Medical billing is the process of submitting and following up on claims with health insurance firms in order to receive payment for services provided by a healthcare provider. Medical billing translates a healthcare service into a billing claim. The responsibility of the medical billing specialist in a healthcare facility is to follow the claim to ensure the practice receives reimbursement for the work the providers perform. A knowledgeable biller can optimize revenue performance for the practice.
The monetary health of a practice largely depends on the accomplishment of the billing office. Increasing demands on providers with decreasing reimbursement require healthcare offices to have highly skilled medical specialists. Understanding of medical insurance, the claims process, the appeal process, and the impact on the practice’s revenue gives the medical biller the tools to successfully optimize and maximize a practice’s revenue performance.
Healthcare providers that fail to streamline their medical billing process jeopardize the financial sustainability of their practice. By focusing on combatting common challenges in the process, however, they can increase their reimbursement and optimize their revenue cycle. Key obstacles in medical billing include:
Claim denial occurs when a claim is processed and then repudiated by a payer. Denials fall under five primary categories: soft, hard, preventable, clinical, and administrative. Most denied claims are preventable, and more than half of them are re-submittable once corrected.
Some healthcare providers continue to manually perform their denial management process, often resulting in increased human errors and reduced transparency. Even the smallest amount of inaccurate or incomplete patient information can result in a claim being denied.
Probably the number one source for denied claims is patient eligibility, meaning the service submitted for payment isn’t included in the insurance plan under which it’s being billed. Front-office staff must ensure they verify a patient’s health insurance status and coverage.
Manual claim processes are usually extremely time-consuming and increase the turnaround for claims. Healthcare providers that lack automation in their medical billing process miss out on the capability for advanced claims reporting and customized decision support.
Without technology to effectively prioritize, manage, and channel claims, physician practices are unlikely to be able to streamline their denial management and obtain revenue they’re owed by patients and payers. Even if a practice’s staff members are knowledgeable about the process, not having the applicable technology to administer claims makes it difficult to manage them efficiently.
The process of medical billing includes multiple steps, all of which play an important part in ensuring a physician practice receives the revenue it is owed. If any one of these steps are missed or done incorrectly, it can negatively affect the practice’s revenue cycle.
This step entails establishing financial responsibility for a patient visit and includes functions such as check-in and insurance eligibility and verification. A medical biller uses this information to collect any necessary co-payment and figure out which services the patient’s insurance plan covers.
After patient check-out, a medical biller is responsible for translating the report from the visit into diagnosis and procedure codes. He or she then performs charge validation and creates a superbill, which is an itemized form that details services provided to a patient and submitted to a payer for reimbursement.
After a medical biller creates a claim, reviews the codes used on it, and confirms it meets payer and HIPAA compliance standards, it is sent electronically to the insurance company for payment. The payer performs claim adjudication to evaluate each claim and accepts, rejects, or denies it before sending a report back to the provider. Any outstanding charges are billed to the patient for whom the claim was made.
It is the responsibility of a medical billing expert to generate a statement for patients who have an outstanding balance with the practice. The statement often is in the form of a detailed explanation of benefits (EOB). If a patient doesn’t pay his or her bill in a timely manner, the medical biller typically initiates a collection process.
Though medical billing procedures in the past used to be performed using paper-based methods and handwritten or typewriter-drafted documents, the emergence of numerous technologies in the healthcare industry has transitioned it to an electronic process. This has resulted in savings of time and money and reduced human and administrative errors.
Another transformation in medical billing is a change in focus to revenue cycle management (RCM). Whereas medical billing refers to the paperwork of filing medical claims for reimbursement, RCM includes a variety of additional services, including reporting and analysis of the financial pipeline and patient financial services. It consists of all the necessary tasks required to get a bill through, not only filling out and filing the paperwork.