A Simple Guide to Efficient Medical Billing

The new changes in healthcare have created new challenges for patients and providers alike. Reforms like changes to medical billing rules and regulations and introduction of value and quality based compensation models can result in revenue losses.

Similarly, patients’ are having a hard time paying the bills. This decline is a result of patients experiencing an increase in both out-of-pocket costs and deductibles.

In order to tackle these financial issues and potential compliance risks, practices will have to implement a more proactive strategy to their medical billing processes. By controlling these key issues, healthcare practices can increase revenue, ensure reimbursements, so they can continue to provide quality care to their patients.

Let’s take a look at some steps every healthcare practice should take for efficient medical billing:

Set a Step-by-Step Medical Billing Collections Process

All medical practices require a clear collections process to maintain a steady financial system that generates revenue. A step-by-step approach to managing collections will help clarify the process to all parties involved. This will improve revenue cycles as patients are thoroughly informed about their responsibilities.

All collections processes should follow these steps:

Set Clear Terms

Keep patients informed about paying their debts. Share details about their payment responsibilities mentioned in the ‘new-patient’ paperwork with regular reminders of their obligations.  

Keep Complete Records of Patients

Know everything there is to know about the patients. Organize and maintain a complete record with patient’s current address, cell phone number, email address, etc. It is crucial to obtain a photo ID of the patient during their first visit as that ID may be vital if a bill is required to be sent to a collections agency later on.

Verify Contact Information

Keep updated information of patients’ address and contact information. It is important to keep check of patients so no time nor money is wasted in sending mail to outdated addresses or calling invalid phone numbers.

Patient Consent for Automated Text Messages/Voicemail Reminders

Always include an agreement specifying for message and call reminders regarding billing matters in the patient paperwork.

Inform patients About Co-Pays

It is important to inform patients about their co-pay as it is vital. Ensure that the staff is well-informed in answering any inquiry a patient might bring up.

Regularly Verify Eligibility

Always verify patient eligibility and check their insurance card on every visit to avoid any claim denials. There are automated verification systems such as Real Time Eligibility verifications that can do the same job to reduce labor costs.

Upfront Collection

Avoid the hassle of paperwork by collecting co-pays upfront.  Always collect balances due based on the deductibles instead of chasing it later.

A Clear Payment Plan

Establish a sound payment plan to present before the patient. Be it credit card, cash or checks, make sure the patient is informed about what payment options are available.

Send Out Letters In Advance

Write a sequence of letters to send out to patients when their bill is coming due, is overdue, or is about to be sent to collections. Some people need several reminders before acting, and a physical letter carries more psychological weight than a voicemail message.

This may seem like a time-consuming procedure, however, setting up an efficient collection process will allow healthcare providers to receive timely reimbursement and reduce patient delinquency due to lack of knowledge or communication.

Properly Manage Claims

Insurance companies are strict when it comes to medical billing and coding practices because all medical bills are likely to contain errors. Any error found results in rejection. The task of editing errors and resubmission of bills can be time-consuming. This disrupts the financial stability as providers may go months on end without receiving their due service payments.

Common Errors

Thus, it is important to accurately input complete information and double-check claims for errors prior to submission. The most common types of error found in claims are:

  • Incorrect patient details
  • Inaccurate provider details
  • Invalid insurance details
  • Incomplete documentation
  • No Explanation of Benefits (EOB) on denied claims.
  • Missing claim number references on a denied claim
  • Missing or unclear codes

In order to reduce billing errors, ensure double-checks on claims prior to submission or notify providers if the provided information is incomplete, unclear or inconsistent. After submission of a claim, make sure to check up on its processing with the insurance company’s representative as well as keep on changing the real time status by going through claim acceptance and rejection responses.

Double Check EOB

Aside from the errors listed above, make sure to check the EOB attached before resubmitting a denied claim. This can make it difficult for the insurance system to identify the errors. In such cases, call a representative of the insurance company to send the EOB and clarify what portion of the claim is problematic.

Reduce Coding Errors

Coding is an essential part of medical billing. It is the job of a medical coder to describe the procedures performed on a patient using standardized codes and explain the coding guidelines to the providers. This makes the claims to be decipher and processed with ease.

