in the introduction, adjustment entry is closely related to payment entry. When applying an EOB from an insurance carrier, you will not only create and apply payments, but you will also create and apply various types of adjustments. We will examine the types of adjustments that can be posted, and when each type should be used.

Disallowed Amount Adjustment: Allowed amounts are defined as the amount insurance companies will base their compensation on. Disallowed amount adjustments are used to reduce the balance on charges that were billed at a rate higher than the allowed amount. If you are using Medisoft Advanced or Higher, this adjustment can be automatically calculated for you through the deposit list. If you are using Medisoft Original, or if you are applying your payments through Transaction Entry, you will need to manually calculate and enter this adjustment amount. The calculation used in determining the amount is (Billed Amount – Allowed Amount) x (-1). If your billed amount is lower than the allowed amount, it is definitely in your best interest to raise your prices.

Withhold Adjustment: Withhold adjustments are used to decrease the AR total on a patient’s account due to money being withheld by the insurance carrier on a previous EOB. Insurance carriers may withhold money due to prior overpayments. These overpayments do not necessarily need are not necessarily going to be for the same patient(s). For this reason, withhold adjustments are often combined with takeback adjustments.

Takeback Adjustment: Takeback adjustments are used to increase the AR total on a patient’s account due to money being withheld by the insurance carrier on a previous EOB. This type of adjustment is applied to the patient(s) who has charges that were overpaid by the insurance carrier. Takebacks are usually entered in conjunction with a withhold adjustment.

Deductible: Deductible entries are used to move the responsibility for a particular charge to the next responsible party without lowering the AR total. If a charge has been applied to a deductible, the patient is responsible to pay for the charge. For this reason you do not want to change the AR amount. You simply want to make sure the charge shows up on the remainder statement.

 

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ERA Adjustment Posting

ERA (Electronic Remittance Advice) Adjustment Posting is an option that works in conjunction with Revenue Management. Revenue Management automatically reads the electronic EOB format returned by the insurance carrier, and applies the payments to the appropriate charges. This is the most efficient way to post payments. The process for posting an electronic EOB will be discussed in the blog posts covering EDI.

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Medisoft Version 19 System Requirements

Note; the requirements have not been officially released, so we are including the current requirements and will change when officially released..

MEDISOFT V18  Technical Requirements

Medisoft V18 is a 32-Bit application.  On a supported 64-Bit platform, the application will run in a 32-Bit mode.

Basic and Advanced – Recommended Basic and Advanced – Minimum
Recommended System Requirements

32-Bit color display (minimum screen display of 1024×768)

Intel Core 2 Duo  1.6 GHz processor

1 GB of available hard disk space

2 GB of RAM for Windows 32-Bit

4 GB of RAM for Windows 64-Bit

Windows XP Professional SP3  32-Bit

Windows 7 Professional or Ultimate 32-Bit or 64-Bit

Windows 8 Professional  32-Bit or 64-Bit

DVD Drive is required for installation

Minimum System Requirements

32-Bit color display (minimum screen display of 1024×768)

Intel Pentium 4   1.0 GHz processor

500 MB available hard disk space

1 GB RAM

Windows Vista Business SP1  32-Bit or 64-Bit

Windows XP Professional SP3  32-Bit

Windows 7 Professional or Ultimate 32-Bit or 64-Bit

Windows 8 Professional  32-Bit or 64-Bit

DVD Drive is required for installation

 

Network Professional
Recommended Server System Requirements

Intel Xeon Dual Core 2.0 GHz processor

10 GB of available hard disk space

4 GB of RAM

Windows 2003 Server Sp2   32-Bit

Windows 2003 R2 Server Sp2   64-Bit

Windows 2008 or 2012  Server 32-Bit

Windows 2008 or 2012 R2 Server 64-Bit

Network Card (NIC)  1Gbps

DVD Drive is required for installation

Minimum Server System Requirements

Intel Pentium 4  2.6 GHz processor

2 GB of available hard disk space

2 GB of RAM

Windows 2003 Server Sp2   32-Bit

Windows 2003 R2 Server Sp2   64-Bit

Windows 2008 or 2012  Server 32-Bit

Windows 2008 or 2012 R2 Server 64-Bit

Network Card (NIC)  1Gbps

DVD Drive is required for installation

Recommended Workstation System Requirements

32-Bit color display (minimum screen display of 1024×768)

Intel Core 2 Duo  1.6 GHz processor

1 GB of available hard disk space

2 GB of RAM for Windows 32-Bit

4 GB of RAM for Windows 64-Bit

Windows XP Professional SP3    32-Bit

Windows 7 Professional or Ultimate 32-Bit or 64-Bit

Windows 8 Professional  32-Bit or 64-Bit

Network Card (NIC)  1Gbps

DVD Drive is required for installation

Minimum Workstation System Requirements

32-Bit color display (minimum screen display of 1024×768)

Intel Pentium 4   1.0 GHz processor

500 MB available hard disk space

1 GB RAM

Windows XP Professional SP3    32-Bit

Windows 7 Professional or Ultimate 32-Bit or 64-Bit

Windows 8 Professional  32-Bit or 64-Bit

Network Card (NIC)  1Gbps

DVD Drive is required for installation

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Figure 1 – Medisoft Payment Entry

The entire purpose of billing insurance claims is in anticipation of the payment that will come as a result of the claim. It is important that you go through the process of applying the payments to the charges being paid. This will allow your aging, remainder billing, and collections to function properly.

These payments often require the entry of various types of adjustments. This depends on the insurance carrier making the payment. The adjustments will also require application to specific charges.

The document that will guide you through the payment/adjustment entry and application process is the EOB or Explanation of Benefits. This document is returned by the insurance carrier along with the payment for the services. Often this document is returned electronically to the doctor. In many instances, insurance carriers are moving towards a policy of ONLY returning electronic EOB’s.

Refer to the EOB handout to see what an EOB looks like.

 

When applying payments, there are three main data files you will be modifying.

  1. MWTRN.ADT: The mwtrn.adt table is the table that contains all of the transactions entered into the system. This includes charges, payments, adjustments, and comments. Most accounting reports are based on the mwtrn.adt table.
  2. MWPAX.ADT: This table is often referred to as the “PAX” table. It is used to link payments to the charges to which they are applied. This table plays a critical role in calculating patient balances, and which party is currently responsible for any given charge.
  3. MWDEP.ADT: The mwdep.adt table is the table that holds all deposits.

In the chapters to follow, we will discuss the manner in which the different payment interfaces update these three tables. It is critical that you understand these processes in order to more fully understand the reason different problems might arise in the use of and reporting on your data.

 

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