Medical billing and coding are two important aspects of the medical industry related to each other. Though both are different processes but crucial for providers to receive payment for healthcare services. They both play crucial roles in ensuring accurate and efficient reimbursement for medical services provided to patients. In this blog, we will understand the basics of medical billing and coding and will also analyze the key differences between them. These details may be helpful if you are considering pursuing a career in medical billing and coding. Both medical coding and medical billing are integral parts of the revenue cycle management in healthcare facilities, and they require specialized knowledge and training to perform accurately and efficiently.

Understand Medical Billing

Medical billing is the process of creating and submitting claims to insurance companies, government programs, or patients themselves to receive payment for medical services rendered. It requires a thorough understanding of insurance policies, reimbursement guidelines, and specific billing requirements of different healthcare payers. Apart from this, proper steps are followed during medical billing. Firstly patient information, insurance details, and other necessary demographics are gathered. After that, coding systems, like CPT and ICD-10 codes are used to translate the medical services and procedures provided into appropriate alphanumeric codes. The coded information is compiled along with patient details and submitted in the required format to the appropriate payer, such as an insurance company.

Types of Medical Bills

Front-End Medical Billing

In this, the data entry of patient information is added to the practice management system of the provider. As per the information available, claims are created for the concerned patient. The process is crucial to ensure that a claim contains all the required information processes effectively.

Back-End Medical Billing

In back-end medical billing, insurance companies prepare the procedure of approvals, denials, and other correspondence. It may be performed by an in-house staff member or a biller’s representative at the provider’s practice. The provider information may encompass the information related to a healthcare facility, name of provider, NPI, service dates, etc.

Understand Medical Coding

In medical coding, the medical information is transformed into alphanumeric codes. In more simple terms, medical coding involves the transformation of healthcare diagnoses, procedures, medical services, and equipment into universally recognized alphanumeric codes. These codes are used to document and classify patient information for various purposes, including billing, insurance claims, and medical records management. Various coding systems are used throughout the medical industry. However, ICD-10 codes are most commonly used. Moreover, the primary purpose of medical coding is to accurately represent the medical services provided in a standardized format.

Types of Medical Codes

ICD-10-CM

The ICD-10 Clinical Modification is a modification of the ICD-10, authorized by the World Health Organization (WHO), used as a source for diagnosis codes in the United States of America.

ICD-10-CM (Clinical Modification) is a US clinical modification of ICD-10 by WHO. It is developed for classifying and reporting diseases in all US healthcare settings. ICD-10-CM is an expanded version of the ICD-10 codes which encompasses additional codes, greater specificity, and updated coding conventions to facilitate more detailed information related to the diagnosis of the patient. The ICD-10-CM codes are structured into three levels: diagnosis, manifestation, and etiology. It is crucial for reimbursement, medical billing, and data tracking.

HCC Coding

HCC coding is developed to predict risk and estimate the lifetime healthcare costs of the patient by inculcating different factors and conditions that may impact the individual prognosis of the patient over a longer period. Over time, the healthcare industry is moving towards a value-based model, and the use of HCC coding is becoming more prevalent. The patients are assigned a risk score as per their specificity of disease and different demographic factors. Apart from this, the RAF score is also associated with HCC coding and is used to pay more for unhealthy persons and less for healthy patients.

Key Differences Between Medical Billing and Medical Coding

Different Jobs 

Medical coders assign appropriate codes to diagnoses, procedures, and services based on the information provided in patient records. This coding helps maintain accurate and standardized medical records and aids in billing and reporting. On the other hand,  medical billers use coded information to generate claims that include details about the services provided, along with patient and insurance information. They manage the submission, tracking, and processing of claims to ensure proper reimbursement.

Billers Vs. Coders: Work With Patients

Medical billing is the process of creating and submitting claims to insurance companies or other payers for reimbursement of medical services provided. Its main goal is to ensure healthcare providers receive proper payment for their services. The primary purpose of medical coding is to translate medical diagnoses, procedures, and services into standardized codes. These codes are used for documentation, classification, and analysis of patient information.

One major difference between a career in medical billing and coding is the degree of interaction with others. For example, billers often work directly with patients, while coders do not interact directly with patients.

Degree of Autonomy

Depending on the role and facility, the degree of autonomy may differ in medical billing and coding career. Billers more or less work independently, while coders may have to work under more guidance from senior members. However, communication skills are essential for both roles as billers and coders work closely with patients and healthcare professionals. 

Final Thoughts

Medical billing and coding are separate processes, but both are necessary for providers to receive payment for healthcare services. Ensuring healthcare organizations understand the fundamentals of medical billing and coding can help providers and other staff operate a smooth revenue cycle and regain all the allowable reimbursement for quality care delivery. While billers and coders may have different responsibilities, their collaboration is crucial to ensure accurate documentation and efficient billing.