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Hospital Medical Billing Explained

April 7, 2023

With the challenges of hospital medical billing and coding, hospitals face the daily balancing act of serving their community and making ends meet.

By understanding the fundamentals and intricacies of the hospital medical billing process, your organization ensures a smoother revenue cycle that allows you to focus on what you do best: providing quality patient care. 

What is Hospital Medical Billing?

Hospital medical billing involves creating and submitting healthcare claims to insurance companies to receive payment for services rendered by providers. It also includes billing payers for the medical facilities, special medical equipment and supplies, and laboratory services provided.

A medical biller translates a healthcare service into a claim using the appropriate codes and follows the claim to ensure the hospital receives timely reimbursement.

coronis health hospital medical biller talking with patient

Common Hospital Medical Billing Pitfalls and How to Avoid Them

Common mistakes in the hospital medical billing process that leave you vulnerable to claim denials include: 

  • Incorrect billing – occurs when a hospital bills a patient for incorrect services or services they never received.
  • Duplicate medical billing – occurs when a hospital bills a patient at least twice for the same procedure, exam, or test.
  • Unbundling – occurs when groups of procedures frequently grouped together are billed under separate codes.
  • Upcoding – occurs when a diagnosis is inflated from a moderate to a more serious condition or when a patient is billed for a service covered by insurance rather than the one administered, which is not covered.
  • Undercoding – occurs when a provider fails to capture all services performed or bills for less expensive procedures.

Your steady revenue flow relies heavily on ensuring there aren’t any billing errors that cause damage to your bottom line. Below are two essential steps that save your staff time and increase your profitability:

Ensuring Accurate and Timely Claim Submissions

coronis health hospital worker talking with patient in hospital bed

Accurate billing and coding are only possible with complete medical records, patient charts, and insurance identification, verification, and authorization. Coders only assign the appropriate CPT codes if they can access complete and accurate records.

Electronic Health Records (EHRs) help hospitals organize paperwork, streamline processes, and reduce errors by standardizing data and automating tasks such as claim processing. Medical billers and coders quickly access information from EHRs to justify financial reimbursement while maintaining an accurate record of medical events.

Claims scrubbing technology is another valuable tool for hospitals. Claims scrubbing reviews a claim’s accuracy and completeness before submitting them to insurers. 

Hospital Medical Billing and Coding Compliance

A hospital compliance program is vital to avoid delayed payments and costly investigations while improving cash flow and patient satisfaction.

Part of your compliance strategy should be performing internal audits. Conduct a compliance audit to identify inefficiencies in your system. Then, third-party auditors can analyze your billing and coding process and identify workflow inefficiencies and areas of opportunity. These audits ensure corrective actions that help your hospital remain compliant.

A robust training and education program is crucial to comply with hospital medical billing and coding regulations consistently. Educate your providers and staff members about billing and coding compliance, including common mistakes that lead to fraudulent claims. Ensure your billers and coders are appropriately trained and know the current hospital medical billing codes and federal policies. They must also be aware of changes to billing and coding standards set forth by the Centers for Medicare & Medicaid Services (CMS) and private payers.

coronis health hospital staff having a meeting

Develop thorough documentation strategies, including the use of technology tools that help automate tasks, ensure the privacy of patient information, and enable users to code data appropriately to allow the accurate transfer and documentation of information. 

The Benefits of Outsourcing Your Organization’s Hospital Medical Billing

Hospital medical billing can be challenging and time-consuming for most providers who need access to the skilled staffing required to perform these tasks efficiently. Outsourcing your organization’s medical billing may be the best solution.

Here is a list of the benefits of outsourcing hospital medical billing services.

  • Access to a team of experts – outsourcing to certified billers who have the skill and experience in working with healthcare facilities and insurance payers have a deeper understanding of the nuances of the billing process. They efficiently perform their tasks without confusion about medical terminologies, disease conditions, and codes. Their knowledge and experience ensure you capture every last dollar.
  • Reduced errors – professional medical billers specialize in billing and focus exclusively on filing claims. Since they give claims due attention, they reduce errors and inconsistencies, leading to fewer denied or rejected claims. 
  • Saves money – outsourcing your billing means you don’t have to spend on training, salaries, and benefit costs. Medical billing companies also offer various pricing models, allowing you to select the best option that suits your needs.
  • Better turnaround time and increased cash flow – expert billers are proficient in systematically dealing with large volumes of data. With a skilled workforce and advanced technology tools, they file accurate claims and ensure shorter revenue cycles.
  • Enhanced billing compliance – medical billing companies ensure regular staff training so their coding process is up-to-date and meets industry standards. They ensure compliance is integrated into all operations, including internal and external audits.
  • Improves patient satisfaction – relieving your staff from the burdensome paperwork associated with billing enables them to create a more patient-friendly environment in your organization. When healthcare providers devote their time to providing quality care, patients remain happy throughout their stay.

With billing expertise, robust business intelligence, and advanced hospital medical billing software, medical billing companies are well equipped to help organizations of all sizes and types, including rural hospitals, get timely reimbursements for their services provided.

To learn more about how you can benefit from outsourcing medical billing, contact Coronis Health to request your free financial checkup.

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