Medical Billing and Medical Coding are two parts that make up the process by which healthcare organizations get paid. Within the revenue cycle, the processes of medical billing and medical coding work together to create a claim and submit it for reimbursement.
A complete understanding of the basics of medical billing & coding is important to create a seamless revenue cycle.
Medical coding is a process of translation. It is taking the procedures and diagnoses and translating them into numerical or alphanumerical codes.
Medical coding begins in the patient encounter. A physician is responsible for complete and accurate documentation of everything that occurs in the encounter. The coder then takes that information and translates it into codes that represent both the diagnoses and procedures that occurred.
Coders have two types of code sets that they pull from to include on the claim. The first is International Classification of Diseases, or ICD codes, and the second is Current Procedural Terminology, or CPT codes, and Healthcare Common Procedure Coding System (HCPCS codes).
Many practices today have found that the best method for collecting this data is using an automated charge capture software. Automating charge capture allows physicians to easily document the charges in the same way that they used to do on paper charts. The easy-to-use form of AccelaCAPTURE helps doctors capture the right codes without forcing doctors to be coders themselves.
International Classification of Diseases, or ICD codes, are the codes that are used to identify different diagnoses or injuries. The current list of ICD-10 codes contains 87,000 different codes. You can download our free ICD-10 guide here.
Current Procedure Terminology, or CTP codes, are the codes that correspond to the billable procedures that are performed in an encounter. This can be any service or procedure performed for the patient.
Medical coders need to take note that CPT codes include modifiers that help to further specify the procedure performed. These modifiers can describe whether multiple procedures were performed, why they were medically necessary, and where on the patient the procedure was performed.
Another procedure code set that is often used is the Healthcare Common Procedure Coding System, or HCPCS. CMS and some other payers require the use of HCPCS codes. Often these codes will overlap with CPT codes. The difference is that HCPCS codes include non-physician services. This includes ambulance rides, DMEs, and prescription drug use. Another thing to note is that HCPCS codes have their own set modifiers (many of these are the same as the modifiers used for CPT codes).
Unlike medical coding, medical billing begins at the very front-end of the revenue cycle. As soon as a patient calls to schedule an appointment, information is collected that pertains to the billing process.
Patients are asked to complete any necessary paperwork, and they confirm patient information. If applicable, copayments are collected at check-in. This is also the time for the level of patient financial responsibility to be confirmed. It is important to know before the patient goes into their appointment so that surprise medical bills can be avoided.
After the medical coding occurs and a claim is generated, billers submit claims to the correct insurance payer. Billers are responsible for making sure claims are submitted in a timely fashion, and that all denied claims are followed up on.
Reducing Denied Claims
Even with a seamless medical billing and medical coding process in place, denied claims can occur. When they do, it is important to follow up as quickly as possible. Over half of all denied claims are never resubmitted – that is wasted revenue.
Download our free denial management guide to protect your practice from denied claims. We also created a denial reason code lookup tool, so you can easily follow up on any denied claims you face.