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Medical Billing 101

October 5, 2022Gables Medical BillingUncategorized

A claim is often considered the most valuable source of data and information for a healthcare company or organization. All of the claims that are submitted to payors contain procedure information and diagnosis information to make the patients’ visit billable. But, what is a medical claim? In layman’s terms, this is a bill that a healthcare provider submits to a patient’s insurance provider, it contains the medical codes that detail the care administered during the patient’s visit. These codes describe the services the provider administered when seeing the patient. These often include:

  • A diagnosis
  • Procedure
  • Medical supplies used
  • Medical devices used in the treatment
  • Pharmaceuticals
  • If medical transportation was used
  • Details of condition and if there is a need to follow up

In the claims submission process, all relevant medical coding and corresponding charges are included. The insurer will assess all medical codes and diagnoses to determine if the provider will be reimbursed and how much to pay for their services. So, what does the medical claim look like? And, what information does it contain? In simple terms, it contains details specific to the patient and their encounter with the provider. This is usually split into two areas, the claim header and claim detail.

Claim Header

  • The information here will summarize the most important information in the claim.
    • Patient name
    • Patient date of birth
    • Patient gender
    • Address information
    • National provider identifier (NPI) for provider
    • The diagnosis code
    • In-patient procedure (if applicable)
    • The diagnosis-related group
    • The insurance company or payer that the patient subscribes with
    • The overall charge for the claim

Claim Detail

  • This area includes information that relates to secondary procedures and related diagnoses during the hospital stay. Every single secondary diagnosis has the following information:
    • Date of service
    • Procedure code
    • The corresponding diagnosis code
    • National drug code, if administered
    • NPI for attending provider
    • The overall charge for services

That’s a lot of information to take in, but there’s also an entire process that follows a medical claim. What is the medical billing process? There are several steps in the revenue cycle that must occur to result in reimbursement.

  1. Patient Registration – This is the kick-off to the medical billing process, and step one in the revenue cycle. This happens when the patient communicates with their provider personal details, be it a yearly visit, or visit because of feeling ill and their insurance information.
  2. Insurance Eligibility Verification – The patient is registered and the provider must now confirm their insurance is active and their coverages are adequate. They must also confirm the policy benefits, if there is a co-pay due on the day of the appointment and if pre-authorization is required under their policy.
  3. Medical Coding – Then the show really begins, this is the most vital part of the process that occurs after the care has been administered, commonly the most critical things that are included in this part of the process are: Diagnosis-related group, current procedural terminology, healthcare common procedure coding system, international classification of diseases, national drug code. The codes help providers really describe the patient’s overall condition coming into their appointment, which is vital in reimbursement for treatment.
  4. Charge Entry – The step before submission to the payors, if you’re working with Gables Medical Billing this is where our medical billing specialists would list the charges for reimbursement.
  5. Claim Transmission – In the transmission of the claim to the payor, it must be formatted to the specifications of the patient’s insurer, which will result in a faster reimbursement process. If you are dealing with a high-volume payor, like Medicare and Medicaid the bills can be transmitted directly to them. This usually aids in reducing the time it takes to receive reimbursement.
  6. Adjudication – Once the payor receives the medical claim it is evaluated and then the insurer will decide if the claim is valid, and how much of it will be reimbursed. If the claim is accepted the payor issues the reimbursement to the provider. But, if the patient has insufficient coverage the payor will deny the claim, the same goes for failing to get pre-authorization for services. The payor can also reject the claim, this could happen for several reasons. The most common denial reasons are unmet formatting requirements or errors in medical coding. If a claim is rejected it can be resubmitted once the errors are corrected.

The Gables Medical Billing team of medical billers is ready to handle all claims submissions, follow-ups, appeals, and payment postings with the dedication that your revenue cycle demands.

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About GMB

Gables Medical Billing has adapted to the ever-changing medical billing environment, modifying and adding to its services to proactively meet the needs of its clients.

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Recent Posts

  • Managing Costs with Medical Billing Specialists
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