What Does a Clearinghouse Do During Claims Submission?
Short Answer: A clearinghouse is an intermediary between healthcare providers and insurance payers. It ensures that claims are accurately formatted, error-free, and compliant with payer requirements before submission. This process helps streamline claims processing, reduce denials, and expedite reimbursements.
What is a Clearinghouse?
A clearinghouse plays a key role if you’ve ever wondered how medical bills are processed and paid.
Think of a clearinghouse as a middleman between healthcare providers (like mental health providers or hospitals) and insurance companies. Its main job is to ensure that the claims (bills) sent by healthcare providers are accurate and formatted correctly before they reach the insurance companies. This helps to speed up the payment process and reduce errors.
The clearinghouse is a central hub where claims are received, checked for errors, and forwarded to the appropriate insurance companies.
The Role of a Medical Billing Clearinghouse in Claim Submission
1. Claim Submission
When a healthcare provider submits a claim, it first goes to the clearinghouse. This can be done through electronic file submission, which is much faster and more efficient than paper claims. The clearinghouse checks the claim for any errors, such as invalid diagnosis codes or missing or invalid information, and ensures it meets the standard format required by the insurance payer.
2. Eligibility Verification
Before a claim is submitted, the clearinghouse can verify the patient’s eligibility for services. This step is crucial as it helps avoid claim denials due to inaccuracy, saves time, and improves the provider’s cash flow.
3. Claim Scrubbing
The clearinghouse uses advanced tools, sometimes powered by artificial intelligence, to “scrub” the claim. This means it checks for errors or inconsistencies that could lead to a denial. If any issues are found, the claim is noted for the provider to make any necessary adjustments
4. Claim Submission to Payers
If the claim is accepted, it is then forwarded to the appropriate insurance payer. This could be a primary claim to the main insurance company or a secondary claim if multiple payers are involved.
5. Claim Status Inquiry
Providers can use the clearinghouse to check the status of their claims. This is often done through a provider portal where they can get real-time updates on their claims.
6. Remittance Advice and Payment
After the insurance payer processes the claim, they send back remittance advice, which details what has been paid and any adjustments made. The clearinghouse forwards this information to the provider. In most cases, electronic remittance advice (ERA) is used, which speeds up the process. Providers can also receive payments through electronic funds transfer (EFT), posting it electronically into the EHR software, ensuring quicker reconciliation
7. Additional Services
Clearinghouses often provide additional services such as eligibility information, comprehensive claims recovery reports, and support for timely filing deadlines and denials. They also help with payment recovery details and provide detailed information on the claims process.
The Claims Submission Journey Simplified
Let’s simplify the journey of a medical claim from the doctor’s office to the insurance company and see where the clearinghouse fits in.
- Claim Creation: After you visit your doctor, the healthcare provider creates a claim.
- Sending to the Clearinghouse: Instead of sending this claim directly to the insurance company, the healthcare provider sends it to a clearinghouse.
- Claim Scrubbing: The clearinghouse reviews the claim for errors or missing information. It checks for invalid codes, missing patient information, or formatting issues.
- Error Correction: If the clearinghouse finds any errors, it notifies the healthcare provider to fix them.
- Claim Submission: If there are no errors, the clearinghouse forwards it to the appropriate insurance company.
- Acknowledgment and Tracking: The clearinghouse also tracks the claim and provides acknowledgments. This means they monitor the claim’s status and inform the healthcare provider if the insurance company has received, accepted, or rejected it.
Why Use a Clearinghouse?
You might wonder, “Why not just send the claim directly to the insurance company?” Here are a few reasons why using a clearinghouse is beneficial:
- Error Reduction: Clearinghouses help reduce the number of rejected claims by catching errors early. This means faster payments and less hassle for healthcare providers.
- Efficiency: Clearinghouses streamline the claims submission process, making it quicker and more efficient. This is especially important for busy healthcare practices.
- Compliance: They ensure that claims meet the specific requirements of different insurance companies, which can vary widely. This helps maintain compliance with industry standards.
Special Considerations for Mental Health Providers
Mental health billing can be particularly complex due to the various services and treatments. Here are some specific benefits of using a clearinghouse for mental health claims:
- Specialized Knowledge: Clearinghouses specializing in mental health billing understand the unique codes and requirements for mental health services, reducing the likelihood of errors.
- Integration with EHR: Many clearinghouses integrate directly with Electronic Health Records (EHR) systems used by mental health providers, making the process even more seamless.
- Support for Complex Cases: Mental health cases often involve multiple sessions and treatments. Clearinghouses can help manage these complex billing scenarios more effectively.
Getting Started with a Clearinghouse
To start using a clearinghouse, providers typically need to go through a registration process. This might include providing banking information for new enrollments in electronic payments. Providers will also need to provide company-specific information and other details during this process.
How PIMSY EHR Can Help
Integrating a clearinghouse with PIMSY EHR can simplify the claims process for healthcare providers.
PIMSY is an EHR software solution that provides simplified administration processes for mental health providers and their practice.
By leveraging high levels of integration, PIMSY allows seamless communication between our EHR system and several highly-rated Clearinghouses. This integration ensures that claims are accurately formatted and error-free before submission, reducing the likelihood of denials and speeding up the reimbursement process.
Additionally, providers can easily create claims through the system, which are then transmitted to the clearinghouse for validation and submission to insurance payers.
This approach simplifies the administrative burden on healthcare providers and ensures timely and accurate reimbursement, allowing you to focus more on patient care.
Reach out today to see how we can make clearinghouse submissions work for you!
Sources:
https://prgmd.com/what-does-a-clearinghouse-do-during-claims-submission/
