There is significant variation in how secondary payers, Medicare secondary for example, report information in an 835 ERA transaction. Some list Medicare allowable as "Secondary Medicare" plan allowable. Others list the actual Secondary Medicare insurance liability as the "allowed" amount.
1. What is the correct allowed amount that a secondary Medicare health plan should report after prior adjudication by Medicare? Is it the original Medicare amount on which the 20% secondary Medicare claim is based or the actual 20% of the amount (possibly plus Medicare deductible) for which the secondary plan is actually responsible? It seems the relevant and correct allowed amount is the allowed amount that is "allowed" by the secondary health plan - in other words, the Medicare co-insurance/deductible amounts.
RFI 2143 clarifies the proper use of OA 23. The correct allowed amount for secondary Medicare claims where the allowed amount for the primary claim is legislatively fixed by government fiat is not entirely clear.
Charge $300
Medicare allowable: $100
Medicare pays $80
Medicare secondary:
Charge: $300
Medicare secondary allowable: $20
Medicare secondary pays: $20
OA 23 = $80
CO 45 = $200
vs
Medicare secondary:
Charge: $300
Medicare secondary allowable: $100
Medicare secondary pays: $20
OA 23 = $80
CO 45 = $200
It appears that reporting of Medicare allowable of $80 by a Medicare secondary plan is not correct. Please clarify.
The payer’s allowed amount, regardless their position in the payment process, is the amount the payer deems payable before assigning member responsibility. It is up to each payer to determine what their payable is. It is not within X12’s purview to determine a payer’s allowed amount.
Review RFI 2143 for proper reporting of OA23.
Related RFIs: 2143, 2601