Payment posting plays a pivotal role in the revenue cycle management of individual healthcare practitioners and healthcare organizations. Payment posting encompasses recording payments, depositing funds, and reconciling these numbers. The efficiency of the payment posting process significantly influences various aspects of the medical office, including patient satisfaction, operational efficiency, and overall financial performance. An efficient payment posting system is valuable for tracking daily incoming payments, including insurance payments from Explanation of Benefits (EOBs), insurance checks from Electronic Remittance Advice (ERAs), and patient payments.
Payment posting covers the following aspects:
- Patient payments: These payments can be in cash, checks, or credit cards and may cover co-pays, deductibles, or services not covered by insurance. The payments received must be reconciled with each patient’s account.
- Insurance Payment Processing: Insurance payments are received through the following methods:
- Electronic Remittance Advice (ERA): Most medical practices receive a high volume of ERAs from insurance payers. The ERAs are processed in batches by importing the transactions into the practice management system. Each batch undergoes a review process to identify exceptions (which must be promptly addressed).
- Manual Posting: Scanned Explanation of Benefits (EOBs) batches are accessed through secure FTPs or the Electronic Health Record (EHR) system and posted to the respective patient account.
- Denials posting: Posting claim denials is crucial for understanding accounts receivable accurately. Payers send back denied claims with ANSI codes for denials and, sometimes, payer-specific medical coding guidelines. Each claim denial must be recorded in the practice management system, and appropriate actions must be taken. These include re-billing to secondary insurance, transferring balances to patients, writing off amounts, or resubmitting claims for processing.
Here is an overview of the ten steps crucial to efficient payment posting in a healthcare enterprise:
- Claims Submission: Healthcare providers submit claims to insurance companies or other payers for services provided to patients. These claims include information about the services rendered, associated costs, and relevant patient and provider information.
- Adjudication: The payer reviews the submitted claims and determines how much they will reimburse the healthcare provider based on the patient’s insurance coverage, the provider’s contract with the payer, and the specific medical codes used to describe the services. The payer then sends an Explanation of Benefits (EOB) or Remittance Advice (ERA) to the provider, detailing the payment or denial of each claim.
- Receiving Payments: The healthcare provider receives payments from the payer based on the information provided in the EOB or ERA. These payments include insurance and patient payments (copayments or deductibles).
- Payment Posting: The next step is to post the received payments accurately in the provider’s billing system. This involves recording the payment amount, the date of payment, the payer, and other relevant details for each claim.
- Reconciliation: Payment reconciliation in medical billing is a crucial step and involves (a) comparing and verifying payments received (from insurance companies, government programs, or patients) with the billed charges for healthcare services and (b) comparing ERAs with the corresponding bank deposits ensures that every dollar collected is ultimately credited to your bank account.
- Identifying Discrepancies: Discrepancies can occur for various reasons, such as coding errors, contract negotiation issues, or billing mistakes. Payment reconciliation involves identifying these discrepancies and taking appropriate action to resolve them.
- Appeals and Corrections: If a discrepancy is identified, the provider may need to file an appeal with the payer to address denied claims or incorrect payments. This can involve submitting additional documentation or clarifications to support the claim.
- Balancing and Reporting: Once all discrepancies are resolved, the provider can balance their accounts and generate reports to track payment trends, identify areas for improvement, and ensure accurate financial records.
- Provider-Patient Communication: In cases where patients owe a portion of the bill (e.g., copayments, deductibles, or services not covered by insurance), the provider may send statements to patients explaining their responsibility and requesting payment.
- Continuous Monitoring: Payment reconciliation is an ongoing process in medical billing, as payments and claims are continually processed. Healthcare providers must monitor and reconcile payments regularly to ensure accuracy and maximize revenue.
Effective payment reconciliation requires attention to detail, knowledge of insurance contracts, and the ability to address discrepancies promptly and efficiently. Although providers can use specialized billing software to streamline the payment posting process, it is certainly one that requires time, resources, and updated knowledge of medical billing guidelines as well as payer policies. Given the complexity of payment posting and reconciliation, most medical practices and healthcare enterprises prefer to outsource the activity to a medical billing service.
PracticeForces has a proven track record of collecting more and faster than the benchmark in the US medical industry. We reconcile bank deposits weekly and monthly to ensure all dollars are received, and bank accounts are balanced for our clients.
Do you want to know how we do that? Let’s talk.
