Glossary

Terms as used across this guide, organized by domain, with links to the pages that treat them fully. Alphabetical within each section.

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Claims, remittances, and the money pipeline

835 / ERA: The X12 835 Health Care Claim Payment/Advice; the electronic remittance advice explaining a payer’s payment, claim by claim. The HIPAA-standard remittance format. → What is an 835? 837: The X12 claim transaction (837P professional, 837D dental, 837I institutional); how claims travel to payers. → Claim lifecycle 270/271, 276/277: X12 eligibility inquiry/response and claim status inquiry/response transactions. Adjudication: The payer’s process of deciding what to pay on a claim: pay, reduce, deny, or pend. Allowed amount: The contracted price for a service under your participation agreement; the ceiling from which payment and patient responsibility are carved. BPR / BPR10: The 835’s payment-header segment; BPR10 carries the payer’s originating company ID, used in reassociation. CARC / RARC: Claim Adjustment Reason Codes and Remittance Advice Remark Codes; the standardized vocabulary of adjustments and denials (x12.org/codes). → Reading denial codes CAS segment: Where adjustments live in an 835; group code + CARC + amount, required to balance against billed charges. Clean claim: A claim that adjudicates without rejection, denial, or requests for more information; clean claim rate measures your front-end quality. Clearinghouse: The switch between your PM system and payers: claim validation (“scrubbing”), routing, and often ERA delivery. Coordination of benefits (COB): Determining payment order when a patient has multiple coverages; a top denial source (CO-109, CO-22). CPT / HCPCS / CDT / ICD-10: The code sets: procedures (CPT/HCPCS medical, CDT dental) and diagnoses (ICD-10) that claims are written in. EOB: Explanation of benefits; the human-readable remittance, typically paper or PDF. → ERA vs. EOB Fee schedule: Your contracted rates with a payer, per code. Know your top 20; audit that you’re actually paid them. PLB segment: Provider-level adjustments in an 835 (recoupments, interest, withholds); the usual explanation for deposit-vs-remittance shortfalls. Posting: Applying a remittance’s payments and adjustments to open claims in the PM system. Prior authorization: Payer pre-approval required before certain services; skipping it produces CO-197 denials with weak appeal rights. Reassociation: Matching an EFT deposit to its 835 via trace number (TRN) and originating company ID. → EFT reassociation Reconciliation (remittance-to-deposit): Tying every remittance to a bank deposit and every payer deposit to a remittance; the control that catches missing money. → Reconciliation Recoupment: A payer clawing back a prior overpayment, usually by offsetting future remittances (see PLB). Superbill: An itemized encounter form (codes + charges) a cash-pay or out-of-network patient submits to their own insurer for reimbursement. Timely filing: The contractual deadline for claim submission; missed = denied (CO-29) with narrow appeal rights. TRN segment: The 835’s trace number; the reassociation key that also rides the ACH addenda.

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Enrollment, credentialing, and identity

Aggregator (payment): A vendor operating payments/remittances for many payers (Zelis, ECHO, Optum Pay, Payspan). Enrollment and payment-method elections often live with the aggregator, not the payer. → Enrollment directory CAQH ProView: The industry-standard credentialing data repository most commercial payers pull from; requires quarterly re-attestation. → Get credentialed CMS-588: Medicare’s EFT authorization form, filed via PECOS. Credentialing / contracting / enrollment: Three distinct steps payers require: verifying you, agreeing rates with you, configuring their systems to pay you. → Get credentialed EFT: Electronic funds transfer; payer payment by ACH. HIPAA-covered payers must offer it on request (45 C.F.R. § 162.1602). → Enroll in EFT/ERA EIN / TIN: The entity’s federal tax identifiers; the identity payer contracts and enrollments attach to. I&A account: CMS Identity & Access login managing NPPES and PECOS access. NPI (Type 1 / Type 2): National Provider Identifier for individuals (Type 1) and organizations (Type 2), via NPPES. PECOS: Medicare’s provider enrollment system. Virtual credit card (VCC): Payer payment via one-time card number, costing the practice interchange fees; declinable in favor of EFT. → ERA vs. EOB

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Patient payments and financing

BNPL (buy now, pay later): General point-of-sale installment products (e.g., Affirm) occasionally used in healthcare; distinct from healthcare-specialized financing. Card-on-file: Stored patient payment credentials with authorization to charge balances; the backbone of pre-service collection and self-carried payment plans. Deferred interest: Promotional financing structure (classically CareCredit-style) where interest accrues retroactively if the balance isn’t cleared within the promo period; a patient-experience and regulatory-scrutiny hotspot, disclose carefully. Good Faith Estimate (GFE): The written cost estimate the No Surprises Act requires for uninsured/self-pay patients for scheduled services (45 C.F.R. § 149.610). Applies to cash-pay practices broadly. → Owner’s task repo Merchant discount fee: What the practice pays a financing provider or card processor per transaction; in patient financing it varies by plan length and promo type, the number to compare across Cherry/CareCredit/Sunbit-type products. Patient financing (third-party): Point-of-sale installment products (Cherry, Sunbit, CareCredit et al.): the practice is paid upfront minus a fee; the patient repays the financer. → Owner’s task repo, Part 3 Patient responsibility: Deductible, coinsurance, copay, the PR-group-coded share of the allowed amount collected from the person, not the payer. Surcharging: Passing card fees to patients; regulated by state law and often restricted by payer contracts for insured balances.

