Biggest Medical Billing Challenges and How To Overcome Them

Healthcare service providers worldwide face a serious common challenge: medical billing errors. According to a 2016 research by Becker’s Hospital Review, as many as eight in ten medical bills had some errors. This is estimated to cost an equivalent of seven percent of the global health expenditure and has been dubbed one of the “last great unreduced healthcare costs”.

The causes of billing errors are plenty. Some lie with the patients, but most involve the medical institutions. Identifying and addressing these is imperative. It will not only help stop revenue leakage but also improve operational efficiency and improve medical services. So, let’s diagnose the common medical billing challenges and find their cure.

Common Challenges in Medical Billing With Solutions

1. Incorrect or inconsistent coding

The ICD and the CPT are the two main medical coding systems, and there are other standards besides. The code sets of different coding systems may remain incompatible, which may lead to coding inconsistency. Coding errors can also result from using outdated code sets, incorrect modifiers—a two-character code appended to the main code to furnish additional information about the service or procedure—or incomplete documentation. Coding errors translate to inaccurate medical billing and have a direct impact on the financial condition of healthcare providers. And as coding converts services provided into billable revenue, errors in coding result in delayed reimbursements or even denial of claims.

To ensure accurate coding, conduct regular internal audits to identify coding errors. Develop coding guidelines and be familiar with the services provided and procedures involved. Establishing a good communication channel between the service providers and coders is also essential, as in many instances coding errors occur due to unclear or illegible medical documentation.

2. Incorrect or insufficient patient information

Miscommunication, typos, or outdated information can result in inaccuracies in patient demographics, insurance details, or medical history. Even a minor error about the patient, such as a misspelled name, can lead to a claim rejection. It is thus crucial to ensure that no information is left out and that no discrepancy is included in the insurance claim.

To ensure the accuracy and completeness of patient information, implement a thorough verification process at the point of registration. Double-check the patient details and the insurance information.

3. Inadequate documentation

Specific documentation details required for processing claims are sometimes missing. This can include incomplete progress notes and unauthenticated medical records. Issues typically arise due to time constraints, lack of proper awareness of billing requirements, or unclear documentation.

The best antidote is to train and educate staff on the importance of thorough documentation. Over and above, develop clear documentation standards for all types of medical services.

4. Inaccurate charge entry

Medical billing charge entry errors have implications for all the stakeholders—providers, patients, and payors. The error can be due to data entry slip-up, omission of specific patient or billing reference data, or incorrect mapping of services to their charges.

Implement a charge capture system and a protocol for double-checking charge entries before finalizing the bill. Working with professional providers of charge entry services can also significantly improve the process.

5. Duplicate billing

Any claim is deemed a duplicate if the same service provided to a particular individual on a specific date is included in a previous claim. Duplicate billing leads to delays or loss of payment, or worse, loss of reputation.

To avoid double billing, make use of claim scrubbing software systems. These can help identify and prevent duplicate entries before they are submitted. Periodically review claims and rectify any instances of duplicate billings.

6. Tracking denied claims

According to an American Medical Association report, five percent of claims are denied, and an MGMA study found that more than half of the denied claims are never resubmitted. This results in a significant revenue loss.

Addressing denials starts with tracking them and identifying the causes. Run a report of denials over a period of time and sort the report by reasons for denials to determine how you can best improve. Use standardized claim correction forms to make the process of re-filing claims more efficient.

7. Verifying insurance coverage

Insurance verification is an important aspect of revenue cycle management. Failure to verify insurance coverage can lead to inadequate compensation for services provided and increase administrative hassle.

The simple and best way to verify insurance coverage is to collect all necessary information from the patient including their social security number and insurance details. Then verify these through EHR systems or by directly contacting the insurance company.

8. Keeping up with regulations

Healthcare laws, insurance policies, and billing guidelines differ from region to region and often change, making it difficult to keep up with them.

But one has to keep up with them or face costly consequences. You may also consult legal advisors and compliance experts to guide you on the changes and the implications. Having an internal compliance team dedicated to monitoring, interpreting, and implementing the regulatory changes also helps.

9. Reconciling billing data and EHR

Keeping the payment and the patient EHR separated can make the billing process clunky and error-prone. Reconciling billing data and EHR makes it convenient for patients to remit payments and for healthcare providers to efficiently manage billings.

Ensure that the EHR system and the billing software are fully integrated and compatible. Then regularly conduct audits to compare the EHR and billing data for discrepancies. And establish a feedback loop between the clinical and billing departments to promptly identify and address any inconsistencies.

10. Staying up to date with patient information

A person’s medical conditions, insurance coverage, and other personal information often change, making it necessary to regularly verify and update the details. Failure to do so can lead to increased denial of claims.

You should have protocols in place to verify personal details, insurance coverage, and eligibility before or during check-in. Then regularly verify and update patient information at each visit. And regularly remind patients to update their information. Also, ensure that the patient information update system is well integrated with the EHR system.

Outsourcing: An Effective Way To Overcome the Challenges

An efficient medical billing process is important not only for improving your financial health but improving customer service. By deftly tackling the common challenges mentioned here, you can significantly improve your medical billing process, as it is often a few hurdles that cause a majority of the billing issues.

But overcoming these challenges requires expertise, money, and time—bigger impediments perhaps than the challenges themselves for many small providers. A viable option is to outsource medical billing services to a professional company. This can help save costs as well as improve efficiency.

They have the necessary tools and expertise in billing and coding. And they charge for specific services rendered. Certified billing companies are also compliant with regulations like HIPAA and are well-informed about the changes in the industry. Your data are secured, your billing services compliant, and your revenue cycle healthy.

Final Note

To wrap things up, medical billing is fraught with plenty of challenges and issues, some bigger than others and some more recurrent. But issues, big or small, affect the revenue cycle negatively. Tackling and fixing them is imperative for a healthcare provider to remain functional and healthy. If they aren’t addressed quickly, the revenue bleeds and the medical service offerings suffer.

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