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Joy Hicks

Term of the Week: Adjudication

By March 30, 2011

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The Medical Office Term of the Week is:


Claims Adjudication refers to the determination of the insurer's payment or financial responsibility, after the member's insurance benefits are applied to a medical claim.

When claims are processed, the payer will notify the provider of the details of the adjudication in the form of an explanation of benefits or remittance advice.

For claims that have secondary or tertiary insurances, the primary payer's adjudication information must be forwarded for the coordination of benefits. This information should include:

  • Payer Paid Amount: the dollar amount paid by the payer
  • Approved Amount: the approved amount equals the amount for the total claim that was approved by the payer
  • Allowed Amount: the allowed amount equals the amount for the total claim that was allowed by the payer
  • Patient Responsibility Amount: the amount of money that is the responsibility of the patient which represents the patient copay, coinsurance, and deductible amounts
  • Covered Amount: the covered amount equals the amount for the total claim that was covered by the payer
  • Discount Amount: the dollar value of the primary payer discount or contractual adjustment
  • Adjudication date: the date the claim was adjudicated and/or paid


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