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Practice models

Cash-pay / direct-pay practice: No payer contracts; patients pay directly (often with superbills for out-of-network reimbursement). Removes credentialing; adds GFE duties and a Medicare-posture decision. → Owner’s task repo, Part 2B Concierge medicine: Membership fee for access/amenities, typically on top of insurance billing, which is what distinguishes it from DPC and creates the duplicate-billing questions DPC avoids. Direct primary care (DPC): Flat periodic membership covering defined primary-care services, no insurance billing; exempted from insurance regulation by statute in many states when structured to fit. Hybrid model: Insurance base plus cash service lines and/or telehealth; watch the seams (copay waivers, GFE consistency, revenue-stream segregation). → Owner’s task repo, Part 2D Medicare opt-out: The formal process (affidavit + private contracts, 42 U.S.C. § 1395a(b)) required to treat Medicare beneficiaries on a private cash basis; renews automatically in two-year cycles.

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Telehealth

Compacts (IMLC / PSYPACT / NLC): Interstate licensure vehicles (physicians / psychologists / nurses) that expand a telehealth practice’s map without full per-state licensure. Distant site / originating site: Where the clinician is / where the patient is, in Medicare telehealth rules; the patient’s location governs licensure generally. EPCS: Electronic prescribing of controlled substances; certified e-prescribing required alongside DEA registration. Payment parity: State rules on whether payers must reimburse telehealth at in-person rates; varies by state and modality. Ryan Haight Act: Federal law requiring an in-person evaluation before controlled-substance prescribing via telemedicine, subject to DEA flexibilities that have been extended repeatedly (currently through 2026). → Owner’s task repo, Part 2C

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Compliance and regulatory

AKS (Anti-Kickback Statute): Federal prohibition on remuneration for referrals of federal-program business (42 U.S.C. § 1320a-7b); the reason routine copay waivers and referral arrangements need counsel. BAA (Business Associate Agreement): The HIPAA-required contract with every vendor touching PHI, EHR, email, texting, billing service, financing platform. Inventory annually. CLIA waiver: Certification required for even simple in-office lab tests (CLIA, 42 U.S.C. § 263a); renewable. CPOM: Corporate practice of medicine doctrine; state-law restrictions on who may own clinical practice entities. → CPOM and the PC and the MSO-PC Wiki Escheatment: State unclaimed-property law; where stale patient credits legally go if unrefunded. → Patient refunds HIPAA security risk analysis: The annual, documented security assessment 45 C.F.R. § 164.308 requires; the first thing OCR asks for after a breach. No Surprises Act: Federal law (2022–) covering surprise billing and requiring Good Faith Estimates for self-pay patients; see GFE above. OSHA obligations: Workplace-safety duties including bloodborne-pathogen training, hazard communication, and exposure control plans, annual training cadence. Sixty-day rule: Identified Medicare/Medicaid overpayments must be reported and returned within 60 days (42 U.S.C. § 1320a-7k(d)); retention creates False Claims Act exposure. Stark Law: Physician self-referral prohibition (42 U.S.C. § 1395nn) governing financial relationships with entities you refer to; strict liability, so structure first.

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Business, entity, and deals

Buy-sell agreement: The co-owner contract governing exits: death, disability, license loss, departure, deadlock. → Associates vs. partners Days in A/R / net collection rate: Core revenue-cycle KPIs: how long revenue sits between service and cash, and the share of collectible dollars actually collected. DSO / MSO / MSA: Dental/management services organization and the management services agreement binding it to the PC. → MSO-PC Wiki EBITDA / QoE: Earnings measure deals are priced on, and the quality-of-earnings review that tests it. → Buy a practice LOI: Letter of intent; non-binding on price, binding on exclusivity. PC / PLLC: Professional corporation / professional LLC; the licensee-owned entity form most states require. Tail coverage: Malpractice extension covering claims reported after a claims-made policy ends; decide who pays it at hiring, not departure. TI allowance: Tenant-improvement dollars negotiated into a lease toward build-out.

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Banking

ACH / addenda: The payment network payer EFTs ride, and the record within an ACH entry carrying the TRN for reassociation; ask whether a bank surfaces addenda before trusting it with payer deposits. FDIC coverage / sweep networks: $250k per depositor/bank/category standard coverage (FDIC); sweep networks extend it by distributing balances across many banks. Lockbox: A dedicated receiving address where payer mail is opened, scanned, and checks deposited on arrival. → Lockboxes Operating / tax / savings structure: The minimum account architecture. → Setting up your banking