To say that the list of medical billing laws in California is extensive would be an understatement. Navigating the tangled—and always-evolving—web of billing rules and regulations for our state can easily become overwhelming, even for the most experienced providers.
If you and your staff are not familiar with the very latest medical billing laws in California, it’s easy to make mistakes. This can have disastrous implications for your practice.
Let’s examine several key medical billing regulations in California and how to make sure your practice is in compliance.
Evolution of Medical Billing Laws in California
The Medical Practices Act was the very first medical billing law in California. This legislation was passed in 1975 and solidified the first guidelines for how California medical providers should bill for their services. The law mandated the maintenance of accurate records for both services rendered and billings.
Over the years, California medical billing laws have only grown more numerous and complex. These regulations play a crucial role in safeguarding patients from overbilling and guaranteeing that providers are adequately reimbursed for their care.
Compliance with Medical Billing Laws in California
We completely understand how daunting it can be as a healthcare professional to keep up with constantly submitting timely and accurate claims. Despite your team’s best efforts to ensure precision, errors are inevitable. Of course, these mistakes can lead to potential liability for your practice.
Keeping constantly informed of medical billing laws in California is essential for several reasons:
- Shield your practice from liability stemming from fraudulent billing.
- Curb abuse, waste, and fraud.
- Preserve your brand image.
- Secure profitability by ensuring medical providers receive timely, accurate, and fair payment.
- Improve the patient experience.
- Protect patients from inaccurate or excessive fees.
Even minor errors in medical billing compliance can cause significant issues for medical professionals and providers.
Key Medical Billing Laws in California
Medical billing compliance is overseen by the Office of Inspector General (OIG). The OIG monitors US Department of Health and Human Services (HHS) programs.
By enforcing compliance with HHS initiatives, safeguarding patient data, and promoting ethical healthcare, medical billing laws in California play a crucial role in the healthcare landscape. Among these, the Healthcare Information Portability and Accountability Act (HIPAA) stands out for its role in setting strict standards for patient health information security.
Moreover, the Affordable Care Act (ACA) significantly impacts healthcare compliance by mandating providers to establish ethics and compliance programs to qualify for reimbursement from federally-funded healthcare schemes.
The ACA delineates seven key components for a robust compliance program, with the OIG providing valuable insights into optimal practices.
Medical billing laws in California work a little differently with regard to Medicaid and Medicare patients because in our state, we have our own unique Medicaid program—Medi-Cal.
Medi-Cal is a public health insurance program offering essential healthcare services to low-income individuals. The funding for Medi-Cal is equally shared between the state and federal governments. To that end, the Centers for Medicare and Medicaid Services (CMS) regulate the billing of Medicaid and Medicare patients.
Additionally, medical billing laws in California mandate that claims for medical services be submitted to the patient’s health insurer within a specific period.
Always remember the following guidelines to ensure compliance with medical billing laws in California:
- Claims must be filed within 30 days of the service date.
- If a claim is denied, the medical practice has 90 days to appeal the decision.
- If a claim remains unpaid after 45 days, the patient can file a complaint with the Department of Managed Health Care.
Coding Medical Billing Laws in California
Navigating medical coding compliance involves adherence to established coding standards like the International Classification of Diseases (ICD) codes and Current Procedural Terminology (CPT) codes. These standards guarantee accurate coding reflecting provided medical services, facilitating proper billing and reimbursement.
The CPT coding protocol, overseen by the American Medical Association (AMA), utilizes standardized codes to detail healthcare professionals’ services and procedures. These codes play a vital role in effective communication between healthcare providers and payers.
ICD coding guidelines offer a structured method for categorizing procedures, symptoms, and diagnoses, ensuring precise and consistent medical documentation crucial for accurate reimbursement.
Thus, upholding precise coding is imperative for complying with medical billing laws in California. Mistakes can lead to accusations of fraud, reimbursement delays, and claim rejections. Moreover, inaccuracies may result in underbilling or overbilling. This can wreak havoc on your practice’s revenue.
Unethical Medical Billing
Sadly, there are reasons for such a nightmare of medical billing laws in California. The prevalence of medical billing fraud and unethical behaviors in the industry means that maintaining integrity in your billing processes is more important than ever. After all, your billing practices directly influence your credibility, financial well-being, and patient trust—regardless of your intentions.
