It is only in rare instances that a patient is not responsible for at least a portion of the expenses incurred for medical services. Even when patients are covered by healthcare insurance, the terms of their policy usually require them them to pay for a portion of the fees attached to the codes that are used to submit healthcare claims.

Every Healthcare Policy is Different

Professional medical billers understand the many different kinds of medical insurance coverage. Whether a patient is covered by commercial health insurance, or by a government healthcare plan, third-party payers tend to include the patient when paying for medically necessary services. Though there was a time when medical insurance paid for one hundred percent of a bill, and some policies still do this, since the 1980s, insurers have tended to make patients responsible for a larger percentage of their healthcare bills.

Medical billers who regularly post payments to patient accounts know that the three main terms under which patients have to pay out-of-pocket for expenses is through deductibles, co-insurance, and co-payments. These three types of patient obligations may be spread differently over different policies, and they may apply to different services.

How Medical Billers Handle Deductibles

A deductible is the amount a patient must pay out of his or her own pocket before full healthcare insurance kicks in to cover medical claims. At the time of service, the healthcare provider translates the patient encounter into universally understood standardized codes. For an office visit that requires an intermediate level of professional evaluation and management to treat a patient’s medical complaint, the provider may code the encounter 99213.

A trained medical biller or certified medical coder confirms that this code accurately reflects the level of service provided, and submits this code to the patient’s health insurer. The insurer then reviews the claim and assigns an appropriate monetary value according to the fee schedule contracted between the insurer and the provider. If the patient has not yet met his or her annual deductible, the patient is responsible for paying this amount, rather than the charge submitted by the provider.

When medical billers or other office staff verify a patient’s eligibility at the time of service, the insurer will let the office staff know whether or not the patient’s deductible has been met. Aware of the fee schedule, some offices request that the patient pay this amount at the office. More often, the bill is submitted, processed, and then the patient is billed the determined amount due.

Deductibles vary from policy to policy. Policies that have high deductibles are less costly to patients than policies with a low, or no, deductible. Once a patient meets his or her deductible, full benefits are paid by the insurer. This can take several months if a patient only receives routine care, or it can be satisfied rather quickly if a patient has an acute medical condition that requires expensive intervention. Even after full benefits start to be paid, the patient will still have a financial obligation, either in the form of co-insurance or co-payments.

Billing for Co-Insurance

Most healthcare policies that have a built-in deductible also have co-insurance attached after the deductible is met. This means that the third-party payer is responsible for a set percentage of the agreed-upon fee, with the patient responsible for the remaining percentage of the fee schedule. Most medical practices choose to collect co-insurance after an insurance company or government healthcare program processes claims. They do this by sending the patient a bill after insurance payments have been posted and contractual write-offs have been performed on the patient’s account. Professional medical billers are specialized bookkeepers who manipulate accounts receivable according to the contractual obligations between provider, patient, and insurance plan.

The patient’s responsibility may be ten percent, fifteen percent, or more, depending on the terms of their policy. Some services may be exempt from co-insurance, such as laboratory tests, but this varies by third-party payer and by the particular terms of each subscribed insurance contract.

Billing for Co-Payments

A co-payment, or copay, is a set amount that the patient pays at the time of service, when a patient sees a health care provider. This is more common with commercial HMO and PPO plans than it is with government healthcare plans. That said, some Medicaid programs, depending on the state, incur copays for services. In 2012, Tricare, the federal program that covers the medical expenses of military dependents and retirees, obligates a $12.00 copay from patients under one of its programs. Whether a healthcare encounter is coded 99213 or 99215, the co-payment is the same.

A co-payment is an obligatory sum due from the patient at the time services are received. Medical billers flag patient accounts so that front desk staff knows to collect this service at the time the patient checks in to receive services. When the copay model was first introduced in the 1980s, the amount was usually five or ten dollars. In 2012, the amount may be as much as $50.00 per encounter with a healthcare provider. Patients are informed of their obligation by their insurer when they subscribe to a particular policy, and they are expected to have the money on hand when they arrive in the office. Bills should never be sent to patients for copays; they are due at the time of service, and providers can legally refuse non-emergency services if the copay is not received at that time.

The Medical Biller’s Role

Professional medical billers do not bill patients more than what their insurance polices require. By having a thorough understanding of their legally mandated duty to bill according to contractual obligations, patients can be assured that they are not overpaying for services, and the healthcare reimbursement system runs smoothly without fraud or abuse. An insurance contract promotes financial transparency, and all the involved parties benefit from it. Professionally trained medical billers ensure that this is the case with every patient encounter.