Understanding Medical Billing

April 1, 2021
April 1, 2021

Healthcare providers work tirelessly to give patients the best possible care. Care and attention is paid at every step of the process, leading to successful outcomes. Then comes the HCAHPS survey, or another post-discharge data collection, and the numbers often are not as high as they could be. Why? Because the patient experience is affected by confusion and irritation connected to unexplained and often indecipherable bills and billing procedures delivered after discharge.

Medical Billing Confusion Is Common

According to a 2016 survey by Copatient, around 72 percent of American consumers reported being confused by their medical bills, and 94 percent said have received medical bills they considered to be too expensive. Hospitals and other providers can miss a huge opportunity to improve patient satisfaction scores, not to mention collections, by offering information and education on billing procedures.

The Medical Billing Cycle Explained

The medical bill can be complex. Here’s what it usually contains:

  • Statement Date: The date your healthcare provider printed the bill.
  • Account Number: Your unique account number. You must provide this number when contacting your healthcare provider’s billing office. and when paying online.
  • Service Date: A column listing the dates you received each medical service.
  • Description: A short phrase that explains the service or supplies received.
  • Charges: This is the full price of the services or supplies you received before insurance coverage was applied
  • Billed Charges: The total amount charged directly to either you or your insurance provider.
  • Adjustment: The amount the healthcare provider has agreed not to charge.
  • Insurance Payments: The amount your health insurance provider has already paid.
  • Patient Payments: The amount you are responsible to pay.
  • Balance/ Amount Due: The amount currently owed the healthcare provider.
  • Payable to: Where (or to whom) payment should be submitted.

And all that doesn’t even touch on the Explanation of Benefits, or EOB. That’s the document sent to insured individuals after a claim has been submitted by their provider. It explains what medical treatments and services the patient’s health insurance company agreed to pay for and what is left owing. This is often when patients begin to have serious questions about the whole bill, and when the dissatisfaction can really ramp up. From questions that were not asked on their part, to coding or other errors on the provider’s, confusion and miscommunication are common.

Medical Billing Solutions

Medical billing’s inscrutability isn’t going to be easily solved, because the complex system of coding, charges, payments and reimbursement is unlikely to de-complicate any time soon. Still, there are tangible and logical steps providers can take to boost patient engagement and satisfaction. Here are some medical billing tips:

  • Train frontline staff on insurance and billing. Do your schedulers, receptionists, and others understand the basic differences between copays, co-insurance, and deductibles? If not, fix it. Patients are going to ask questions of everyone they see, and it’s a safe bet they will never interact directly with coders and billing staff.
  • Verify eligibility up front. Utilize available technology to verify insurance coverage and exclusions. That way, when the patient comes in, he or she can be told exactly what’s covered (or not) for that appointment. Avoid the scenario of an expensive treatment’s being denied, and the patient being billed, when he or she thought it was covered. Nobody wins when that happens.
  • Share those results with patients. Go through the eligibility document with the patient. Print it out or have a screen or tablet available for them to review. It’s OK to say that payment is expected for a non-covered service, and ahead of time.
  • Create a sample bill. Why not generate a typical bill for an office visit with a few services, and have it available in both physical form in the waiting room, as well as a downloadable PDF from a patient portal or website? Get ahead of the questions.
  • Create a glossary of terms. Patients more often than not don’t speak medical-ese. A short list of common billing terms will be valued and position the provider as a subject matter expert and trusted authority.

Explore HealthStream Training for Revenue Cycle Staff.