Advance Billing for Claim Fund Charge

Until now, the system enabled you to configure the pricing for level funding and generate the claim fund charges for a self-funded employer using either of the following approach:

  • Flat level funding

  • Enrollment based level funding

Now, the system enables you to bill the claim fund charges to a self-funded employer in advance. In case of enrollment based level funding, the system can receive the enrollment transactions for the month of January in the month of December. Once the January enrollment transactions are received in December, the system can create claim fund charges based on the January enrollment in the month of December and accordingly bill the self-funded employer. However, the claim fund charges which are billed in the month of December will be adjusted against the claim, ancillary, or other charges which are eligible for level funding only in the month of January.

To enable this feature, you need to do the following:

  • Set the Advance Level Funding Eligibility Option - A new field named Advance Level Funding Eligibility is available while defining a self-funded policy. You can set the value of the Advance Level Funding Eligibility field to either Yes or No. You can define the Advance Level Funding Eligibility field only through a health care inbound message and not from the user interface. When you create a self-funded policy from the user interface, the Advance Level Funding Eligibility field is non-editable. By default, the value is set to No. You can then change the value through a health care inbound message.

  • Set the Advance Billing Option - A new field named Advance Billing is available while defining a retention type enrollment based pricing rule. You can set the value of the Advance Billing field to either Yes or No.

  • Create a Prospective Bill Period - You need to create a prospective bill period wherein the bill date falls in a month prior to the month of bill segment end date. For example, if the bill segment end date is 01-31-2021, then you can set the bill date to 12-31-2020. You must use the prospective bill period in the recurring flat fee pricing rule using which you want to create the flat claim fund charge which should be billed in advance.

If the Advance Level Funding Eligibility field is set to Y through a health care inbound message, the system activates the self-funded policy even if the policy start date is later than the inbound processing date. Accordingly, a log is maintained for the self-funded policy.

On renewing a self-funded policy, the system provides the ability to copy the advance level funding eligibility value of the base policy to the renewed policy. A new field named Copy Advance Level Funding Eligibility is available while renewing a self-funded policy. If you select the Copy Advance Level Funding Eligibility option, the value is copied from the base policy to the renewed policy. If the Advance Level Funding Eligibility field is set to Y in the base policy, the system activates the renewed self-funded policy on the policy renewal even if the renewed policy's start date is later than the system date.

To implement this business requirement, the following changes are made in the system:

  • While accumulating the charges which are eligible for level funding, the system behaves in the following manner:

    • In case of advance flat level funding, the system considers only those claim fund bill segments where the end date is earlier than or equal to the accumulation run date and then adjusts the accumulation amount against those claim fund charges which were billed in the previous bill period.

    • In case of advance enrollment based level funding, the system considers the enrollment transactions based on their coverage end date. Only those enrollment transactions where coverage end date is earlier than or equal to the accumulation run date are accumulated and then adjusted against the claim fund charges which were billed earlier.

  • If the Advance Level Funding Eligibility field is set to Y for a self-funded policy and the inbound processing date is earlier than the policy start date, the system sets the contract start date to the first day of the month in which the inbound message is processed. Otherwise, the contract start date is set to policy start date.

  • The system determines the bill after date depending on the value set for the Advance Billing field in the retention type enrollment based pricing rule. If the Advance Billing field is set to Yes, then the bill after date is set to accounting date - 1. Here, the accounting date is fetched from the schedule of the account's bill cycle where the transaction date falls. However, if the Advance Billing field is set to No, then the bill after date is set to accounting date - 1. Here, the accounting date is fetched from the schedule of the account's bill cycle where the transaction's coverage end date falls.