How does the life cycle of a medical bill begin?

Medical billing is a cascade of events, including patient registration/encounter, insurance verification and eligibility, treatment/procedure performed, documentation, document review by a medical coder, billing being done accordingly, claims submission, payment posting, denial management (if applicable), and then the patient is billed.

Patient enrollment & registration

At the very start, the patient schedules an appointment, and demographics are gathered. Insurance information is collected. Consent forms, including HIPAA, etc., are filled out and signed. Patient enrollment and registration is the initial step of medical billing in which the concerned patient is registered for a medical appointment and billing. It is done through integrated EHR and EMR billing software, in which administrative staff are responsible for handling enrollment and registration, leading to a streamlined billing process. Accurate patient demographics, medical records, insurance, and related information are the key components for the first step.

Insurance verification & eligibility assessment

Insurance coverage, policy effective dates, and other details are verified and confirmed. It is the step in the billing cycle in which the patient’s insurance type, coverage plan, and other related information are covered, which is followed by eligibility verification done by the billing team, leading to a smooth billing procedure. Inaccuracy in the claim can lead to improper claim submission, which can eventually contribute to rejections or denial by the insurance company, affecting the whole billing system.

Do the claims get denied because of inaccurate eligibility? Yes, claims are often rejected in cases of inaccurate insurance, ineligibility issues, delayed payments, and increased final stress.

Treatment/procedure performed.

The patient, after being seen by the doctor/medical staff, is discharged when all the procedures, services, or tests are done. After initial registration and verification, appointments are scheduled with the respective provider, who is liable to render the services involving treatment, therapies, medication management, and others based on patient conditions. All the appointments are managed through billing software. 

Documentation 

After all the processes, it is documented by the provider; the document must have all the details of the services performed. Precise and absolute documentation is necessary for coding, serving a key role in the whole billing process for proper reimbursements. Here is some important information that is commonly documented and recorded for coding and billing purposes. It covers:

Component	Details
Patient Info	Name, DOB, insurance
Complaint	Reason for visit
HPI/PMH	Condition history, meds
Exam	Physical findings
Diagnosis	ICD-10 code
Procedures	CPT/HCPCS codes
Plan	Treatment & follow-up
Signature	Clinician verification

Medical charts reviewed by a medical coder!

A medical coder, after careful consideration of the documentation provided by the provider in the form of SOAP notes or forms, receives and analyzes it, in which the diagnosis and procedure or services are the primary focus for coding. Convert the data into codes, which are used to code the medical charts through four major types:

• ICD-10-CM for diagnosis, covering medical conditions relevant to the patient encounter
• CPT for procedures or services rendered against the concerned condition
• HCPCS for supplies, drugs, or other items for which CPT codes are not available
• POS (place of service) represents the location where the service is being rendered
• Modifiers to add additional information are used along with ICDs, CPT, and HCPCS

All these were done to ensure compliance with coding guidelines.

Charge entry & claim generation.

Now, the patient data, which was previously documented and converted into codes by a medical coder, is charged by the biller, and the claim is generated. The assigned codes are converted into charges according to the doctor’s fee schedule and charges for services provided over time and history. After that, the charges are reviewed for accuracy, and a further claim is generated for submission to insurance.  

Accurate claim submission!

The claim, after accurate coding of CPT and ICDs, is led to claim generation by the biller and submitted to the relevant insurance company for reimbursement. The claim is submitted in the forms, i.e., CMS1500 and UB-04, for office or hospital, respectively. Claims are sent to the insurance payer for payment, eventually resulting in timely reimbursement of the claim. All the above steps need to be accurate for a smooth claim submission. 

After claim submission, the claim is processed for payment, so it undergoes review by the insurance before payment is released. The insurance is responsible for releasing payments after design, whether the claim is up to mark for reimbursements or lacks any important information.

Effective denial management

In case of any denial, identify the denial reason and review the explanation of benefits (EOB) or electronic remittance advice (ERA). It might be some incorrect code errors or a missing. For this management, correct the errors and obtain the missing ones. The claim is submitted to the insurance for reimbursement within the deadline provided by the payer. Denial management is not only resubmitting claims but also ensuring correct billing and eventually minimizing denials or rejections by the payer.

Payment posting

In this part, payment is received by the insurance payer, the EOB is reviewed, the insurance amount is paid to the patient account, and adjustments are applied. Payment posting is done to ensure the patient’s accurate account balance, help identify denials and errors, and, lastly, ensure accurate financial flow.

Final verdict!

Billing is a comprehensive process in which multiple steps are involved, in which accurate documentation, coding, and other things are crucial for optimized reimbursements. Both in-house and outsourced follow the same steps to get payments from the insurers, while outsourced has more perks than the in-house one, delivering efficient service at an affordable cost. Want to know the best one? CUE Claims is the best of all the serving elevated billing services with customization according to your needs.

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