Research Paper: Health Care Insurance (Research Paper Sample)

Research Paper: Health Care Insurance
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Research Paper: Health Care Insurance
Medical billing is a common payment practice in the US health care system. It is a process whereby a health care provider claims for payments from health insurance companies for medical and health care services rendered to a patient subscribed to the specified insurance packages. In this process, the health care provider obtains insurance information from a patient, files a claim, and follows it up. If need be, they can also appeal such claims. These claims are invoices for services rendered to the patient and are the object of medical billing. For medical billing to be effective, medical billers should verify certain steps that include patient registration, insurance verification, patient and health care provider encounter, medical transcription, medical coding and charge entry, claims transmission, and payment posting. In most cases, the medical biller acts as the third-party responsible for ensuring claims are paid. Billing services are outsourced to billing companies because they possess the requisite technology, systems, experience, and resources to follow up on unpaid claims. A profound examination of the billing processes, submission of claims to the hospital and medical office, job functions of a medical insurance processor, as well as the deductibles, copays, and coinsurance will explain the concept of medical billing in an in-depth analysis.
Literature Review
According to Gottlieb, Shapiro, and Dunn (2018), the administrative costs of providing health insurance in the US are high. The authors assert that the costs, in terms of challenged annual revenue, lies somewhere between $11 billion and $54 billion. Such high costs arguably have profound implications in the health care sector and directly affect health insurance reforms in the US. The research incorporated in their study indicates that the US spends up to 30% of its health care resources on administrative costs alone (Gottlieb, Shapiro, and Dunn, 2018). The most common administrative cost is the billing process and payment for medical care.
Just as Gottlieb, Shapiro, and Dunn (2018), Center for Medicare and Medicaid Services (2020) assert that both Medicare and Medicaid are health care programs where the former is a federally run program while Medicaid is a state-based program. According to them, Medicare employs a set of rules applied across the entire country, while Medicaid incorporates rules and procedures that apply in specific states. For instance, Medicaid rules in California are not necessarily the same rules in New Jersey. Both articles, "Medicare Claims Processing Manual" and "Electronic Health Care Claims" by the Center for Medicare and Medicaid Services, assimilate factual information related to health care insurance, and the former article provides a detailed review of how health care providers, medical billers, and payers work together to ensure effective settling of claims. Additionally, the South Carolina Department of Insurance (2017) and Green (2020) utilize a base timeline of fewer than five years, recognizing the sector's dynamism to express their conclusive statements on the issue of medical insurance and processes therein.
Methodology
The study incorporated is based on secondary sources of data. Secondary sources of data are reliable sources of data because of their verifiable and authentic nature. The Centers for Medicare and Medicaid Services (CMS) proves as an integral part of the research because of the vast, rich information it has on medical insurance and health claims. The CMS is an integral branch of the US Department of Health and Human Services, and it oversees various federal health care programs such as Medicare and Medicaid. It also integrates health information technology in various systems that health care providers and other stakeholders can access.
Medicare Billing Processes
According to CMS (2020), the Medicare program was established in 1965 and is overseen by the Centers for Medicare and Medicaid Services (CMS). About 71 million Americans have been enrolled in the program. CMS (2020) asserts that the program is divided into four coverage plans: Part A, B, C, and D. Part A covers inpatient care in a health care facility, while Part B covers other necessary medical costs not addressed by Part A. Such costs include therapy services and outpatient physician services. Part C is a cover offered by private companies and incorporates both inpatient and outpatient coverage. Finally, part D is a prescription drug plan given by the companies.
CMS (2020) states that the billing process is simple. Firstly, after the patient sets up an appointment with their doctor, they are registered and become eligible for service provision. Secondly, the biller has to ascertain the party that will bear financial responsibility, whether the insurance company or patient. Thirdly, the patient completes the patient check-in and check-out forms and afterward prepares a claims form. This check compliance is the fourth step, and the fifth involves the transmission of a claim. After the claims are transmitted, the payer conducts adjudication to evaluate the claim, assess its validity, and ascertain the amount it would pay. CMS (2020) suggests that it is at this stage that a claim is accepted or rejected. After the payer issues its report to the biller, the latter generates a statement for the patient, which incorporates the bill for the procedures and services. The last phase of the billing process is to ensure the bills are paid.
Submitting Claims for a Hospital
Over the years, manual processes have been replaced, and now payers require claims to be submitted electronically. Once the health care provider transmits the claim to the medical biller, the latter assesses the payer or insurer's amount to pay, provided in the contract between the patient and the provider. The biller is mandated to ensure the medical claim meets compliance standards, both in format and coding. Before transmitting the claim to the payer, the biller must ensure that the claim comprises the name of the provider, physician, and patient, the procedures incorporated, and the codes for diagnosis. These standards of billing compliance are laid out in the Health Insurance Portability and Accountability Act (HIPAA) and the Office of the Inspector General (OIG) (CMS, 2020). After this process, billers are required to transmit the claims to the payer, where it undergoes adjudication after reaching them. Adjudication is the process whereby the payer assesses the validity and compliance of the claim and ascertains the amount it will reimburse the health care provider. The payer can accept, reject, or deny the claim. Afterward, the payer submits a report to the biller or provider on the amount they are willing to pay. Once the report is received, a statement or bill is made for the patient, illustrating how much the payer has agreed to pay and the amount the patient ought to top-up for the rendered service.
Deductible, Copays, and Coinsurance
A deductible is a type of clause initiated by the insurer where it dictates the amount or percentage of a bill the client needs to pay before it caters for any medical expenses on its part. The deductible is a fixed amount of money that the policyholder is mandated to pay. Conversely, copay can arguably share the same concept as deductible. Copay refers to the position whereby the policyholder of a medical cover and the insurer agree to incur medical expenses together in case of an event. The main difference between a deductible and a copay is that the former is levied to guard the insurer's interest against unnecessary or recurring claims. According to South Carolina Department of Insurance (2017), coinsurance represents the percentage of treatment costs that the insured must incur after paying the deductibles. While the insured or policyholder bears the expense when seeking health care services in copay, coinsurance requires them to accept bill statements from the insurer and pay directly to them.
Job Functions of a Medical Insurance Processor
The insurance processor is responsible for reviewing the claim and ensuring it aligns with the benefits stated i