What Is Medical Billing?

Medical billing is the process of creating insurance claims & bills for patients using medical codes extracted from the medical coding process. Medical billing claims are precisely generated & collected through accurate patient registration & confirmation of patient financial responsibility. Medical billing, in conjunction with medical coding, uphold & lay the groundwork for revenue cycle management, generating cash flow for the medical practice or hospital. 

Medical Billing within Revenue Cycle Management

Proper & efficient medical billing is crucial for a medical practice or hospital to receive payment. Without effective medical billing, medical practices & hospitals would have no way of generating revenue from patient care. The revenue cycle of a healthcare service begins with medical billing & medical coding; poor execution of billing & coding can result in denied claims, slowing down collection & reimbursement & negatively affecting the revenue cycle. Management of denied claims, smooth medical coding, and errorless medical billing, among other things, set the foundation for the revenue cycle management of a healthcare service. 

The Components of Professional Medical Billing

Professional medical billers are usually responsible for four things:

  1. Medical Bill Creation: The medical biller creates a medical bill after a patient’s visit by adding the costs of the medical procedure or service rendered to the patient’s balance. Insurance coverage is deducted & patient copay is factored in.
  2. Medical Claim Creation & Processing: The medical biller then creates & processes a “clean” medical claim to be paid by the payer after a medical bill is created. If the claim is denied, the denial must be addressed before the claim can be paid.
  3. Third-party Communication: The medical biller is always in communication with insurance payers and other parties of the healthcare process to ensure smooth execution. The medical biller is the spearhead of the medical billing process, guiding all other parties involved with that billing until completion.
  4. Delinquent Bill Collections: The medical biller is also responsible for following up with & arranging collections on medical debt still unpaid by patients. 

The revenue cycle management of any healthcare service relies on these four components of medical billing.