Common Coding Errors

Although this is a standard method, errors are likely to occur. Clearinghouses track missing or incorrect codes but some common errors are hard to spot.

Non-Specific Diagnosis Codes

Due to stringent requirements, the most common error in medical billing are non-specific diagnosis codes. This is collecting information about a patient’s condition that was not documented by the clinicians or providing update on their condition.

Incorrect Modifiers

A common factor for lost reimbursement is incorrect usage of modifiers. Modifiers depend on the demands of the payer as provider will not receive reimbursement if there is a wrong modifier on a claim.

Upcoding and Undercoding

Aside from these frequent sources for coding errors, the most problematic ones are up coding or under coding. These are either accidental or intentional.

Up Coding

This is the addition or exchange of certain codes with the ones used for a more expensive procedure. This can happen by accident as a result of miscommunication between the provider and the coder; or it can be intentional, which is a criminal act.

Under Coding

Similar yet opposite to up coding, this is the omitting or exchange of codes with the ones used for a less expensive procedure. This is either due to lack of communication between the provider and coder, or it is illegally done by the provider.

Always make sure to double-check for coding errors before any claim submission. If the procedure details are vague, inconsistent or contradictory, contact the provider prior to assigning a code. Otherwise, cross-check with the medical coding resources to ensure the correct code.

Swiftly Deal With Rejected or Denied Claims

Before we get into the nitty-gritty, it is important to know the difference between a denied claim and a rejected claim.

Rejected Claim

A rejected claim is the one that is not yet processed due to one or more errors found in the claim. These errors prevent the insurance company from paying the due bill.

Denied Claim

On the other hand, a claim is denied if the insurance company has deemed the claim to be unpayable after processing. This is due to a violation of the patient–payer contract found or maybe an error found after processing.

In both the cases, the payer will have to return the claim to the biller, explaining the problem. While a rejected claim can be resubmitted after corrections, a denied claim is appealed before it is resubmitted — a long and costly process.

Check for errors to reduce chances of rejections or worse denials. However, in any case, it is important to handle the issue promptly. Stay in touch with the payer or their representative so they can help resolve the problems found in the original claim — providing accurate and up-to-date information on a current claim during processing. This helps to improve the claim editing procedure and reduce re-submission and appeal time.

There is Always Room for Improvement

The healthcare industry is always changing and it is vital to stay ahead of the curve. Practices should track of their billing company’s performance and keep up with the latest trends in healthcare regulations to find problematic areas to improve revenue and efficiency. For optimum performance and efficiency, practices should do three things:

Keep a Close Eye on Pending Accounts Receivable

Outstanding amounts owed to healthcare providers is something that needs constant follow-ups to understand the effectiveness of the collection process. Comparing figures from previous years and tracking quarterly amounts are an excellent strategy to manage the performance of a practice’s revenue cycle. This kind of analysis helps to identify the potential impact of any implemented procedures.

Stay Informed

The rules for medical billing are always changing. Keeping up with the trends require training and education. It is better to train the staff so they can stay top of the constant changes to medical billing and coding protocols.

Spot the Problematic Accounts

Set up a clear process of managing patient accounts so that data is easily made available for identification of any potential errors. Implement methods for tracking troublesome behavior such as constantly declined payments, sporadic changes in contact details or late payments. This helps to identify patients that require additional billing reminders.

Consider Outsourcing

While these steps help in implementing a proactive approach to medical billing, many healthcare practices often find themselves lagging behind. This is mainly due to the time, expenses and labor spent on catching debtors, editing and resubmitting claims as well as keeping up with latest trends and regulations. All these duties tend to exhaust even the most efficient medical practices.

In order to cut hefty costs, many healthcare providers are outsourcing their medical billing and coding duties to third-party experts — For many, this is a cost-effective solution to increase revenue and improve efficiency.

Count on MediFusion to Take Care of Medical Billing and Revenue Cycle Management

Consider outsourcing your medical billing to MediFusion. Feel free to ask our clients, why we’re one of the top medical billing and coding companies in healthcare. We are experts in the intricacies of medical billing to improve your revenue cycle management. Find out more about outsourced billing management benefits by speaking with one of our experts.

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