RFI Browser

Back  RFI # 1072: Section 1.4.5 - 005010X222

Formal vs. Informal Help Informal Formal

Submitter

Mendenhall Gigi

Description

Section 1.4.5 of 005010X222 states:
“The prior payer payment + the sum total of all patient responsible adjustment amounts = the
Allowed amount. The Patient Responsible adjustments are identified by use of the
Category Code PR in CAS01.”
This calculation only holds true if the service is allowed. If the service is denied the allowed amount reported in the AMT*AAE would be zero. Assuming the Patient Responsible adjustment amount is equal to the amount billed, the calculation above would not work. How should this paragraph be applied in a denial situation, or should it be applied? Should section 1.4.5 be clarified in some way to avoid confusion in a denial situation?
Example:
LX*2
SV1*HC:86580*23*UN*1*11**2
DTP*472*D8*20100201
REF*6R*66266639
AMT*AAE*0
SVD*04102*0*HC:86580**0
CAS*PR*49*23

The calculation in 1.4.5 does not work as the service is denied.

Response

As indicated in Section 1.4.5, one of the main reasons why the allowed and approved amounts were removed from the 837 Guides in version 5010 was due to the fact that each payer involved in the payment process has their own interpretation of what is an allowed expense under their benefit provisions. Therefore, it is up to the receiving payer in a secondary claim situation to evaluate the prior payer payment amount and each claim adjustment group code and associated claim adjustment reason code and amount to their internal benefit provisions when determining what they consider to be their allowed amount. It should also be noted that the Allowed Amount AMT*AAE segment does not exist in version 5010.

Recommendation

The Guidance for calculating the Allowed Amount as determined by the payer in Section 1.4.5 is not a formula to be applied in every situation, but a general instruction on which fields should be examined. The Work Group will consider re-wording or removing this guidance from the next version of the 837 Guides.
Submission 6/9/2010
Status Date 8/10/2010
Status F - Final
Primary References
Document 005010X222
Section1.4.5
Page26
Set ID837