Glossary

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A

ABN (Advance Beneficiary Notice) — A notice given to Medicare patients before non-covered services. ALJ (Administrative Law Judge) — The third level of Medicare appeals.

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C

CARC (Claim Adjustment Reason Code) — Standardized codes that explain why a claim was adjusted (denied, reduced, etc.). Used in 835 ERA responses. CCN (CMS Certification Number) — A 6-digit identifier assigned to Medicare-certified facilities. Encodes the state, facility type, and sequence number. CF (Conversion Factor) — The dollar amount multiplied by total adjusted RVUs to calculate Medicare payment. Updated annually by CMS. CMS-1500 — The standard paper claim form for professional services. Electronic equivalent: 837P. CPT (Current Procedural Terminology) — A coding system maintained by the AMA for reporting medical procedures and services.

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E

EDI (Electronic Data Interchange) — The electronic exchange of healthcare transactions using X12 standards. E/M (Evaluation and Management) — A category of CPT codes for patient visits (99201-99499). ERA (Electronic Remittance Advice) — The electronic equivalent of an Explanation of Benefits. X12 transaction 835.

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G

GPCI (Geographic Practice Cost Index) — CMS-published indexes that adjust Medicare payment by geographic area. Three components: Work (PW), Practice Expense (PE), and Malpractice (MP).

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H

HCPCS (Healthcare Common Procedure Coding System) — A coding system for services, procedures, and supplies. Level I = CPT codes. Level II = alphanumeric codes for supplies and non-physician services. HPSA (Health Professional Shortage Area) — Areas with a shortage of healthcare providers, which may qualify for payment bonuses.

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I

ICD-10 (International Classification of Diseases, 10th Revision) — The coding system for diagnoses. IPPS (Inpatient Prospective Payment System) — Medicare’s payment system for acute care hospital inpatient stays. Uses DRG-based payment.

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L

LCD (Local Coverage Determination) — A decision by a MAC about whether a service is medically necessary in their jurisdiction.

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M

MAC (Medicare Administrative Contractor) — Regional contractors that process Medicare claims. MPFS (Medicare Physician Fee Schedule) — The system used to pay physicians for Medicare services. Payment = (Work RVU × GPCI + PE RVU × GPCI + MP RVU × GPCI) × CF. MUE (Medically Unlikely Edit) — Edits that limit the number of units of service that can be billed on a single claim line.

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N

NCD (National Coverage Determination) — A nationwide decision by CMS about whether a service is covered by Medicare. NCCI (National Correct Coding Initiative) — Edits that prevent improper coding combinations on claims. NPI (National Provider Identifier) — A unique 10-digit identifier for healthcare providers.

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O

OPPS (Outpatient Prospective Payment System) — Medicare’s payment system for hospital outpatient services. Uses APC-based payment.

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P

POS (Place of Service) — A two-digit code indicating where a service was performed (e.g., 11=office, 22=outpatient hospital).

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R

RARC (Remittance Advice Remark Code) — Supplemental codes providing additional detail about claim adjustments. RVU (Relative Value Unit) — A measure of value used in the MPFS. Three components: Work RVU, Practice Expense (PE) RVU, and Malpractice (MP) RVU.

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S

SNF (Skilled Nursing Facility) — A facility providing 24-hour nursing care. CCN range 4000-4999.

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T

TOB (Type of Bill) — A 3-digit code on UB-04 claims identifying the type of facility, type of care, and billing frequency.

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U

UB-04 — The standard paper claim form for institutional services. Electronic equivalent: 837I.

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X

X12 — The ANSI standard for EDI transactions in healthcare. Common transactions: 270/271 (eligibility), 837P/I/D (claims), 835 (ERA), 276/277 (claim status).