What are 2 different types of billing systems in healthcare?

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What are 2 different types of billing systems in healthcare

If you are looking for a career in medical billing, it is important to understand the nature of work in a variety of facilities. Most medical billers claim that there are significant differences in the processing of medical claims in various specialties and facilities.

There is an absolute difference in billing between healthcare and other industries. There are two types of medical billing. One is professional billing. The other is institutional billing.

What is medical billing?

What is medical billingMedical billing is a very complex transaction. There is no such thing as a daily transaction where you pay the bill immediately after you receive a service or product.

In each patient’s chart, the healthcare provider provides a diagnosis by documenting what services or procedures were performed. The text is then translated into codes by a medical coder. Each code indicates what was done or why used by the physician. Next, a medical biller uses those codes, called a superbill, to include a claim sent to the patient’s insurance company. If the claim is approved by the healthcare provider will reimbursement for the services provided.

The provider’s billing department will then try to recover from the patient at out-of-pocket expenses. This is often done by sending invoices in the mail and inviting manually the patient to remind them to pay their bills.

What are the two types of medical billing?

They are responsible for properly processing the bills to ensure all parties, i.e.patients, doctors, healthcare facilities, and insurance companies has everything necessary to document the services provided and process payment for these services to the physician and/or healthcare provider.

Part of this process is knowing what kind of medical billing will come into play. Today we will look at two types of medical billing used in the healthcare industry.

Professional billing

What are the two types of medical billingProfessional billing is commonly used in the practice of individual physicians. Medicare, Medicaid, and some other companies will accept filing claims electronically. But even today billing is done through the paper. If an electronic claim is filed, it uses 837-P. This is an electronic version of the CMS 1500 form. A service or process can be described by using 2 digit modifier. CPT modifiers list helps with this.

Institutional billing

Here’s what differentiates institutional billing from professional billing:

Institutional billing typically includes billing for hospitals, clinics, rehabilitation facilities, nursing homes, etc. The UB-04 is the standard claim form is used in professional billing. The form used for electronic claims in professional billing is 837-1.

Specific job duties vary from employer to employer. Those who work in institutional billing will only focus on billing and/or collections. Those who work in institutional Medical coding are handled by designated coders. Because the coding for institutional services is more complex than professional billing. So, it requires the attention of a dedicated coder.

Medical billing software

Every office or institution uses some kind of medical billing software. This software allows accessing patient demographics, insurance information, and procedures electronically, even with the basic application.

Sophisticated forms of billing software are able to recall all available diagnostic and procedural codes. And can be combined with other independent software to meet a specific billing requirement. While medical billing software is a necessity, there is room for caution.