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5 Steps to Better Payment Posting

Payment posting is how healthcare practices are reimbursed for patient care by third-party payers. In theory, the steps are simple. The billing team submits a claim to the insurer, the insurer issues electronic payment or check, and the payment is entered into the clinic’s billing system.

If only it were that simple.

Many patients pay for care with more than one insurer so medical billers must file claims with secondary or tertiary insurers. And, when an insurer issues full or partial denial of a claim, the billing team has to start the process all over again to see if remittance errors were made.

Accurate payment posting is crucial to medical practices because it provides:

  • a clear snapshot of the financial structure of the medical practice.

  • helps maintain a healthy revenue cycle.

Here, Clinic-ology breaks down the payment posting process to help medical billing teams become more efficient and achieve a higher percentage of first-remittance payment.

1. Claim submission. The billing team submits the claim with an Assignment of Benefits (AOB) signed by the patient. If the AOB is not submitted, the payment will be sent to the patient.

2. Claim decision. The third-party payer issues its payment decision on the claim with an Explanation of Benefits (EOB) (or Explanation of Review (EOR) or Electronic Remittance Advice (ERA)).

The EOB contains:

  • Payer name.

  • Payer address.

  • Patient name.

  • Provider name and address.

  • Member ID number, also known as the policy identification number.

  • Claim received date: when the insurer received the claim from the billing team.

  • Payment or denial date: when the payer issued or denied payment.

  • Date of Service (DOS): When care was provided to the patient.

  • CPT code, or the procedure code.

  • Billed amount, also called the charge amount for each service provided to the patient.

  • Claim number, also called the document control number or Transaction control number, assigned by the payer when it receives the claim.

If the payer approves the claim, the EOB includes:

  • Allowed Amount (AA): the amount the payer decides is fair for a specific procedure or care. AA = PA + PR.

  • Paid Amount (PA): the payer reimbursement amount. PA = AA - PR

  • Patient Responsibility (PR): the balance percentage of reimbursement the patient or a secondary insurer has to pay.

  • Write-off Amount: the amount the provider waives.

  • Check date.

  • Electronic Fund Transfer (EFT) number.

  • EFT date.

3. Denial of claim. If the claim is denied or partially denied, the billing team can:

  • Review the claim for coding or other errors and resubmits.

  • Send the claim to a secondary or tertiary payer.

  • Assign the balance to the patient account.

  • Assign payment waiver or write-off as the provider policy permits.

4. Payment posting. The billing team posts the payment using:

  • Electronic Remittance Advisory (ERA) posting: input files into the billing software the provider uses, noting and correcting exceptions after a batch run.

  • Manual payment posting: scan the EOB document and post it to the patient’s account. Write offs, adjustments and balance transfers are also entered manually.

  • Patient payment posting: enter payment from all channels: checks, point-of-service cash transactions, internet banking, credit cards, and so on.

  • Denial posting: enter if the claim has been resubmitted, sent to a secondary payer, assigned to the patient balance or waived.

5. Follow the process:

  • Receive and review the payment documents from the payer.

  • Enter the payment in the billing software under the patient’s account.

  • Analyze the EOB for over or under payment.

  • Check that the posted payment amount is the same as the deposit amount.

  • Enter if the claim is a write off, denial, adjustment, and so on, and then post the balance to patient account

  • Report denials and underpayments to the billing team.

It’s important to note that as rules and technology changes affect medical billing, processes and practices need to adjust. Billing teams handle sophisticated and sometimes even improvised technology. At the same time, bundled payments and value-based reimbursement are some of the new payment models professionals must accommodate.

A healthy revenue cycle depends on an efficient billing process and accurate payment posting, so a professional billing team is crucial for the financial health of your medical practice. Clinic-ology offers online training, onsite workshops and consulting services to implement best practices aligned with the most recent changes and advances in the billing and payment posting process.

Chicago, IL


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