Electronic Remittance Advices (ERAs) and Explanation of Benefits (EOBs) are the bread and butter of revenue cycle management. But actually reconciling these with your claims? That's the tricky part. Misunderstanding an adjustment or missing a payment can cost practices tens of thousands in lost revenue. So let’s break down how to effectively read and match ERAs/EOBs to your claims, pinpoint variances, and fix discrepancies.
Understand the Basics
The first step is understanding what you're looking at. An ERA is an electronic version of an EOB and contains the same critical information: what was billed, what was paid, and why there were any adjustments or denials. It's like a bank statement for your claims.
Each ERA/EOB can have a unique format depending on the payer, but they all generally include the claim ID, payment amount, patient responsibility, and adjustment codes.
Matching Payments to Claims
Starting with the Claim ID
Your best friend here is the claim ID. This unique identifier helps you match payments on the ERA to the original claim submitted. First, ensure the claim IDs on your ERA/EOB match those in your billing system.
But don’t stop there. Cross-reference service dates, procedure codes, and billed amounts. This is where discrepancies often hide — a claim ID might match, but other details might not.
Handling Bundled Payments
Sometimes payers bundle multiple claims into a single payment. This is especially common with large insurance payers like Blue Cross or Humana. If you see a lump sum on the ERA, look for a breakdown or summary that indicates which claims or services are included.
Dealing with Partial Payments
Partial payments are frustrating, but common. If a payment amount doesn't match your expectations, check the adjustment codes. These codes, like CO-45 for contract reductions, tell you why payment was less than expected. Understanding these codes is crucial for reconciling amounts.
Identifying and Resolving Variances
Spotting the Variance
A variance occurs when the payment amount doesn’t match what you billed. Start by confirming if the variance is due to an adjustment, a denial, or an error. Adjustment codes and remarks will usually provide the answer.
For example, if you notice a PR-1 code, this indicates patient responsibility for deductible amounts. But if you spot a CO-97, you're looking at a denial for a service deemed "not covered."
Common Workarounds
If you find discrepancies, don’t assume it’s a mistake by the payer — though it often is. Sometimes, it's a simple data entry error on your end. Validate the amounts billed against what’s in your system.
Payer portals can be glitchy (Cigna and Aetna, anyone?), so you may have to manually verify data. And no, you’re not imagining those interminable hold times — they are real. But persistence pays off.
Engaging the Payer
For unresolved variances, pick up the phone. When calling a payer, have your ducks in a row: date of service, patient info, claim ID, and most importantly, the specific issue. Have you seen the HX code prior to this? Bring it up. This shows you're informed and serious about resolution.
Closing the Loop
Document Everything
Once discrepancies are resolved, document the resolutions. Not just in your EHR but also as a follow-up note. This helps if the same issue arises again, or if you need to escalate the issue down the road.
Adjustments and Write-offs
Make necessary adjustments in your billing system. This includes posting payments, adjustments, and any necessary write-offs. But be cautious with write-offs; they should be a last resort, not a first option.
Moving Forward
Consistent reconciliation is non-negotiable. Build a process that includes regular checks and balances. Use technology to your advantage — billing software and RCM platforms can automate much of this work.
But remember, no technology can replace the keen eyes and analytical skills of a seasoned biller. It’s all about knowing how to read between the lines, understand payer quirks, and never leaving money on the table.
In the end, reconciling ERAs/EOBs is like detective work. It requires attention to detail, persistence, and a methodical approach. Master these steps, and your practice will reap the financial rewards.
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