Financing Healthcare (Part 2)
                                                                  Learning Objectives
               •       Describe the revenue cycle and the billing process undertaken by 
                       different healthcare enterprises. (Lecture a) 
               •       Understand the billing and coding processes, and standard code 
                       sets used in the claims process. (Lecture a)
               •       Identify different fee-for-service and episode-of-care reimbursement 
                       methodologies used by insurers and healthcare organizations in the 
                       claims process. (Lecture a)
               •       Review factors responsible for escalating healthcare expenditures in 
                       the United States. (Lecture b)
               •       Discuss methods of controlling rising medical costs. (Lecture c)
               Health IT Workforce Curriculum                          Introduction to Healthcare and Public Health in the US                  
                                                  Version                                                 Financing Healthcare (Part 2)                                                                                    2
               3.0/Spring 2012                                                                                                              Lecture a
                                                             Financing Healthcare (Part 2) 
                                                                                                                                        Lecture a - Goals
                             •                Describe the revenue cycle and the billing process 
                                              including charge capture and coding in the cycle that 
                                              ensures appropriate reimbursement
                             •                Review the use code sets and electronic data 
                                              interchange transactions used in the claims process 
                             •                Examine different methodologies used by payers to 
                                              reimburse providers
                             HHeeaalltthh  IITT  WWoorrkfkfoorrcece  CCuurrrriiccuulluumm                                                     Introduction to Healthcare and Public Health in the US                  
                                                                                                   VVeerrsisioonn                                                                Financing Healthcare (Part 2)                                                                                                                                                                                                                                       33
                             33..00//SSpprriinngg  22001122                                                                                                                                                                       Lecture a
                                      The Business of Healthcare
               • Revenue to HCOs different than typical business
                          –                                                                                            rd
                                  Payments made by 3  party
                                      •         st
                                            1  party – insured or patient
                                      •         nd
                                            2  party – the HCO or provider
                                      •         rd
                                            3  party – the insurance company or plan that 
                                            pays the HCO or provider
                          –Payment depends on
                                      • Type of service and diagnosis
                                      • Payer formula to determine 
               Health IT Workforce Curriculum                          Introduction to Healthcare and Public Health in the US                  
                                                  Version                                                 Financing Healthcare (Part 2)                                                                                    4
               3.0/Spring 2012                                                                                                              Lecture a
                                    The Business of Healthcare 
               • Revenue (continued)
                          –Payments for identical services may vary from 
                                  payer to payer
                          –The government  pays for approximately 47% 
                                  of all medical services rendered
               Health IT Workforce Curriculum                          Introduction to Healthcare and Public Health in the US                  
                                                  Version                                                 Financing Healthcare (Part 2)                                                                                    5
               3.0/Spring 2012                                                                                                              Lecture a
                        The Revenue Cycle and Medical 
                                                                                                    Billing
               • Revenue Cycle - standard set of activities and 
                       events that produce revenue or income for a 
                       healthcare provider.  
               • Medical billing - the process of submitting claims 
                       to insurance companies in order to receive 
                       payment or reimbursement for services rendered 
                       by a healthcare provider.
               Health IT Workforce Curriculum                          Introduction to Healthcare and Public Health in the US                  
                                                  Version                                                 Financing Healthcare (Part 2)                                                                                    6
               3.0/Spring 2012                                                                                                              Lecture a