Medical billing services involve submitting and tracking healthcare providers' claims for reimbursement of services rendered in a healthcare context. Medical billing services assist healthcare providers by conducting accurate coding for diagnoses and procedures and maintaining documentation in accordance with payment criteria. The service will also timely submit the claims to the health insurance companies so the practice receives maximum reimbursement.

Medical billing can occur in-house, or the provider's practice will make a contract with a specific company for the billing services. The company will have a full revenue cycle management (RCM) of all billing services, which could include patient billing, verification of insurance benefits, and denials management. Medical billing is an important part of the financial viability of a medical practice or hospital.

Key Functions of Medical Billing Services

• Prior Authorization

In medical billing services, the prior authorization process is extremely important. This is where healthcare providers have to get the approval of a patient's insurance company before they can provide certain medical services, procedures, etc., or prescribe certain medications. The purpose of this is to show that the treatment prescribed is medically necessary and can be billed under the patient's insurance plan. If they do not obtain prior authorization, it is possible that the claims will be denied, which at the very least leaves patients with unexpected bills, and will hold up or even possibly leave providers without payment for their treatment.

• Data Management

Data management in medical billing services is the accurate collection, organization, storage, and protection of patient and billing information throughout the entire revenue cycle. Good data management will ensure that all records are kept up to date and compliant to regulations - like HIPAA - which includes all information regarding the demographic details of patients, insurance information of the patient and/or provider, treatment codes, payment, etc. Good data management can help provide accurate claims submissions in a timely manner, lead to faster reimbursements for the provider, enhancing overall operational efficiency and minimizing errors and claim denials. A data management system is essential for correctly managing sensitive healthcare information, including both security and integrity of the data.

• Insurance Verification

Before providing medical care for the patient, the billing service verifies the insurance benefits of the patient. This is to see if the insurance is active at the time of care, what the policy covers, the patient’s co-pays, or if the patient’s deductible is met. It may also verify if the procedure needs pre-authorizations or referral in some cases. When the insurance verification is carefully completed, it minimizes claim denials and gives the patient an understanding of their financial obligation prior to providing care.

• Medical Coding

After the patient is checked, all medical services and medical diagnoses are coded with a standard coding system. The billing service normally would utilize the ICD-10 codes for all medical diagnoses and then either CPT or HCPCS coding for the services provided. The coding is double checked to determine if there is an appropriate code for everything that is included in the clinical note. Modifiers are used if necessary, and any changes made to the codes are taken note of. Having accurate coding is important to let the insurance company know what service was completed and to ensure reimbursement for those services.

• Submission of Claims

After coding the services, billing services prepare and submit the claims to the insurance company. This involves verifying that the claims have complete and accurate details, attaching any required documents, and filing the claims electronically with the lender. It is vital for providers to submit clean, error-free claims within the payment window provided by their insurer to avoid delays, prevent claim rejection, and maintain a steady revenue stream for the provider.

• Payment Posting

Billing services will post insurance payments to the patient ledger when the patient receives payment. This means the billing service is verifying the Explanation of Benefits (EOB) or Electronic Remittance Advice (ERA) produced by the payer. It is to assess payments, clean claim adjustments, and any balances related to services provided. Billing teams may need to identify and research underpayments or missing reimbursements to maintain accurate financial books. Timely and accurate payment posting is crucial for tracking financials and revenue analytics.

• Dealing with Denials

If a claim is denied, the billing service will investigate that claim and determine how to fix the claim denial. They will review all aspects of the claim to determine if the claim was denied for coding issues, eligibility denials, missing information, or some other issue. Once the source of the denial has been identified, the billing services will initiate the necessary adjustments or appeals. Successful denial management will recover lost revenue and enhance the overall percentage of claims in favor of the patient or provider.

• Patient Invoicing and Collections

After the claim is processed by the insurance company, and the carrier paid the balance, the patient is billed for the remaining amount owed. The billing department will provide the patient with an accurate and clear statement of what was paid for and what the patient owes. The billing office may offer payment plans if the patient cannot pay the balance due, and if necessary, bill collections could follow up for unpaid balances either internally or through an external company.

