Careers in medical billing and coding play a critical role in the interaction between healthcare providers and the patients or insurance companies that pay for their services. This interaction between provider and payer is known as the billing cycle. Understanding how the billing cycle works is critical to recognizing how medical billers and coders fit into the healthcare system and what their basic job duties actually entail.
Whether you work for a traditional employer or as an independent contractor, many of the responsibilities associated with a medical billing and coding career will include recording, registering, processing, transmitting and keeping track of highly personal patient account information.
How the Billing Cycle Works
Creating a Medical Claim
Each time a patient goes to a doctor’s office, hospital or clinic to receive care, the healthcare provider must make a detailed record of every aspect of the patient’s visit. This includes the patient’s personal information and relevant medical history, the extent of the medical examination, diagnoses and recommended treatments.
Following the patient’s visit, each aspect of this medical record must be translated into a standardized, numerical code before a bill can be sent to the payer, which is usually an insurance company. Today, the majority of these bills, which are also called medical claims, are sent to insurance companies electronically.
Processing Medical Claims
When an insurance company receives a bill from a healthcare provider, it must first evaluate the validity of the claim and then decide whether to approve or deny it. If a claim is approved, the healthcare provider is reimbursed for the medical services. However, if the claim is denied or rejected the insurance company must send a notice to the provider explaining the reason.
When a healthcare provider receives a notice of a declined claim, they must first figure out why the claim was rejected and then attempt to correct any mistakes before resubmitting the claim to the insurance company. This process is often repeated several times before the healthcare provider and insurance company reach a final agreement about the payment of the patient’s bill.
If you have a career in medical billing and coding, you will be involved in every step of the billing cycle. Both a medical billing career and a medical coding career will require you to play a key role in the interaction between healthcare providers and insurance companies in order to ensure that patients are billed correctly, that healthcare providers are paid for their services and that insurance companies are not overcharged.
Specific Tasks of Medical Billers and Coders
A few of the most common tasks in medical billing and coding careers include:
- Examining medical records and assigning the appropriate medical code to each service or diagnosis
- Entering medical codes into databases and patient records and creating itemized invoices for insurance companies
- Making sure that all necessary forms are included and signed before medical claims are submitted
- Analyzing denied medical claims and communicating with insurance companies about the causes of the rejection
- Explaining insurance benefits to patients
- Contacting patients and insurance companies regarding overdue payments
The best careers in medical billing or medical coding can lead you to a variety of workplaces with different focuses and fields of responsibility. In smaller doctor’s offices and clinics, for example, specialists are often expected to perform the role of both biller and coder, while larger healthcare organizations are more likely to separate these two specialties into separate jobs.
Some of the most common places of employment for medical billers and coders include:
- Private-practice physician’s offices
- Health insurance companies
- Specialized medical billing companies
- Outpatient health clinics
- Nursing care facilities
- Home health agencies
It is important to remember that even within the same type of workplace, the specific expectations and responsibilities of a medical billing and coding job in any of these settings can vary considerably depending on the employer’s needs.
Working from Home
In addition to the traditional workplaces mentioned above, another option is medical billing and coding from home jobs. Many online schools place special emphasis on the possibility of working from home, and students are often interested in the field because they assume that they will be able to make a living as a medical biller and coder while working from home.
In reality, however, government statistics show that only a relatively small percentage of specialists in medical billing careers and medical coding actually work from home. Although it is possible to begin a career from home, most experts in the field say that this is difficult. They emphasize that professionals who would like to work from home should first spend time in a traditional workplace environment in order to gain the skills and client base needed for a successful career at home.
There are two main options for working from home for people with medical billing and coding certification:
A private contractor in medical billing and coding usually has contracts of service with clients such as insurance companies or specialized medical billing companies. As a private contractor with a career in medical billing or coding, you will agree to complete a specified amount of work by a certain time, and this work can usually be performed from home.
If you are interested in becoming a private contractor, you should be aware that contractors are typically expected to supply their own equipment for the job, such as computers, coding programs and printers. Moreover, after a contract is fulfilled, either you or your client may decide not to work together again. This means that a career in medical coding or billing as a private contractor requires you to build and maintain a stable client base so that you have consistent work.
Employee from Home
Some employers in the healthcare industry find that their medical billing and coding employees can fulfill most or all of their duties from home. Although most employers do not initially hire medical billing and coding professionals to work from home, some employers may provide this option to billers and coders who can show that they are competent and efficient in their work.