In its current usage, medical billing refers to the submission of medical reports by healthcare personnel or doctors to insurance companies, for the purpose of receiving payment for consultations and services rendered to insurance customers. Whether the insurance company is private or government owned, the same processes for billing are used. Persons engaged in medical billing may acquire professional certificates as Certified Medical Reimbursement Specialists by taking the CMRS exam.

A medical billing expert creates bills from a log of each patient, which is kept in the files of the doctor attending the patient. This log is updated for all the visits that the patient makes to the physician and includes the date of the visit, the patient’s complaints, and/or the current illness being treated.

The patient log will also include any diagnosis and a possible treatment. It also includes a list of the physical examinations and/or laboratory tests which were conducted, based on the doctor’s preliminary diagnosis during a particular visit. The log then lists the results of each test and continues with the doctor’s interpretation of the test results, his final diagnosis, the prescriptions made and his recommendations for prophylaxis and maintenance.

The level of the service, as well as the verbal diagnosis, is transformed or translated into numerical code for the purpose of medical billing. Once translated, the claim is transmitted electronically to the insurance company or to a clearing house. In the past, all claims were submitted as hard copy, but today, only 30 percent of claims are still processed on paper.

Once the claim is in their hands, the insurance company has a board of medical specialists review and evaluate the claim based on the eligibility of the patient, the credentials of the provider and the necessity of the medical service. If, for any reason, the claim is rejected, it is returned to the claimant, or the doctor’s office, with an encrypted file stating the reasons for rejection. After decrypting the file, the claimant, if possible, makes the necessary adjustments to the claim and resubmits.

A full 50 percent of all claims are denied on average. This may be due to actual illegitimacy, errors caused by the complexity of the claims, and misinterpretation of diagnoses. Additionally, some insurance companies deny certain claims on the grounds that their contract does not cover such medical procedures.

Due to the inefficiencies seen in the process of medical billing, the Health Insurance Portability and Accountability Act was passed. The HIPAA prescribes a set of rules for health care specialists and institutions to follow in order to deliver their services appropriately and ensure that, in the process of medical billing, the privacy of the patient is not breached. Since 2005, the standards set by the HIPAA have been required of health care providers in processing and submitting their claims.

In this respect also, the patient’s records with the doctor no longer form the sole, or main, basis for any claims to be submitted to insurance companies. A medical billing specialist should be trained in all types of medical billing, have attention for detail, and good customer service skills. It is a mid-level paying job, usually with benefits. The advantages of medical billing careers are that the job can be done from home, and medical billing specialists are currently in high demand in today’s job market.