What’s the Difference Between Institutional Billing vs. Professional Billing?

institutional billing vs professional billing

Medical billing is an essential aspect of operating a healthcare clinic. However, those who strive to run a practice often do so because they want to deliver their patients quality care, not because they want to pore over financial records.

Unfortunately, without a proper understanding of medical billing, you won’t keep your clinic’s lights on long enough to establish yourself as a worthy care provider.

One way to navigate your clinic’s finances hassle-free is with help from PracticeForces, a professional medical billing solutions company. However, once you understand what medical billing is and the differences between institutional billing vs. professional billing, you might be able to handle the clerical work on your own.

What is Professional Billing?

Professional billing controls claims for all outpatient and inpatient services provided to clients with medical coverage. Additionally, professional billing encompasses all administrative work within a medical clinic. This work includes scheduling appointments, supplying clinics, or any service outside a hospital or similar institution.

What is Institutional Billing?

Institutional billing is responsible for claims in specialized outpatient and inpatient facilities, including hospitals and nursing establishments. However, institutional billing stretches even further and includes radiology and laboratory services claims.

Essentially, any services outside a traditional healthcare office and within the walls of a specialized medical facility fit under institutional billing.

Most Significant Differences Between the Billing Types

When comparing their surface-level descriptions, there might not be much difference between professional and institutional billing. However, when you look closer at the purposes they serve and how medical billers perform them, minor discrepancies begin to separate them.

Differing Forms

Institutional and professional billing require different forms to complete, each needing separate knowledge  to fill out correctly.

For institutional billing, you will need either a UB-04 or 837-I form, the latter being the electronic version of the former. On the other hand, professional billing requires a CMS-1500 to complete physically and an 837-P to finish digitally. 

Roles Addressed

The most apparent difference between institutional billing vs. professional billing is how each method completes claims for different jobs and industries.

Professional billing primarily addresses administrative medical roles and physicians working in a medical office rather than a hospital. Therefore, you will need either a CMS-1500 or 837-P form for claims specific to those roles. Meanwhile, hospital doctors and the medical professionals performing laboratory services will need one of the two institutional billing forms.

How Professional Medical Billers Can Help

Even when you understand the differences of institutional billing vs. professional billing, medical billing is a handful to manage. However, you won’t have to do it alone with help from the medical billing experts at PracticeForces.

Consulting our team is the most effective way to handle your clinic’s finances. Not only do we have a staff of trained billing professionals with the best billing software available, but we also understand the importance of being able to access private health information. Therefore, we will treat that access as carefully as you would to ensure its security.

Call PracticeForces today at (727) 499-0351 or click here to learn more about advanced beneficiary notices.

Parul Garg, CEO and co-founder of PracticeForces, has significantly contributed to the growth of over 1,000 U.S. medical practices through her expertise in medical billing and coding since the company’s inception in 2003. With a background in Computer Science and an MBA in Human Resources, her leadership and AAPC-certified coding skills have been pivotal in managing the company’s operations effectively.

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