In its current usage, the medical billing refers to the submission of medical reports by healthcare people or doctors to the insurance companies for the purpose of receiving payment for consultations and services rendered to patients who are insured with them. Whether the insurance company is privately or government owned, the same processes for billing are resorted to. Persons engaged in medical billing may acquire professional certificates as Certified Medical Reimbursement Specialists by taking the CMRS exam.
The essential document or proof for medical billing is the log of each patient which is kept in the files of the doctor attending to him. This log is updated for all the visits that the patient makes to the physician. This log includes the date of the visit, the patient’s complaints or current illness being treated.
The suspicions of the physician are then mentioned. Next is a list of the physical examinations and/or laboratory tests which were conducted based on the doctor’s preliminary diagnosis, on that particular visit. The next section lists down the results of each test. The log 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 the medical billing. Once translated, the claim is then transmitted electronically directly to the insurance company or to a clearing house. In the past, all claims were submitted as hard copy, and today, 30 percent of claims are still processed on paper.
Once the claim is in their hands, the insurance company has a board of medical specialist 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, together 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 the 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.