Certified Revenue Cycle Representative (CRCR) Practice Exam

Medicare will only reimburse for tests and services that are:

1. Constituting appropriate treatment and fairly priced

2. Supported by solid documentation

3. Demonstrated as necessary

4. Deemed reasonable and necessary

The correct answer is: Deemed reasonable and necessary

Medicare reimbursement is fundamentally based on the principle of what is deemed reasonable and necessary for the diagnosis or treatment of an illness or injury. This standard is defined by federal laws and regulations that shape the coverage criteria Medicare uses to evaluate services, tests, and procedures. When services are classified as reasonable and necessary, it means that they are appropriate for the patient's condition, conform to acceptable medical practice, and are not primarily for the convenience of the patient or the provider. This ensures that Medicare funds are allocated efficiently, contributing towards effective patient care while preventing misuse or over-utilization of medical resources. The other choices, while relevant to aspects of care or documentation, do not fully encompass the specific criteria used by Medicare for reimbursement decisions. For example, documentation must indeed support the necessity of services, and treatments should be appropriate and fairly priced; however, these criteria are subordinate to the overarching requirement of reasonableness and necessity that guides Medicare's coverage policies.