Electronic data interchange (EDI)
is the structured transmission of data between organizations by
electronic means. It is used to transfer electronic documents or
business data from one computer system to another computer system, i.e.
from a medical practice to an insurance payer.
A Physician billing system
should utilize the following three common EDI functions: submission of
Electronic Claims, utilization of Real Time Eligibility (RTE) and
receipt of Electronic Remittance Advices (ERA's). Lets look at each one
of these further.
- Electronic Claims replace the standard HCFA 1500 paper claim forms that are printed and mailed to the payer. The claims are batched in the medical billing software and then transmitted in an electronic format directly to the payer or to a clearinghouse. If a clearinghouse is used, they serve as the middle man for all the EDI transactions. Unlike with paper claims where you have no way to verify receipt by the payer, electronic claims can be tracked through each stage of the process, from receipt by the clearinghouse to the acknowledgement and acceptance by the payer. Additionally, electronic claims are pre-screened for certain errors with notices being sent back to the medical practice within days for quick correction and resubmittal. Due to their formatting, electronic claims are much more quickly processed by the payer, reducing the wait for reimbursement in some cases from weeks to days.
- The Real Time Eligibility function in the medical billing software allows the medical practice to verify patient insurance coverage before services are rendered. The details provided in the RTE response also confirm or provide other valuable data such as, patient address, health insurance identification number and group number, and effective dates of coverage. All of this information eliminates denials for lack of coverage and provides great assistance in submitting clean claims that will be processed quickly.
- Electronic Remittance Advices are the electronic equivalent of a paper Explanation of Benefits (EOB). The medical billing software imports the ERA from the payer or clearinghouse and often can adjudicate the payments automatically in the indicated patient's accounts. Amounts that are designated Contractual Obligations are written off, patient responsibilities such as co-pays and deductibles are allocated to the patient balance, and other open balances are applied to any appropriate additional payers. Even information regarding denials is attached to the designated services with complete details allowing medical office staff to research and choose the best action in order to resolve the denial with the payer.
If your medical system software is not utilizing all of these functions, it may be time to look for a better solution, Iridium Suite by Medical Business Systems.
Often the handling of accounts receivable
is considered distasteful, something that can be ignored or should be
handled by somebody else. Too often the calls don’t get made to
insurance companies, the appeals don’t go out, or the resolution of denials
is put off. Even though it may be difficult to find time to perform
these tasks, they are an integral part of every successful medical
practice.
Setting aside the time and assigning the accounts receivable
task to one person is the most logical option. This assures a focused
attempt to resolve problems and may reveal erroneous patterns in billing
that are missed by several people handling the receivables ‘on the fly’
or ‘when they have time’.
Most insurance companies have made information quickly available online through their secure websites. Often an EOB
or check that has been missed may be found online and entered in the
accounting software without picking up the phone. The website can also
offer more detailed information regarding claim denials. Additionally many insurance websites offer direct email to quickly access customer service with any questions.
Each insurance company has an appeal process that must be adhered to in order to get the attention directed to your claim. Keep an appeal file with details (also available on websites) so that the information is quickly available. When an appeal letter
is written, keep a copy on the computer and use it to easily change
only the patient information and date, thereby saving additional time
and keeping the format needed by the insurance company.
If
there is no other way around making the occasional phone call to an
insurance company, they often have an IVR (Instant Voice Response)
telephone number where you can retrieve all the information needed
regarding claims and eligibility. To
accomplish this task quickly, make sure all the details are at your
fingertips prior to making the call. If you must speak to a ‘live’
person, get as much information as possible at the time of the call to
avoid repeat calls. 
Finally,
if there is no time to squeeze these tasks into any staff schedules,
check into hiring outside personnel that will concentrate on this
important job. Make sure they have the communication skills and
availability to give feedback when necessary so that recurrent findings
or problems can easily transfer back to billers or medical staff. 
