Imagine running your practice or company without billing guidelines. It would invite revenue losses, higher claim denials and federal penalties. Delivering quality patient care would become difficult. The medical billing process consists of multiple steps that play an essential part in optimizing your practice’s financial performance. And when paired with billing solutions, it helps you achieve revenue goals.

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If you want to streamline your billing operations, reduce invoicing mistakes and boost collections, you are at the right place.

We will cover the following topics in this article:

• What is Medical Billing?
• Key Steps in the Medical Billing Process
• Why Implement Medical Billing Software?
• Impact of COVID-19 on Medical Billing
• FAQs

What is Medical Billing?

Medical billing is the process of submitting claims on behalf of patients to receive payments for the services rendered by health care providers. Medical billers work in tandem with patients, health care providers and insurance companies. Coding is an essential part of medical billing. It helps generate detailed invoices. One incorrect code can result in claim denials.

Medical Billing vs. Coding

Medical billers and coders collaborate to increase collections. People use the terms coding and billing synonymously. But these terms differ in reality. Take a look at the table below to understand the distinctions between the two.

Medical billers and coders possess recording, interpreting and documentation tracking skills. Both billing and coding require meticulous attention.

Billing operations can be challenging. Just one mistake can negatively affect your practice’s financial viability. You will receive reimbursements from insurance providers only when you properly process bills. Incomplete patient information, inaccurate medical coding and missing documentation can disturb your company’s cash flow. Therefore, medical billing is a critical part of your organization’s revenue cycle.

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Key Steps

Converting patient notes into claims can be frustrating. Processing claims is no easy feat either. It can take months and several communications before you reach the collection stage. That’s why you need to build consistent workflows. Follow the key medical billing process steps mentioned below to speed up billing activities.

Step 1: Register Patients

The first step is to collect patients’ demographic and insurance information, including name, age, address, contact, policy number and insurance provider. Create checklists to ensure that you don’t miss gathering critical inputs. You should review intake forms before filing. Check for legibility issues and missing data, and pre-validate insurance information. Today, most practices use medical billing, EMR or EHR solutions to make data collection processes a breeze.

Patient registration can be a nightmare. Clients have to wait before they even receive care services. Implementing pre-registration techniques can assist you in improving the patient satisfaction rate. According to a survey conducted by Experian Health, 64% of providers observed that patients preferred an online or mobile-enabled registration experience. You can assign a new patient coordinator (NPC) to simplify registration procedures.

Step 2: Verify Insurance Plans

Insurance coverage differs from company to company. For example, most health plan providers don’t cover cosmetic procedures. That’s why it’s crucial to determine financial responsibility.

You can verify insurance eligibility in the following ways.

Contact Payers by Phone

Insurance representatives are just a dial away. Pull up data from patient files to find providers’ contact numbers. Confirm that you’re speaking to the right rep. In some cases, the rep might ask you to share information about your practice to ensure a HIPAA-compliant exchange. Once a secure connection establishes, the operator will release patients’ insurance details.

Today, health plan companies leverage an interactive voice response (IVR) system to help reps focus on other essential tasks. The IVR provides you with a menu of options that you can select via the touch-tone keypad. The system will route your call to a specific specialist or department if you need more details.

Search Online

Don’t want to spend hours on telecommunication? You can access online eligibility resources through payers’ websites. You might have to submit some forms or scroll through directories to find the right data.

Word of Caution: Sometimes, payer-supplied directories don’t contain updated information. Remember to cross-check details before filing claims.

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Leverage Digital Solutions

Some billing products enable you to perform real-time eligibility checks to allow you to inform clients about out-of-pocket expenses. We have highlighted the benefits of using software to verify insurance coverage below:

• Check multiple insurances simultaneously.
• Improve patient communication.
• Reduce denials.
• Increase collections.
• Cut administrative costs.

Web-based medical billing platforms such as DrChrono, CureMD, Kareo Billing, CareCloud Central and eClinicalWorks offer insurance verification functionalities.

Here are some things you can include in your verification checklist:

• Effective and end dates of the policy.
• Info about patient deductibles.
• Coverage limitations.
• Copay details.
• Documentation requirements.

