Advance Beneficiary Notice (ABN)    A notice that a doctor or supplier gives to a Medicare beneficiary to sign when the doctor plans to provide a service that he or she believes Medicare does not consider medically necessary and he or she believes that Medicare will not pay for. If the beneficiary/patient does not receive and sign the ABN before service is provided, and Medicare does not pay for it, then the beneficiary/patient does not have to pay for it. If the ABN is provided and signed and Medicare does not pay for it, then the beneficiary/patient will have to pay for the service(s). 3


Anonymous Hotline Caller When calling the integrity hotline, you can choose to be anonymous. This means no one will know who you are and there will be no way to obtain this information.(no Source)

Anti-Kickback Law Prohibits the solicitation, receiving, offering or paying of any remuneration directly or indirectly in cash or in any kind of exchange for a Medicare or Medicaid referral. 2 

APC Ambulatory Payment Classifications (APCs) are groupings of hospital outpatient health care services based on similar cost and clinical characteristics. APCs serve as the new "unit of payment" under Medicare's Outpatient Prospective Payment System (OPPS). 5

Attorney-Client Privilege A legally accepted policy that communication between a client and attorney is confidential in the course of the professional relationship and that such communication cannot be disclosed without the consent of the client. Its purpose is to encourage full and frank communication between attorney and their clients.2

Audit, Baseline A systematic inspection of records, policies, and procedures with the goal of establishing a set of benchmarks for comparison for future inspections. 2

Audit, Concurrent An ongoing inspection of records, policies, and procedures at a given point in time in which identified potential problems are investigated as they arise (e.g., pre-billed records). 2

Audit, Retrospective A comprehensive inspection of records policies, and procedures done usually in anticipation of launching a compliance program.  All potential problems are identified and then investigated (e.g., post-billed, historical audit). 2

Business Associate A person or organization that performs or assists in the performance of a function of activity involving the use of disclosure of individually identifiable health information on behalf of a covered entity of provides services such as legal, actuarial, accounting, consulting, data aggregation, management administration, accreditation or financial services to or for a covered entity. 2

Carrier A commercial health insurance company under contract with the Centers for Medicare & Medicaid Services (CMS) to handle claims processing for Medicare Part B, including the payment of claims for items and services provided in a given area.1

Civil Monetary Penalties Law (CMPL) Regulations which apply to any claim for an item or service that was not provided as claimed or that was knowingly submitted as false, and which provides guidelines for the levying of fines for such offences.2

Center for Medicare & Medicaid Services (CMS) U.S. Federal agency which administers Medicare, Medicaid, and the State Children's Health Insurance Program.1

Compliance Adherence to the requirements of the Medicare and Medicaid laws and regulations and as stated in the Social security Act and the regulations administered by the Health Care Financing Administration (HCFA) and other federal and state agencies. 2
Also:  Corporate Compliance

Confidential Hotline Caller When calling the integrity hotline, you can choose to be confidential. This means if you tell the integrity officer your name, no one else will find out without your permission (to the extent allowed by law).(no source)

Coordination of Benefits A program that determines which plan or insurance policy will pay first if two health plans or insurance policies cover the same benefits.3

Co-payment The amount paid by the beneficiary/patient for each medical service like a doctor's visit. A copayment is usually a set amount paid for a service. For example, this could be $5 or $10 for a doctor's visit.3

Corporate Integrity Agreement (CIA) A negotiated settlement between a health care provider and the government in which the provider accepts no liability, but must agree to implement a strict plan of government-supervised corrective action.2

Coverage The decision of whether or not to include a procedure, drug, or device as a benefit of the health plan.5

Covered Entities  (1) Health plan; (2) Health care clearinghouse; or (3) Health care provider who transmits ay health information in electronic form in connection with a transaction covered by this subchapter. 2

CPT  "Physicians' Current Procedural Terminology". An annual publication of the American Medical Association, which lists the descriptive terms and the numeric identifying codes and modifiers for describing and reporting medical services and procedures performed by physicians. These codes are required on claims submitted for Medicare payment.1

Deductible The annual amount payable by the beneficiary/patient for covered services before the third party payer makes reimbursement.3

Diagnostic Related Groups (DRG)A classification system that groups patients according to diagnosis, type of treatment, age, and other relevant criteria. Under the prospective payment system, hospitals are paid a set fee for treating patients in a single DRG category, regardless of the actual cost of care for the individual.3

 Disclosure The release, transfer, provision of, access to, or divulging in any other manner of information outside the entity holding the information.2

DRG Creep Illegal practice of intentionally billing using a DRG which provides a higher payment rate than the DRG that accurately reflects the diagnosis and treatment actually provided.2

Durable Medical Equipment (DME)Durable medical equipment, as defined by Medicare, is equipment which can 1) withstand repeated use, 2) is primarily and customarily used to serve a medical purpose, 3) generally not useful to a person in the absence of an illness or injury, and 4) is appropriate for use in the home. Equipment used in the treatment of health conditions and impairments, such as oxygen, wheelchairs, hospital beds, walkers.1

