Exploring the Fundamentals of Medical Insurance Billing

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• Exploring the Fundamentals of Medical Insurance
  Billing
• Every healthcare organization should have a clear
  understanding on how to proceed with medical
  insurance billing. But to do it correctly, it is
  important to understand what medical claims data
  means. From this article, you will figure it out.
• What Exactly is a Medical Claim?
• Medical claims are the bills that healthcare
  organizations are submitting to insurance
  providers of their patients. Every medical bill
  has unique medical codes. They refer to the
  level of treatment offered to the patients during
  their visits. In other words, medical insurance
  billing codes can include
• Detailed diagnosis of the health condition
• Treatment procedures followed
• Medical devices used
• Medical supplies used
• Medical transportation used
• Pharmaceuticals provided
• When a healthcare provider is submitting a claim
  to an insurance company, they need to include
  all the medical codes relevant to the visit. Then
  the insurance company will be able to evaluate
  the codes and proceed with offering
  reimbursement.
• Exploring Information Available Within a Medical
  Claims File
• For every patient encounter, a healthcare
  organization should open up a medical claims
• file. It contains confidential information about
  the patient such as the name, gender, birthday,
  and address. This file contains two main parts.
  They include
• Claim Header
• Claim header contains a summary of the claim. It
  has information related to the patient as below.
• Name of the patient
• Birthday

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• Procedure code
• Date of offering patient treatment
• National Drug Code (NDC)
• All corresponding diagnosis codes
• NPI number of the attending physician
• Overall charge for the service
• Learning About Medical Claims Clearinghouse
• Medical claims clearinghouse is the electronic
  platform that facilitates payors and healthcare
  providers. All the healthcare providers should go
  ahead and submit medical insurance billing
  information to a clearinghouse. Then the
  clearinghouse will standardize and screen all
  the medical claims. The payor will get
  information only after that.
• One of the main purposes of a clearinghouse is to
  remove errors during medical coding. It can also
  reduce the time that it will take for a patient
  to receive reimbursement.
• Moreover, it can be beneficial for the payors as
  well. Thats because the payors can get
• medical insurance billing records in a
  standardized format. The payors will not have to
  do any formatting on their end. They will be able
  to go ahead with the reimbursements without an
  issue.
• Read Also-What Does a Medical Billing Expert Do?
• Understanding the Medical Insurance Billing
  Process
• The overall medical billing process is made out
  of seven important steps. All these steps
  capture the overall claims journey from the
  moment a patient checks into a healthcare
• facility, until they get their bill from the
  insurance provider. Lets explore the steps in
• detail.

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• Medical coding is one of the most important
  pieces of information you can find in a claims
  request. All healthcare providers should
  transcribe clinical documentation along with
  their notes to standard medical codes. Below are
  the most prominent medical coding systems
  available as of now
• Current Procedural Terminology (CPT)
• Diagnosis-related Group (DRG)
• International Classification of Diseases (ICD-10)
• Healthcare Common Procedure Coding System (HCPCS)
• National Drug Code (NDC)
• From these codes, it is possible to explain the
  medical diagnosis, medical procedure, and even
  prescriptions offered to the patient. In other
  words, it clearly describes what the patients
  overall condition is about.
• Patient Charge Entry
• Charge entry refers to the final step before the
  healthcare providers go ahead and submit their
  claims. This is where they include all the
  charges that they are expecting to receive.
• Claims Transmission
• Claims transmission would happen once the claims
  get transferred to the payor from the healthcare
  provider. This is where the clearinghouse
  involvement takes place as well. It will review
  and reformat all information before submitting to
  the payor. There are situations where the
  healthcare providers submit their claims directly
  to the payors as well.
• Adjudication of Claims
• After the payor reviews the medical claim,
  adjudication will happen. This is where the
  payor can evaluate claim and decide whether it is
  valid. The payor will also decide the amount to
  reimburse during this stage. Once the claim is
  accepted, the payor will go ahead and provide
  reimbursement to the healthcare provider.
• Along with that, the payor will also charge
  remaining amount from the patient. In case the
  patient doesnt have sufficient coverage, the
  payor can deny the claim. This is where a
  patient will have to go ahead and submit an
  appeal.