What is Medical Billing?

'What is medical billing?' you may have asked. This article about medical billing explains this important field...

Medical billing is a professional career designed to help health care professionals and insurers communicate and manage the costs of patient treatments. Basically billers ensure that doctors get reimbursed for their care, and that all medical procedures are reported correctly.


Medical Billing Basics

Medical Billing Basics
Want to quickly get to grips with the fundamentals of medical billing? We recommend the ebook The Basics of Medical Billing, a guide to the industry written by a mother/daughter team of billers. Learn more about it here.


It's hard to imagine how physicians and hospitals get paid. With all the types of doctors, important forms and different insurance plans, even thinking about it is overwhelming.

As individuals in the US we rarely pay for our healthcare services directly.

Instead, we make co-payments and pay insurance premiums so that an insurance company can pay for our healthcare.

Learn how insurance companies calculate premium prices.

Once you go into your doctor's office and receive treatment as a patient, you set in motion a complex billing process designed to ensure that everyone involved in your health care is billed and credited appropriately.

Typically, your doctor's office or hospital starts this process by submitting an insurance claim to your insurer.

If the procedures outlined in your claim are covered by your insurance policy, your insurer will pay your doctor directly. If the services aren't covered, your doctor bills you directly.


On the surface, this looks like smoothly run, well-established process...

However, the billing process suffers from high volume, staffing shortages and a complex array of practices and procedures.

Insurances plan their coverage and payments according to a standard called "necessary procedures". These are treatments deemed to be medically necessary to maintain the well-being of the patient.

Apart from treating you, your doctor also has a responsibility to the insurance company by providing appropriate documentation.

Seems simple enough, right?

Not really - each insurer often requires different levels of documentation before they will make a payment. If your provider does not complete their documentation correctly, they may not get paid for any of their services.

If your doctor's office can't manage this effectively, payments get delayed or denied.

Take this process and multiply it against the hundreds of patients that come through a doctor's office each day...

...the medical billing process can rapidly become a nightmare!

In order to handle this, healthcare providers depend on medical billers and coders to prepare bills and provide supporting documents to get paid. In essence, billers and coders make sure doctors are properly paid and procedures are properly reported.

Hopefully this has answered the question 'What is medical billing?'. For more information on medical billing, have a look at the medical billing process.


Ready to continue?

Start learning the various parts of medical billing and coding, or read our guides to different types of medical billing and coding courses.

If you want to brush up on the terminology, see the medical billing glossary.

To learn about what you need to do to start working in billing or coding, have a look at our section on medical billing and coding jobs.


We also recommend the ebook The Basics of Medical Billing for getting a good grasp of the industry.




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