Patients have a lot on their plates too. It might slip their minds to keep you in the loop about health plan changes. For that reason, you should re-verify insurance plans regularly.

Step 3: Create Superbills

A superbill acts as a detailed invoice outlining services rendered by patients. They can submit this bill to insurers for reimbursement purposes.

If the client regularly visits your practice, confirm the current information on their file. You should also ask for official identification such as a driver’s license or passport. You can collect copayments before or after the visit. It entirely depends upon your practice’s policy. Once the client checks out, you need to create and send the medical report to the medical coder. The coder will then translate the data into diagnosis and procedure codes. You can now generate a superbill consisting of the client’s demographic and medical and insurance data.

Step 4: Generate and Transmit Claims

After generating a superbill, you need to create a paper or an electronic medical claim. Don’t forget to check for coding and formatting errors to avoid denials. Each claim should contain the patient’s details and procedures data (CPT or HCPCS codes). Then, you pair these procedural codes with a diagnosis code (an ICD code), demonstrating the medical necessity.

Claims should also consist of insurance provider information listed through a National Provider Identifier (NPI) number. You need to follow the Health Insurance Portability and Accountability Act (HIPAA) and the Office of the Inspector General (OIG) guidelines. You can submit claims directly to payers or through clearinghouses. A clearinghouse reformats and scrubs claims for errors. Then they send them to health plan companies.

Step 5: Monitor Adjudication

Adjudication is the process where payers evaluate and determine whether the claim is valid or invalid. Insurance companies either accept, reject or deny claims.

Scenario 1 – If Payers Accept the Claim

Insurance companies accept valid claims with no coding, documentation or data entry errors. When they approve the claim, you will receive an explanation of benefits (EOB) statement. This document contains check details, policy number, patient’s and payee’s name, and services covered. Remember, the insurance provider will only pay the amount according to the policy agreement it has with the patient.

Scenario 2 – If Payers Reject the Claim

If a claim’s missing critical data or if it’s miscoded, it’ll be rejected and sent back to you. In such cases, you can make changes and resubmit the claim. You can file an appeal, asking the insurance provider to reconsider its decision. You have the right to request external review too. If a third-party reviewer decides to favor the client, the health insurance company will pay for the treatments or services rendered.

Scenario 3 – If Payers Deny the Claim

Insurance companies deny claims when a particular procedure isn’t included in the client’s health plan. In such situations, you can check the claim for mistakes and resend it to the payer. If the claim gets denied again, you will have to inform the patient about its financial responsibility.

Sometimes these procedures take longer than usual. That’s why you should follow up with insurance companies about adjudication statuses.

Step 6: Prepare Patient Statements

The statement is a bill highlighting procedures or services rendered by the client. You can also attach an explanation of benefits statement with the invoice to explain to patients the reasons behind covering and not covering specific procedures. Take a look at the table below to understand the difference between a billing statement and an explanation of benefits.

Step 7: Handle Collections

The final step is to mail statements to patients. If clients fail to pay bills within assigned deadlines, it’s your responsibility to initiate follow-up protocols. You can enlist collection agencies when it becomes challenging to handle collections. Do not forget to refer to your organization’s collection guidelines before taking any actions against customers.

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Primary Benefits

Scouring through a mountain of physical files to search for information is not only a tedious but also an error-prone task. And billing mistakes can invite troubles. It can hamper your organization’s reputation. According to a survey conducted by Inbox Health, some of the primary business challenges faced by medical practices are as follows:

• Insurance Reimbursement Challenges — 69%
• Administrative Tasks — 65%
• Rising Patient Payments and Responsibility — 57%
• Improving Patient Experience — 25%
• Shift Toward Value-Based Care — 17%
• Reputation Management — 12%
• Price Transparency — 10%

Medical billing solutions provide you with automated functionalities to simplify workflows and avoid accounting mistakes. They help you enhance productivity and achieve efficiency. Below we have highlighted the benefits of implementing a billing system.

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Streamline Processes

You can now send automated payment reminders, verify insurances and submit claims electronically with billing solutions. They enable you to reduce administrative burdens and save time. You can integrate with EMR and EHR systems to store data securely. Furthermore, you can generate and analyze reports to identify and resolve issues.

