Domain Knowledge Healthcare Industry Part 1

This article discuss common healthcare terms from a payer perspective and gives a overview
basic HIPAA messages.

Common healthcare terms:

- Payer
- Plan
- Provider
- Member
- Subscriber
- Claim
- Product
- COB (Coordination of benefits)
- PCP (Primary Care Provider)
- Capitation
- HIPAA
Healthcare payer services:
- Revenue Management
- Customer Service
- Product Management
- Consumer Management
- Risk Management
- Care Management
- Provider Management
- Member Management
- Reimbursement Management
Standard Code Sets:
ICD-9-CM Diagnosis & Inpatient Procedures
CPT-4 Outpatient Procedures
HCPCS Ancillary Services & Procedures
CDT-2 Dental Terminology
NDC National Drug Codes
DRG Diagnostic Related Groupings

ICD-9-CM:
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Domain Knowledge Healthcare Industry Part 1

International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM,
ICD-10-CM) - This is the universal coding method used to document the incidence of disease,
injury, mortality and illness.
A diagnosis and procedure classification system designed to facilitate collection of uniform and
comparable health information.
The ICD-9-CM was issued in 1979. This system is used to group patients into DRGs, prepare
hospital and physician billings and prepare cost reports.
Classification of disease by diagnosis codified into six-digit numbers.

Diagnosis Related Groups (DRGs):

An inpatient or hospital classification system used to pay a hospital or other provider for their
services and to categorize illness by diagnosis and treatment.
A classification scheme used by Medicare that clusters patients into 468 categories on the
basis of patients' illnesses, diseases and medical problems. Groupings of diagnostic categories
drawn from the International Classification of Diseases and modified by the presence of a
surgical procedure, patient age, presence or absence of significant complications/other relevant
criteria.
System involving classification of medical cases and payment to hospitals on the basis of
diagnosis.

Common Health Plan Types:

HMO
PPO
POS
Medicaid
Medicare
Defined Contribution

HMO:

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Domain Knowledge Healthcare Industry Part 1
A health maintenance organization (HMO) is a health care delivery system that accepts
responsibility and financial risk for providing a specified set of health care services to an
enrolled membership in exchange for a fixed, prepaid fee from the purchaser (i.e., either the
employer, government or an individual.) HMOs build network through contracts with selected
physicians or physician groups, hospitals, and other providers who render care for a given
population for a discounted fee in anticipation of an increased volume of patients. Those
individuals who become members of an HMO (i.e., enrollees) agree to receive care from this
contracted network of providers.
Characterized by a PCP, all treatment/referrals thru PCP

PPO:

A Preferred Provider Organization (PPO) is a group of health care professionals and/or
hospitals that contract with an employer or insurance company to provide medical care to a
specified group of patients. Participating health care providers exchange discounted services for
an increased volume of patients from this group. Insurance companies offer PPOs to give their
members a choice of either in-network benefits or out-of-network benefits.

Continues in Part 2...
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