Durable Medical Equipment Regional Carrier (DMERC)  A commercial health insurance company under contract with the Centers for Medicare & Medicaid Services (CMS) to handle claims processing for durable medical equipment. There are a total of four DMERCs, each servicing a specific geographic area.1

False Claims Act (FCA)  Originally adopted in 1863 during the Civil War to discourage suppliers from overcharging the federal government, legislation that prohibits anyone from knowingly submitting or causing to be submitted a false or fraudulent claim.2

Federal Sentencing Guidelines Guidelines developed by the U.S. Sentencing Commission, an independent agency in the judicial branch of government established by the 1984 Sentencing Reform Act, to govern the sentencing of individual defendants (1987) and organizations (1991).2

Fee Schedule A listing of accepted charges or established allowances for specified medical, dental or other procedures or services. It usually represents either a physician's or third party's standard or maximum charges for the listed procedures.1

Fiscal Intermediary  A private company that contracts with Medicare to Pay Part A bills and Part B bills for outpatient hospital services.1

Fraud The intentional deception or misrepresentation that an individual knows, or should know, to be false, or does not believe to be true, and makes, knowing the deception could result in some unauthorized benefit to himself or some other person(s).3

Fraud and Abuse Fraud: To purposely bill for services that were never given or to bill a service that has a higher reimbursement than the service produced. 

Abuse: Payment for items or services that are billed by mistake by providers, but should not be paid for by third party payers.3

HCPCS (pronounced "hick-picks") HCFA Common Procedure Coding System. This system represents the entire three-level coding structure (CPT, national codes, and local codes). 5

Health and Human Services, Department of (HHS)The department of the executive branch of the US government with health care accountability, including responsibility for the Public Health Services, Center for Medicare and Medicaid Services (CMS), and the Social Security Administration.2

Health Insurance Portability and Accountability Act of 1996 (HIPAA)A Federal law that allows persons to qualify immediately for comparable health insurance coverage when they change their employment relationships. Title II, Subtitle F, of HIPAA gives HHS the authority to mandate the use of standards for the electronic exchange of health care data; to specify what medical and administrative code sets should be used within those standards; to require the use of national identification systems for health care patients, providers, payers (or plans), and employers (or sponsors); and to specify the types of measures required to protect the security and privacy of personally identifiable health care information. Also known as the Kennedy-Kassebaum Bill, the Kassebaum-Kennedy Bill, K2, or Public Law 104-191.3

ICD-9-CM International Classification of Diseases, 9th Revision, Clinical Modification is a listing of codes describing medical conditions and procedures.5

Identified Hotline Caller When calling the integrity hotline, you can choose to be identified. This means you provide your identity and permission to use it in connection with the report.5

JCAHO see The Joint Commission 

The Joint Commission (previously JCAHO) A not-for-profit organization that develops standards and performance measures conducts regular on-site surveys based on those standards and measures, and awards accreditation decisions for hospitals and other health care facilities.2

MAC Medicare Administrative Coordinator.

A Medicare Administrative Contractor (MAC) is the new contracting entity that is responsible for the receipt, processing and payment of Medicare fee-for-service claims. In addition to providing core claims processing operations for both Part A and Part B, the MAC will be the primary contact for physicians and perform functions related to: Appeals, Provider Outreach and Education, Financial Management, Provider Enrollment, Reimbursement, Payment Safeguards, and Information Systems Security.

Managed Care Medical care delivery system, such as HMO or PPO, where someone "manages" health care services a beneficiary receives; each plan has its own group of hospitals, doctors and other health care providers called a "network"; usually promote preventive health care; may have to pay a  fixed monthly premium and a co-payment each time a service is used.1

Medicaid Title XIX of the Social Security Act is a program which provides medical assistance for certain individuals and families with low incomes and resources. The program, known as Medicaid, became law in 1965 as a jointly funded cooperative venture between the Federal and State governments to assist States in the provision of adequate medical care to eligible needy persons. Medicaid is the largest program providing medical and health-related services to America's poorest people. Within broad national guidelines which the Federal government provides, each of the States:

  1. Establishes its own eligibility standards
  2. Determines the type, amount, duration, and scope of services
  3. Sets the rate of payment for services
  4. Administers its own program 3

Medically Necessary Services or supplies that: are proper and needed for the diagnosis, or treatment of a medical condition; are provided for the diagnosis, direct care, and treatment of a medical condition; meet the standards of good medical practice in the local area; and are not mainly for the convenience of the beneficiary/patient or the doctor.3

Medicare Title XVIII of the Social Security Act, federal health insurance program for people 65 and older and some under 65 who are disabled. Medicare has two parts. Part A is Hospital Insurance and primarily provides coverage for inpatient care. Part B is Medical Insurance and provides limited coverage for outpatient care, physician services, diagnostic tests, supplies and ambulance services for the diagnosis and treatment of illness or injury.1

Medicare as Secondary Payer (MSP) Situations, defined by law, in which payment may be made only after another source of medical benefits has either paid or denied payment of medical items and/or services. Medicare is a health insurance program for:

  1.   People 65 years of age and older
  2. Some people with disabilities under age 65
  3. People with End-Stage Renal Diseases (permanent kidney failure requiring dialysis or a transplant) 1, 4

