An Inside Look at Medical Billing

Medical BillingMedical billing is the process of billing patients and insurance companies for services rendered by a healthcare provider. The process requires a lot of work between the biller and the payer, and involves many people, including front office administrators and back office staff. It entails a lot of communication, which begins at the office visit and the collections process.

Understanding Charges and Claims

Apex EDI, a provider of electornic claims processing solutions, observes that most health care providers have no idea about the medical billing process because a.) Many doctors don’t process their own billing, and b.) Insurance companies pay based on their own algorithms. This is why sometimes, health care providers receive radical amounts for services they have rendered.

For example, if an insurance company charges $200 for a physical check-up, the doctor will only receive that amount even if he charges the patient $250. Insurance companies call this a maximum payout, or the amount they set for certain medical services.

The medical billing process is always a negotiation between the biller (health care provider) and the payer (insurance company). Sometimes, doctors will receive the amount they expect, while sometimes they will receive less.

Dissecting the Medical Billing Process

As a health care provider, it is important that you completely understand the medical billing process. Here are the six basic steps of medical billing that you need to know.

Patient Check-In. During this stage, the patient will declare his complete information and insurance details, including the payer’s name and policy number.  All the information gathered during this step is necessary in a billing claim.

Insurance Eligibility and Verification.  Health care providers will check the eligibility of the patient’s insurance, and determine any changes in the patient’s insurance information.

Coding of Diagnosis, Procedures, and Modifiers. Insurance companies will check the diagnosis of the patient, as well as the method of treatment he will receive. To assess the procedure accurately, insurance companies use programs like CPT and HCPCS code modifiers.

Charge Entry. Health care providers will determine the charges for the services they have provided. This also includes the appropriate linking of medical codes rendered during the patient’s treatment.

Claims Submission. When all the charges are complete, the health care provider will submit their claims to the insurance company. The payer will double-check all the payments he owes to the health care provider.

Payment Posting. This last step involves the posting and depositing of the payment. Health care providers will receive the amount they submitted as claims to the insurance company.

Medical billing is a tedious process, but health care providers can obtain many benefits from it, especially when they understand the whole procedure.