Minimize Coding Errors

It’s impossible for us to memorize hundreds of medical codes. Even if we could, there’s no guarantee that we won’t make mistakes. To err is human. AI-based billing apps enable you to scan documents and pull out vital information for coding purposes. They flag files needing additional review to assist you in submitting clean claims in the first go.

Boost Revenue

Tailored invoicing solutions can help your company reach its financial objectives. E-verification tools enable you to check the patient’s insurance eligibility with just a few clicks. Integrate with big data analytics systems to compare your KPIs with other health care practices.

Enhance Patient Experiences

Happy patients are the heart of practices. Billing platforms enable patients to schedule appointments, access critical documents and fill intake forms via the patient portal. They encourage clients to make digital payments. Communication modules allow you to follow up with customers to drive positive care outcomes.

Before implementing a billing app, you need to analyze your organization’s needs. You can conduct an internal survey and prepare a requirements checklist. This will enable you to make informed decisions. Read our medical billing buyer’s guide to kickstart your software selection journey.

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Impact of COVID-19

The COVID-19 pandemic changed the world in a dramatic way. Many industries, including health care, had to revise their plan of action to run their businesses. Several changes took place in the light of the outbreak.

• CMS made significant changes to the Medicare Physician Fee Schedule. As indicated by new rules, physicians can select evaluation and management codes based on the total time spent on the date of the patient encounter.
• Medical practices adopted digital strategies to establish efficient workflows.
• The Biden-Harris administration imposed the No Surprises Act to protect patients from paying out-of-network providers.
• The Centers for Disease Control and Prevention announced coding updates.

Providers had to face many obstacles due to the pandemic. Adjusting to new reimbursement policies and coding regulations was not an easy task. But there’s always light at the end of the tunnel. Several practices reassessed their financial plans to boost revenue.

Today, telemedicine solutions have become the need of the hour. According to a survey conducted by ASPE, telehealth utilization’s the highest amongst Medicaid (29.3%), Medicare (27.4%) and black (26.8%) respondents and people earning less than $25,000 per year (26.7%).

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FAQs

How To Improve Billing Workflows?

You need to verify patients’ insurance and demographic details frequently. You should also establish clear communication with clients about their financial responsibilities.

Don’t let denials demotivate you. Think of them as a learning opportunity. Tracking denials will help you update coding protocols and boost efficiency.

Develop training materials for staff to enhance claim processing. Nancy Rowe, the owner of Practice Provider, says, “A healthy revenue cycle begins with a well-trained front desk staff who have the tools available to check patient eligibility and benefits, and the ability to collect patient balances at the time of service.”

Should I Outsource Billing?

Outsourcing might or might not be the best option for your practice. It depends on several factors. For instance, outsourcing is your best choice if you don’t have access to skilled billers and coders. It enables you to submit clean claims and get paid faster. It also reduces administrative burdens and encourages employees to deliver quality care.

Sometimes, billing providers surprise you with hidden fees. So, it’s important to read contracts carefully. Lack of autonomy makes it difficult to oversee processes.

For the reasons mentioned above, conduct internal discussions before you decide.

Why Perform Billing Audits?

You need to perform billing audits to identify and resolve common errors and stay compliant. You can either run an internal or external audit. Most practices combine both for deeper checks.

What Are Different Types of Billing Systems in Health Care?

Health care billing platforms fall under three categories:

• Closed: Doesn’t allow you to transfer information to other clinics. For example, EMRs.
• Open: Enables you to transfer data across practices, facilities, medical professionals, etc. For example, EHRs.
• Isolated: Used and managed by patients. Not legally accepted. Commonly known as personal health records (PHRs).

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Final Thoughts

Generating bills is complex and time-consuming. It demands precision at every stage. Because medical billing directly impacts your practice’s revenue cycle, you need to be extra careful. Follow billing rules and standards to stay compliant. Keep up with the latest health care technology trends to improve patient experiences.

Computer-assisted coding and blockchain data storing capabilities can change the future of medical billing. They assist in reducing claim backlogs and boosting patient engagement. Implementing digital solutions can help you produce accurate invoices.

Does your company follow a different medical billing process than we have elaborated above? If so, what is it? Share your thoughts in the comments!