An electronic medical billing clearinghouse acts as a middleman that takes electronic medical claims information and then submits it electronically to insurance companies the medical billing clearinghouse contracts with.
Why Should a Medical Billing Business Consider Using a Clearinghouse?
Look at it this way: If you don't use a medical billing clearinghouse, your client sends you a medical claim in superbill format, you input that information into your medical billing software, you print out that information on to a CMS1500 form, you mail that form out to the appropriate insurance carrier. The insurance company checks the claim for any errors, if everything is correct (called a "clean claim") the insurer submits payment to the physician for the services rendered and then you bill/invoice the physician for the services that you provided them. Now, how long do you think that process will take and what would be your expense? Well if you were to do this for each and every claim, for each and every client that you have, then I can assure you that it would only take about a month and a few weeks before you'd be out of business.
A medical billing clearinghouse cuts down on the amount of time it takes for medical claims to be accepted and processed by insurance companies. Today, the electronic medical billing clearinghouse also saves the environment because less paper is being used to complete the reimbursement process.
Why Is an Electronic Medical Billing Clearinghouse a Must?
There are several reasons but these impact both your business and your profits:
- Medical billing clearinghouse software catches errors that you may have made during the data entry process.
- Once a clearinghouse catches those errors they let you know in real time where the mistakes were made for each and every medical claim so you can correct them, thus reducing the chances of receiving rejected claims.
- You submit your claims to a clearinghouse electronically so the clearinghouse that you pick should also transmit your claims to the insurance carriers electronically, which will dramatically reduce your reimbursement time to less than ten days. I guarantee you that your clients will love you to death and pay on time each and every month.
- Using an electronic medical billing clearinghouse eliminates the need for you to re-key data over and over for each payer, which saves you hundreds of hours in data entry. Plus, because they already have the insurance carriers’ information in their system, you can worry less about human errors being made when transmitting claim information.
- A medical billing clearinghouse allows you to submit all your claims at the same time, rather than submitting them separately for each individual insurer. Again, the faster and more cleanly your claims are submitted to the carriers, the faster payments are received by your medical billing client.
- A medical billing clearinghouse gives you a secondary location from which to manage all your electronic claims—in addition to the backups that you create of your work on a daily basis, such as those on your computer, on CD/DVD, tape drives, etc.
- A medical billing clearinghouse saves you from spending valuable hours of your time waiting on hold following up on claim errors or rejections with several different insurance carriers.
- Electronic medical billing clearinghouses drastically reduce or eliminate the need for you to print paper forms, envelopes and spend money on postage.
Simply put, when you use a good medical billing clearinghouse, your clients get paid faster so you can continue to service your clients' needs, which, in turn, will make your clients refer more business to you without your having to ask. As a result, your ROI (return on investment) and profits will skyrocket. In short, a medical billing clearinghouse, especially today's electronic medical billing clearinghouse, can give your medical billing business a competitive advantage over your competitors who do not use them.
The Medical Billing Clearinghouse You Choose Should:
- Provide you with a huge payer list from which you can choose.
- Be nationwide, NOT regional.
- Provide sync support for the type of medical billing software you are using to create, batch and submit claims.
- Have an easy-to-get-out-of contract.
- Provide excellent customer service and support.
- Give you online access to update, track and manage the claims you have submitted.
- Not charge excessive monthly fees that are beyond the industry norm.
The medical billing clearinghouse you select should also provide you with the ability to process the following (Note: Some of these services can be offered to your clients at an additional charge thus increasing your profits per client):
- Eligibility verification
- Sent file status
- Claim status reports
- Rejection analysis Drop and mail paper claims if needed Secondary claims processing
- Electronic Remittance Advice (ERA)
- Patient statement services
- Payment processing reporting
- Transaction summaries and reports of all your clearinghouse activity
A home-based medical billing and coding business is one that provides physicians with several levels of services and a medical billing clearinghouse does the same for the medical billing business owner. Be absolutely certain that you shop around for medical billing clearinghouses that best fit your needs and budget - but DO NOT choose one strictly based on cost.
Electronic medical billing clearinghouses must provide at least the services I’ve mentioned earlier. If you have to wait due to customer service issues at your clearinghouse you will lose money, your personal and business credibility, and finally your valuable clients.
Last, pay special attention to the medical billing clearinghouse’s startup and enrollment fees that you may have to pay for each practitioner or practice you will be submitting claims for. Those charges can eat into your profits. There are medical billing clearinghouses in the marketplace that charge flat fees regardless of how many physicians you bill for now or in the future, so proper research is the best way to keep your clearinghouse expenses to a bare minimum.
This article is part of the Medical Billing Guide