However, more importantly, patients entrust their well-being to healthcare providers while undergoing medical procedures. These patients rely on transparent and precise billing procedures. Plus, patients tend to prefer providers with a reputation for ethical billing practices.
To that end, steer clear of the following common unethical billing practices.
Fraudulent Upcoding
Fraudulent upcoding is a sneaky tactic similar to the upselling tricks you see in other sectors. Instead of offering a better service, patients end up paying for a medical service they never even had.
Let’s say you billed a patient for a thorough exam when only a basic exam was conducted. This practice exploits patients’ limited knowledge of the industry. Furthermore, it is a clear case of healthcare fraud, according to medical billing laws in California.
Beyond the financial penalties, the most significant impact is often the damage to the relationship with patients. Unless patients are assured that the overcharge was a mistake, they are likely to lose trust in your practice.
Double Billing
Double billing is exactly what it sounds like—submitting claims to two different insurance companies for the same service or procedure in order to receive double reimbursement.
For instance, a practice might bill both Medicare and a private health insurance provider for the same service. Medical billing laws in California strictly prohibit this practice. The consequences are similar to fraudulent upcoding, such as fines and exclusion from insurance programs.
Moreover, double billing adversely affects patients. Unfair overcharges can make it difficult for patients to afford the care they need.
Fraudulent Unbundling
Unbundling fraud refers to billing a patient for each individual part of a bundled service as separate procedures—when they should be charged for the service as a whole.
Imagine running a blood panel test for a patient. However, instead of packaging it as one service as intended, you decide to bill them for each component separately to boost profits.
This deceitful practice is sly, as it blurs the lines between bundled and individual services. Yet it falls on healthcare providers to abstain from this unethical path to avoid legal repercussions.
Upfront Balance Billing
When healthcare providers bill patients for the difference between what the insurance company pays and the provider’s charges, it’s called balance billing. Usually this happens when emergency care is out-of-network or in non-emergency cases where the provider is out-of-network without patient choice.
Upfront balance billing is when an in-network provider bills a patient before a procedure, anticipating insurance denial.
While legality varies by state, California outlaws this practice. Even where legal, patients could face delays or forego crucial treatment due to unexpected costs. Additionally, they might not be able to pay the remaining balance.
Guidance for Medical Billing Laws in California
Complying with medical billing laws in California may seem like a headache at first, but with a little direction, it can become much more manageable.
Know the Difference between Private Pay & Medicaid/Medi-Cal
Make sure you understand the two primary types of medical billing in California: private pay and Medicare/Medi-Cal. Private pay involves patients paying their own medical bills, whereas Medicare/Medi-Cal is a government-funded program that provides medical coverage for eligible individuals.
Submit Medical Bills to the Correct Insurance Company
Sending a bill to the wrong insurer can result in rejection, requiring the medical practice to resubmit the claim. This process can lead to delays in receiving reimbursement for provided services.
Keep Accurate Records
Maintaining precise and current records of medical billing involves keeping accurate patient information, documenting all services provided, and recording payments received.
Naturally, accurate records are essential for ensuring correct processing of bills and preventing reimbursement issues.
Partner with a Reliable Medical Billing Service
A reputable billing service has comprehensive knowledge of the medical billing laws in California. They are well-equipped to ensure accurate and timely submission of bills for you.
Help with Navigating Medical Billing Laws in California
Upholding medical billing laws in California can be a challenge, even when you have the best intentions.
The good news is that there is help available. By outsourcing your medical billing to a top service like California Medical Billing, you can ensure compliance with all state and federal billing regulations.
Our seasoned experts strictly follow industry protocols, including the rigorous mandates of HIPAA.
Medical Billing Laws in California Matter
Medical billing law in California is a beast. From understanding key regulations such as HIPAA to being aware of the agencies that regulate medical billing practices, it is evident that healthcare providers must prioritize compliance. As our healthcare industry continues to evolve, this practice is essential for all providers to provide quality care while maintaining ethical practices.
Let us all commit to upholding these principles for a better and more efficient healthcare system for all.
