An Introduction to Medical Billing

Let’s take a closer look at why we bill for medical purpose.

Going to the doctor may seem like a simple interaction between a patient and a doctor, but in truth, it is only a fragment of the big and complex system of information and payment. While the insured patient may have direct contact and interaction with one health care provider, that check-up is not so simple as it appears to be. Here is the necessity of medical billing which is in reality a triangular activity of 3-party.

1^st Party: Patient

2^nd Party: Health care Providers that include physicians, Doctors, emergency rooms, outpatient facilities, and any other places of medical services. The third is the insurance company or payer.

The medical billing services, negotiate and arrange between these three parties for the payment. Specifically, the biller makes sure that the healthcare provider is remunerated for their services by billing both patients and payers.

In this process, the biller brings together all of the information as in “superbill” about the patient and the patient’s procedure. Finally, they compile that into a bill and send it to the insurance company. It is called a claim and contains demographic information about the patient, including medical history as well as insurance coverage.

Let’s take a quick step back to talk briefly about the insurance process. Health insurance is against medical expenses. Put simply, people with health insurance pay a certain amount to have a degree of protection against medical costs.

Health insurance comes in several forms, including:

• Indemnity, or pay-for-service insurance, in which the patient may choose any provider they like.
• Managed Care Organizations (MCO)

This includes organizations like Healthcare Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs). Presently, this is the most accepted type of health insurance in the US today.

• Consumer Motivated Health Plans:

The consumers can choose a plan that fits his need. There are a lot of plans to motivate the consumers.

With each of these types of insurance, several measures and services are covered, while some are not. It’s the medical billing job to explain a patient’s insurance plan/s to create a perfect claim.