Revenue cycle management systems offering the auto-adjudication of 835 ERA data files is extremely common these days.

It is likely that some newer medical billing specialists have little to no experience in deciphering the details of a remittance advice (RA). 

Even those with the experience can sometimes get frustrated when having to manually adjudicate a payment and determining if it is balanced.

Contact us now to learn how Iridium Suite from Shavara can “simplify the complex” by utilizing our advanced/customizable auto-adjudication functionalities.

The RA format used by the Medicare Administrative Contractors (MACs) is standardized and must follow strict balancing rules.  According to HIPAA, every electronic transaction a MAC issues must balance at the service-line, claim, and transaction levels.Even thoughCommercial payers are held to the same rules 835 ERA files, I have seen some variations in paper RAs. 

Here’s how and why your Medicare RA should balance:

                Service Line balancing:  PROV PD amount = submitted charge – *any adjustments

*Any adjustment applied to the submitted charge and/or units with the appropriate Group Codes, CARCs, and RARCs explaining the adjustments.  Examples are: PROV ADJ AMT CO-45 for the contractual write –off,   and DEDUCT AMT or COINS AMT that are patient responsibility.

Claim Level balancing: NET amount = sum of submitted charges – any adjustments – *any previous payments

*Services that had a previous payment will show this amount and it will be deducted from the PROV PD amount.

Transaction Level balancing: EFT or Check Amount = sum of all claim level payments – *provider-level adjustments (PLB)

*PLBs are reported below the claim totals. These adjustments are not specific to a particular claim or service on this SPR. They often reference a previously overpaid service and the “recoupment” amount being applied.

Notes about Service Line and Claim Level Adjustments:

Positive adjustments (for example, deductible paid by the beneficiary) reduce the provider’s amount of payment from Medicare

Negative adjustments (for example, interest) increase the amount of the payment from Medicare. Any adjustment with a negative sign reflects an increase in Medicare payment.

You can see more details in the Reading a Professional Remittance Advice (RA) published by the Medical Learning Network.