Insurance Eligibility Verification

What gets verified before every visit

An eligibility check that stops at "coverage active" misses most of what causes a denial. For each appointment we confirm the plan is active on the date of service, the product type (HMO, PPO, EPO, Medicare Advantage, Medicaid managed care), whether your rendering provider is in network for that product, the copay for the visit type, coinsurance, the deductible remaining and the out-of-pocket maximum remaining. Where the schedule shows the service, we check service-specific benefits: visit limits for physical therapy under 97110 and 97140, behavioral health carve-outs to a separate managed behavioral health organization, chiropractic caps, and whether a referral on file or a prior authorization is required. We also ask whether another payer is primary, because coordination of benefits errors produce CO-22 denials that take months to unwind.

How the 270/271 transaction works and where it falls short

The 270 is the electronic eligibility inquiry and the 271 is the payer's response. Under the HIPAA operating rules a payer has to answer a real-time 270 within 20 seconds, so a clearinghouse batch run against three days of schedule finishes in minutes. The problem is what the 271 leaves out. A generic inquiry using service type code 30 returns plan-level benefits and nothing about the specific CPT you plan to bill. Many payers do not return network status for the rendering NPI at all. Medicare Advantage plans frequently return active coverage while the member has moved to a different plan the payer has not yet updated. So the 271 is the first pass, and anything with a narrow network, a carve-out or a high-dollar service gets a portal check or a call, with the reference number recorded.

The denials this prevents

Eligibility-related denials arrive as a predictable set of claim adjustment reason codes. CO-27 means expenses were incurred after coverage terminated. CO-26 is the mirror image, service before coverage began. CO-22 means another payer should have been billed first. CO-31 and remark N382 mean the patient could not be identified, usually a member ID or date of birth typed wrong at registration. PR-204 means the service is not covered under the patient's current benefit plan, and it lands on the patient. PR-1, PR-2 and PR-3 are deductible, coinsurance and copay, which are not errors, but if nobody told the front desk what to collect they become statements and phone calls instead of card payments at check-in.

Medicare, Medicare Advantage and Medicaid have their own traps

Medicare patients have to be asked about other coverage at each encounter, because 42 CFR 489.20(g) requires providers to bill primary payers before Medicare, and a claim sent to Medicare when a group health plan or liability carrier is primary comes back as a Medicare Secondary Payer rejection. A Medicare patient who joined a Medicare Advantage plan on January 1 still has a valid Medicare card, and the HETS 271 tells you about the enrollment only if you read the plan segment. Qualified Medicare Beneficiaries cannot be billed for Medicare cost sharing at all, and the 271 flags QMB status. Medicaid eligibility can change from one month to the next, so a check on the 28th is not valid for a visit on the 2nd, and managed Medicaid members change plans mid-year. We run Medicaid checks the day before the visit for that reason.

Collecting the right amount at check-in

Verification only pays off if the front desk uses it. For each visit with a known service we calculate an estimate from the contracted allowed amount, the deductible remaining and the coinsurance, and we write the copay from the 271 onto the appointment. For a 99213 with a met deductible that is the copay. For a procedure against an unmet deductible it is the allowed amount, and the patient should hear that before the visit, not on a statement six weeks later. For Medicare patients scheduled for a service Medicare is expected to deny, the front desk is told to issue an Advance Beneficiary Notice, form CMS-R-131, before the service. Self-pay patients are flagged so a good faith estimate goes out under the No Surprises Act.

How the service runs against your schedule

The schedule is pulled three business days ahead and every appointment is checked, first by 270/271 and then by portal or phone where the response is not enough. Results are written to the appointment in your practice management system: coverage status, product, network status, copay, deductible remaining, secondary payer and any authorization or referral flag. Anything that is not clean goes onto an exceptions list that reaches your front desk each morning with a one-line instruction: collect, reschedule, obtain referral or start prior authorization. Same-day additions are checked the morning of the visit. The exceptions list and what happened to each item are included in the weekly report, and recurring registration errors are reported back with the account numbers so the cause gets fixed at the desk.

What eligibility verification hands off

A verified visit feeds three other steps. The authorization flag starts the prior authorization request while there is still time. The recorded copay and estimate go to check-in and later to patient billing, so the statement matches what the patient was told. The payer order and member ID go to claim submission. If you want to know what eligibility errors are currently costing you, the free billing audit pulls the eligibility-related denial codes from your last 90 days of remittances.