Clearinghouses are used by several million licensed healthcare providers for sending medical claims to over 4,000 different insurance carriers daily across 50 states. This is complicated by the fact that each insurance carrier has its own internal software and each state has its own insurance regulations. Electronic claims clearinghouses were created by Medicare and large insurance payers to pre-screen for claim errors and facilitate claim submissions.
Using sophisticated software, clearinghouses send and receive massive electronic claim information. Healthcare practices transmit electronic claims through clearinghouses to insurance carriers while adhering to HIPAA regulations. Clearinghouses also allow medical billing companies to consolidate their electronic claims with management from a central online control panel.
Here’s how the clearinghouse processes medical claims:
Medical billing software within a medical practice creates electronic files or claims. These are uploaded to the clearinghouse account where the claim is scrubbed to check for errors. Claims passing inspection are securely transmitted to the specific payer. The claim is either accepted or rejected by the payer who transmits a status message back to the clearinghouse. Rejected claims may be corrected and resubmitted. Provided the insurance was verified and the claim approved, the payer issues a reimbursement check or Electronic Funds Transfer (EFT) along with an explanation of benefits (EOB).
The best clearinghouses reduce the average error rate from 28% to 2-3%. They offer valuable features that offer a revenue cycle management intelligence through inclusion of these features:
- Eligibility Verification that determines the patient’s payment responsibility.
- Electronic Remittance Advice (ERA) that automatically updates payments and adjustments.
- Claim Status Reports that update in real time to provide the current status.\
- Rejection Analysis that explain error codes in simple terms.
- Online Access that allow for editing and correcting claims online.
- Printed Claims that when needed, provide claim information on a paper document.
- Real Time Support that includes 1-on-1 personal support and training by experienced billers.
- Affordability that is afforded by the savings in costs associated with purchasing forms, printing, postage and time.
Why use a healthcare clearinghouse?
Plain and simple, using a healthcare clearinghouse greatly simplifies and accelerates your claims processing. The need to manually re-key transaction data over and over at the payer’s website is eliminated. Besides vastly reducing the chances for claim errors, clearinghouses remove the extra, unnecessary burden on billing staff who are forced to remember multiple transmission methods, multiple logins and passwords, multiple file names and file types, and to memorize each carrier’s often cryptic error codes, and then interpret each carrier’s often confusing claim status reports.
Main benefits of using a healthcare clearinghouse include:
- Errors can be caught and fixed in minutes rather than days or weeks.
- There are fewer denied claims and significantly higher claim success.
- Rapid claims processing can reduce reimbursement time.
- All claims can be submitted in a single batch instead of submitting them one at a time.
- Reduces human error and time needed to manually re-key transaction data over and over at each payer’s website.
- Provides a single location to manage all your electronic claims.
- Vastly improves provider relationships with insurance carriers.
- Eliminates prolonged wait-times for inquiries about claim errors with Medicare and Blue Cross.
- Access to a knowledgeable support person almost immediately.
- Shorter payment cycles lead to more accurate revenue forecasts.
- Eliminates the need and cost for paper forms, envelopes and postage.
Answer these questions to determine if you will benefit from using a healthcare clearinghouse:
- Does your practice bill (or plan to soon bill) electronically?
- Does your practice bill a number of insurances, or just one?
- Is your staff experienced at billing electronically? (The less experience, the greater the need, and greater the benefit).
- What is your claim volume? The cost of a clearinghouse is often offset by no longer having to send in paper claims.
- Would it help to quickly and greatly reduce medical claim errors?
- Would it help to drastically shorten reimbursement times?
- Do you have better things to do than be on hold with carriers trying to figure out claim errors?
How to Select a Good Claims Healthcare Clearinghouse
When choosing a clearinghouse, here are some important things to look for:
- Payer List should include the insurances you bill on a regular basis.
- Should be nationwide rather than regional.
- Compatible with claims billing software you are using.
- Easy-out contract in the event that the clearinghouse does not meet your needs.
- Support is available and easily obtained.
- Error Reports & Control Panel online where you manage your medical claims should be easy to navigate. Claim errors and rejections should be reported in clear, concise language.
- Advanced Revenue Cycle Management Features are extremely important. These include Eligibility Verification, Sent File Status, Claim Status Reports, Rejection Analysis, Paper Claims (created for you and mailed when necessary), Secondary Claims Processing, Electronic Remittance Advice (ERA), Payment Processing, and finally, Transaction Summaries of all your clearinghouse activity.
When you are choosing a specialty medical billing company, discover the 360 Medical Billing Solutions difference when it comes to claims processing, medical billing software and clearinghouse solutions. 360 Medical Billing Solutions automation integrations streamlines practice management, reduces stress, and takes your practice to a whole new level of profitability.