Why Outsource Medical Billing?

• Decrease Billing Errors and Denied Claims

Billing personnel frequently work on multiple services. This can lead to human error in medical coding, documentation, or the submission of the claim. Additionally, incorrect modifiers or missing information can result in a claim being denied or payment being delayed.

Outsourced billing companies have certified coders and billing professionals who spend their complete energy and focus on getting things right. Billing companies build in quality controls early in the billing cycle, thus creating fewer denied claims and reducing time. As a result, the claims are cleaner, approvals are faster, and providers have a better idea of expected revenue.

• Accelerate the Claims Process

Every time a claim remains unprocessed, the practice is kept waiting much longer for payment. Anytime there is a delay in payments, cash flow is hampered, and the practice is unable to commit to reinvesting in operations or patient care.

A good outsourced billing company is more efficient and can process claims quickly than in-house billing staff. An outsourced billing team is more diligent in tracking each claim, will consistently reach out to payers every single time, and is able to react quickly when issues arise. This will effectively lower the time to receive reimbursement and allows providers to better align capital with the operating needs of the practice.

• Access to Expertise

Medical billing and coding continue to become more complex due to regular updates to ICD-10 and CPT codes, payer requirements, and regulatory compliance.

Outsourced billing teams have individuals who are trained in billing and coding services that follow laboratory billings and pharmacy claims closely. This ultimately leads to improved pathways to accepting claims, receiving proper reimbursement, and ultimately reducing liability to the practice for compliance.

• Focus on Development and Growth

As medical practices expand, the demand around billing changes. Managing this growth internally means hiring personnel, upgrading systems, and increasing administrative oversight.

Outsourcing allows for instant scalability. A billing partner can seamlessly transition with the increased volume. This kind of adaptability provides exactly what is needed to focus on development and growth without sacrificing billing operations.

• More Time Engaging with Patients

Physicians, nursing staff, and front office staff members are engaged into issues relating to patient billing, and have less time to devote to the patient experience and clinical care.

Outsourcing patient billing can provide more time and focus to the patient. This will allow improving the quality of service, patient experience, and better clinical outcomes.

What to look for in a quality medical billing platform

• Designated Account Managers

A reputable billing partner will provide a designated account manager who is knowledgeable about the practice’s specific patient requirements. This will facilitate direct communication and issue resolution.

• HIPAA-Compliant Processes

When applicable, selected healthcare providers and their organizations should also maintain HIPAA compliance throughout the entire claims' adjudication process. EHRs should be secure; confidentiality and security of information should be protected while in transit, and when not in transit; we should only communicate sensitive patient information to those with a need to know; and we should have cyber protection. Complying with HIPAA requirements helps to ensure that the desired patient confidentiality and trust is not only achieved, but maintained; protects against fines and penalties; and minimizes costs associated with defending against wrongful disclosure or breach.

• Unique to Each Type of Practice

Each healthcare provider operates in a unique billing system or workflow; therefore, the outsourcing partner should customize the services to the specialty code and structure and aim to improve effectiveness and efficiency. Medical billing services assist medical providers in streamlining billing operations and reducing administrative burden and costs while improving the financial well-being of the practice. With credible, experienced billing professionals, a practice can limit billing errors and appeals while billing claims accurately and in compliance with payer rules.

Outsourcing billing can also be a way of scaling the practice and a way for the practice to focus on improving patient care. A reliable billing company saves time, supports long-term planning, and strengthens your organization’s stability. It also prepares your practice for the increasing complexity of the healthcare industry.

By outsourcing services, they can save about 80 percent of providers’ operational costs with just $7 per hour rates. These vendors also offer specialty-specific billing services. They offer excellent end-to-end RCM services. Hence, urgent care centers being free from administrative burdens can further enhance their patient care efficiency.