Empower Your Practice

Journal for Practice Managers

Medical Billing: What You Need to Know

Medical Billing

Medical billing is one of those tasks that you, like most practitioners, probably do not look forward to even though it is essential that you receive adequate compensation for your services. Let's take a look at the principles of medical billing for insurance claims and self-pay patients.

What Is Medical Billing and How Does It Affect the Doctor-Patient Relationship?

Medical billing refers to the transactional aspect of healthcare provision and can be best summarised as the relationship between 3 different groups of people: healthcare providers like doctors and clinics, healthcare recipients (patients), and payers. This three-way relationship is pretty clear-cut when the payer is an insurance company, but not so straightforward in the self-pay market where you as the practitioner don't want to reduce the doctor-patient relationship to a transaction.

From an ethical standpoint, it makes total sense that you don't perceive your patients purely as a means to a selfish end. Nevertheless, you do deserve to be compensated well for your services and to make a good living from your expertise. There is an easy way to ensure that you collect payments efficiently without intruding on the doctor-patient relationship and damaging your rapport with patients. You should make use of a practice management system that can handle automated invoice generation.

Medesk is an assistant for clinic managers, collects and presents complex statistics about the work of the clinic in a simple and understandable way, that makes it easier for the manager to make both operational and strategic decisions.

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Read: The Role of Practice Management Software in Patient Retention

What Should a Medical Bill Contain?

There are certain kinds of information that must be present on any invoice or insurance claim made as a result of medical services rendered. In the case of claiming payment from insurers, you can actually end up losing out if your document is not in line with what is expected of it. Even in the case of self-paying patients, your documents should contain enough information to make it clear as to why the charges listed were levied, including any necessary modifiers like 'modifier 59' for distinct procedural services. Understanding and correctly applying such modifiers ensures accurate billing and prevents claim denials.

To facilitate the payment process and give the best possible impression to the payer, you should:

  • Add a high-resolution colour logo to your letterhead
  • Provide your contact details, including address, phone number and email
  • List each invoiceable item one by one
  • Use a table to clearly display each aspect of every service rendered, which may include:
    • Item codes that insurers can use, e.g. CPT codes in the US
    • Situational coding such as SNOMED
    • Diagnosis to justify services, e.g. using the ICD-10 database in Medesk
    • Drugs prescribed based on the diagnosis, e.g. using a searchable BNF database
    • Medical history for the rationale for services rendered
    • Cost, including discounts or taxes as appropriate
    • Information on how and when payment is to be made, e.g. by bank transfer within 14 calendar days of the appointment

Medesk can automatically generate medical collection and billing documents based on all of the above information and more. We can customise your approach to billing depending on your exact requirements. The next section looks at how we automate invoice generation and keep your practice going as a business.

How to Automatically Generate Medical Bills and Invoices

One of the best ways to both ensure that you get paid appropriately for your work and to remove yourself from any financial transaction is to use practice management software that automatically generates your billing and invoice documents as you record your activity with each patient.

Using Medesk, you can set up invoices as you go along. Once you have pre-defined precisely what information needs to go into your financial documents, their actual production is incredibly straightforward. It involves just a couple of clicks and you can easily delegate the task to your reception team or personal assistant.

If you are making a booking while talking to a patient on the phone, you can start the production of a pro forma invoice as a matter of course. You just search for and add the services in the appointment booking window on your schedule.

When it comes to patients using online booking, once they choose a service and book their preferred time slot, an invoice will automatically be generated in Medesk. You can access it and make changes at any time, including during the consultation itself.

Read next: How to Produce Perfect Documents

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