How Is Medical Insurance Billed?

The sheer number of health procedures and treatments causes system complexity and maintains friction between medical insurance companies and health care providers. In the past, the medical insurance billing process was often a harangue of flea market haggling. In 1997, the industry's adoption of medical billing codes sped up the processing of medical insurance claims.

Medical Insurance Billing Process

A walk through the medical insurance billing process in a typical physician's office begins with an evaluation to assign a "level of service," to a patient's office visit. It takes experience to make this appraisal and the considerations are defined in the 'Current Procedural Terminology' (CPT), the standards maintained by the American Medical Association. The 'level of service' is converted to a CPT 'procedure code,' and the Doctor's diagnosis is converted to a 'diagnosis code.' Now, through this efficient codification process, the information that is relevant to medical insurance bill has been milled down to a couple of codes, just of several digits each. Finally, even the claim delivery process is standardized as a system of electronic delivery of the medical insurance provider that looks a little like muscled up email, even though the medical insurance industry has distaste for the comparison.

In the invoicing process, the medical insurance company works between patients and health care providers to a degree that makes it seem pointless to look at your medical bill. It is just a printout of unintelligible codes anyway. It is worth a look. It is common that every few years, some friend, neighbor, cousin or colleague decides to take apart that hospital bill. Usually they find over-billing to their medical insurance so outrageous that the purposefulness of the hospital's actions is clear.
Patient anger over the nature of a small minor charge sometimes exceeds the insult of the total amount of the "errors." Billing a man's medical insurance is an affront, but charging for an adult diaper is to bring his continence under question.

There are plenty of opportunities for the misuse of medical insurance. One morning during your hospitalization, your doctor pops his head in the door. He smiles, gestures a subtle wave and inquires, "How are you feeling?" Before you can answer, he bounces a quick nod and darts up the hospital hall. When you are released from your stay and get a copy of the hospital's claim to your medical insurance, examine it thoroughly.

Do not be surprised if those three seconds are reflected on your bill as an eight hundred-dollar medical consultation. On reflection, you might feel that the brief encounter had more in common with a 'Drive by shooting' than an act of medical insurance billable health care.

We all should at least check our bills for accuracy with the same healthy suspicion we count our change. If a large number of patients requested the code translations or itemized versions of medical insurance claims, it could make a difference in the cost of medical insurance.