Medicare Carrier A private company that contracts with Medicare to pay Part B bills.4

National Coverage Decision (NCD) Policy A policy developed by CMS that indicates whether and under what circumstances certain services are covered under the Medicare program. It is published in CMS regulations, published in the Federal Register as a final notice, contained in a CMS ruling, or issued as a program instruction.2

Non-Retaliation In the context of the workplace, non-retaliation means a report of one or more parties engaged in wrongdoing does not result in the reporter losing his/her job or a supervisor or coworker making the work environment intolerable due to a report that is submitted.6

Office of Inspector General (OIG)/DHHS The agency within the US Department of Health and Human Services responsible for the investigation of suspected fraud and abuse and performing audits and inspections of HHS programs. The OIG has authority to levy certain sanctions and civil money penalties.1

OIG Compliance Program Guidance  Guidelines issued by the Office of the Inspector General for the suggested development of compliance programs. There are currently guidelines for hospitals (2/1998); clinical laboratories (8/1998); home health agencies (8/1998); third-party medical billing companies (11/1998); DME prosthetics, orthotics, and supply industry (6/1999); hospices (9/1999); Medicare + choice organizations (11/1999); nursing facilities (3/2000); individual and small group physician practices (9/2000); ambulance suppliers (3/2003); and pharmaceutical manufacturers (4/2003). 2, 6

OPPS Outpatient Prospective Payment System is the method of payment that CMS uses to pay for Medicare services delivered in a hospital outpatient setting.5

Prior Authorization Approval may be required before a medical service is provided. For procedures which require prior authorization, an insurer can deny coverage for services already provided or for proposed services which are deemed to not be medically necessary. It is generally the responsibility of the provider to obtain the authorization.1

Prospective Payment System (PPS)A standardized payment system implemented in 1983 by Medicare to help manage health care reimbursement whereby the incentive for hospitals to deliver unnecessary care is eliminated. Under PPS, hospitals are paid fixed amounts based on the principal diagnosis for each Medicare hospital stay. In some cases, the Medicare payments will be more than the actual cost of providing services for that stay; in other cases, the payment will be less than the hospital's actual cost.1

Protected Health Information (PHI)Individually identifiable health information:

  1. Except as provided in paragraph (2) of this definition, that is:
  • Transmitted by electronic media
  • Maintained in any medium described in the definition of electronic media at 162.103 of this subchapter; or
  • Transmitted or maintained in any other form or media
  1. PHI excludes IIHI in:
  • Education records covered by FERPA
  • Records described at 20 U.S.C. 1232g(a)(4)(B)(iv); and
  • Employment records held by a covered entity in this role as an employer
  1. That is or has been electronically maintained or electronically transmitted by a covered entity, or transmitted or maintained in any other form or media.2

Qui Tam Authorized by the False Claims Act, qui tam is an abbreviated term for "qui tam pro domino rege quam se ipso in hac parte sequitur," or "he who brings the action for the king as well as for himself."  A qui Tam suit is one filed by an employee of an organization, a whistleblower, with the federal government accusing an organization of fraud and abuse.2


Recovery Audit Contractors. As part of the efforts to fight fraud, waste and abuse in the Medicare program, the Tax Relief and Health Care Act of 2006 required a national Recovery Audit Contractor (RAC) program to be in place by January 1, 2010. The goal of the recovery audit program is to identify improper payments made on claims for services provided to Medicare beneficiaries.

RACs may review the last three years of provider claims for the following types of services:  hospital inpatient and outpatient, skilled nursing facility, physician, ambulance and laboratory, as well as durable medical equipment. Overpayments can occur when health care providers submit claims that do not meet CMS coding or medical necessity policies. Underpayments can occur when health care providers submit claims for a simple procedure but the medical record reveals that a more complicated procedure was actually performed.

Safe Harbors Explicit regulatory exceptions to otherwise legally prohibited conduct.  Federal safe harbor regulations specify certain joint ventures and other arrangements concerning hospitals and/or physicians which do not violate Medicare fraud and abuse laws.2

Stark Law (Self-Referral Statute)The Omnibus Budget Reconciliation of Act of 1989 (OBRA) bans physicians from referring lab specimens to any entity with which the physician has a financial relationship.  Amended by OBRA90 to exclude financial relationships between hospitals and physicians unrelated to clinical laboratory services.  OBRA93 (Stark III) expanded to include 10 other designated health care services.2

Secondary Payer A payer of medical benefits whose payments cannot be made until another, primary party has processed the claim and issued a claim determination.1

Unbundling Charging separately for items that should be billed together as a package or bundle.1

Upcoding Billing for a higher dollar service than what was provided.1


  1. Source: Trispan Health Services Website
  2. Source: Troklus, Debbie & Greg Warner. "Glossary of Compliance Terms." Compliance 101. Health Care Compliance Association. 2006 pp. 120 – 132.
  3. Source: CMS Website
  4. Source: Medicare Website
  5. Source: Medicare's Outpatient Prospective Payment System Glossary
  6. Source: Hospital Compliance Training