The medical billing process is how healthcare providers get paid for the services they provide. It’s really important for keeping your practice running smoothly. This guide will show you all the steps involved in medical billing and give you a helpful infographic to look at. If you’re a healthcare provider like a doctor or therapist, it’s important to understand medical billing to make sure you’re getting paid correctly for your work!
Understanding Medical Billing Process
The medical billing process involves different stages, starting with registering a patient and recording any care given, and ending with getting paid for your services. The key players are the patient, the provider, and the insurance company, and they all communicate with each other.
This process is also called the billing cycle. How long it takes for your office to finish this cycle is an important measure of how well your office works. Usually, the industry takes about 40 to 50 days to finish a billing cycle. But some offices do it faster, in 30 days or less. How does your office compare?
There are things you can do to make your medical billing process faster. You can work on improving your first-pass claims acceptance rate and use medical billing software and partner with medical billing companies in the USA to make your billing process smoother. Doing this is important because the faster you get paid, the more steady your cash flow becomes.
But before we talk about making your billing cycle shorter, it’s good to understand each step. Let’s look at them more closely.
Medical Billing Process Steps
Step 1: Registering the Patient
The billing starts when a patient asks for your help. You need to register new patients, get their health history, insurance details, and other important info. For returning patients, you update their files with their latest reason for visiting and any changes since their last visit.
Step 2: Determining Financial Responsibility
Once a patient is registered, you figure out what treatments their insurance covers. Insurance companies have specific rules about coverage, which can change each year. It’s crucial to keep your practice updated on the latest requirements.
Step 3: Getting Codes
In medical billing, there are two types of codes used to keep track of patient/provider visits. The first set of codes is from the World Health Organization. They’re called International Classification of Diseases (ICD) codes, and they match up with the health issues being looked at or treated. ICD codes get updates often. Right now, we’re using ICD-10, but in 2025, ICD-11 will take over.
The other codes in medical billing are called Current Procedural Terminology (CPT) codes. These codes are made by the American Medical Association (AMA). CPT codes point to the treatments given by the doctor or nurse. They’re really important for making sure you get paid correctly for the services you provide.
Every time you see a patient, you need to write down both ICD codes for the symptoms you’re checking and CPT codes for the treatments you’re giving. Since there are a lot of CPT codes (over 10,000!) and even more ICD codes (around 70,000!), we suggest using smart software to keep your medical coding always up to date.
Step 4: Making the Superbill
After a patient leaves, you put together your codes and details into a document called the Superbill. This Superbill is important for getting paid. It has info about the provider, patient, and what happened during the visit. Here’s what the Superbill needs:
- Provider’s details: Name, NPI number, location, and contact info.
- Referring Provider’s Name and NPI.
- Signature.
- Patient’s details: Name, date of birth, and contact info.
- Insurance details.
- Visit details: Date, codes for what was done, any fees, and how long it took.
Step 5: Sending Claims
Your medical biller uses the Superbill to make a claim and send it to the insurance company to get paid. If the info is complete and correct, it’s more likely to get accepted the first time. This is called a “clean claim.” Having a high rate of clean claims means your billing process is efficient. Some offices achieve a 99% clean claims rate, which boosts revenue. If you want to see how much a 99% clean claims rate could help your office, check out our Revenue Calculator!
Step 6: Keep an Eye on Payer Decisions
After sending the claim, the payer will check if it’s okay or not. They can say yes, no, or maybe. Here’s what each one means:
- Yes: This is good. It means they’ll pay, but not always everything.
- No: This happens when the service isn’t covered. That’s why knowing what’s covered is important.
- If they say no, find out why. This helps to avoid problems next time.
- Maybe: This is different from a no. Maybe they couldn’t even look at it because there were mistakes.
Step 7: Let Patients Know What’s Left
Once the payer pays part, the rest goes to the patient. If everything goes well, they’ll pay you. But sometimes they don’t. It’s important to know about this and ask for payment if needed.
Step 8: Keep Checking
Checking on claims is important. It helps to get money you might lose otherwise. Once patients get their bill, make it easy for them to pay. Having an online system can help. The easier it is to pay, the less likely it is to go to collections.
