Healthcare is one of the largest and fastest-growing industries in the United States. Americans spend over $8,000 per person on healthcare each year, with health insurance accounting for a sizable chunk of that total.
WHAT EXACTLY IS HEALTH INSURANCE?
Essentially, health insurance subscribers sign into an agreement with a health insurance provider to decrease the impact of medical expenses. There are numerous types of insurance policies available, as well as numerous ways to pay for them.
Most plans have a few fundamental similarities. Most insurance plans necessitate the payment of premiums, which are basically subscription fees. These might be assigned on a monthly or annual basis.
Many plans also include deductibles, which are monetary limits that must be met before the health insurance company assumes the cost of the medical operation or service.
Subscribers and their insurance companies may also have a copay or coinsurance arrangement. A copay is a small, fixed payment that must be paid before any medical services are rendered.
How to claim insurance?
Let’s briefly talk about the electronic and manual application forms. HIPAA regulations require that most required transfers be electronic. This does not mean that all applications are filed electronically, although that would probably be ideal.
HIPAA regulations require standard transactions such as applications to be submitted electronically. However, there are some exceptions to this rule. First, a company with fewer than 10 employees can use manual complaints. Additionally, a practice experiencing a power outage can manually file complaints if those complaints are urgent.
The two most common application forms are CMS-1500 and UB-04. The two forms look and function the same, but are not interchangeable. UB-04 is based on CMS-1500 but is actually a variant of it – it is also known as CMS-1450.CMS-1500 forms are used in non-institutional health care settings (e.g. private practice), while UB-04 (CMS-1450) forms are commonly used in institutional health care settings such as hospitals.
The billing process of an insurance company or other third party payer is difficult to summarize as it all depends on the variables. These variables include things like the patient’s insurance plan, payer eligibility policies, and the provider-payer agreement. Our goal in these courses is to prepare you for formal training in medical billing, not to go into detail about the various technicalities involved in the claims process. However, in future videos we will cover a number of practical examples and in future courses we will explore two of the most important aspects of the medical billing profession and its relationship with third-party payers: Medicare and Medicaid. and HIPAA.