Medical Billing Process Explained

You might have heard of the medical billing and coding process somewhere. In fact, it is one of the most important terminologies in the healthcare industry. Medical billing process involves translating the service provided by a healthcare institution into a claim. So, a medical biller plays quite a crucial part in a health care institution. The person has to follow the billing norms precisely to make sure that the medical practice receives adequate reimbursement for the service or work performed. 


An expert biller will be able to optimize and enhance revenue performance for the institution. To put it simply, medical billing process involves some sort of a communication between the medical services provider and the patient’s insurance company. However, this comes under a billing cycle, and so, it may take anything from a few days to a couple of months to complete. Consequently, the biller may need to act as a liaison between both the ends until the cycle completes with a resolution reached.


The Process


The whole thing starts right when the patient visits the healthcare institution. The key steps involve updating the medical record of the patient and summarizing various aspects concerning the diagnosis, treatment and any other relevant information. Thereafter, the updated information is recorded electronically and maintained in the database for future updates and reference.


Then the services rendered are analyzed and a five-digit procedure code is assigned. This code is assigned from a database of standard procedural jargon. Next inclusion into the record is the verbal diagnosis, which is also assigned an additional numerical code. These codes have an important purpose, as they are mainly used in insurance claims during the medical billing process.


Then comes transmitting these assigned codes to the relevant insurance companies. This usually done electronically, with an ANSI 837 file. The code is transmitted directly to the insurance company, where the claim is then processed.


There are medical claims experts and examiners who have the job of processing the claims. However, when more money is involved, a medical director will come into picture for evaluating the validity of the claim. When the claim is approved, the healthcare institution or the medical service provider will receive the money based on pre-negotiated rates.


In case the healthcare provider receives a rejection of claims during the medical billing process, they will require reassessing and reviewing the message, reconcile, make required alternations, and resubmit the claim. Actually, this exchange may happen many times until reimbursement is completed.