Insurance Billing Basics: Steps for Therapists to Successfully Take Insurance

Insurance Billing Basics

Steps for Therapists to Successfully Take Insurance

Co-Authored by Jeremy Zug, Kathryn Zug, and Kate Perry

Who is this Book for?

Working with mental health clinicians, we’ve encountered so many providers who have a passion for their patients, are dedicated to their field, and want to make a difference in the lives of others. The insurance billing process often stands in the way of these providers achieving these goals, creating headaches, sleepless nights, and anxiety over running a practice. Every provider is capable of running a financially viable practice that accomplishes the therapeutic mission with the right knowledge and tools.

This resource is for mental health clinicians who have recently completed grad school and want an introduction to insurance billing, who are starting their private practice, who are new to accepting insurance for their patients, or who are experiencing chronic issues with their insurance billing.

In the healthcare industry, very few educational resources are about the revenue cycle and revenue cycle management for private practices. Our goal is to educate providers so that they can make the best decisions for their practice. Our expertise comes from our billing services that remove much of the burden of insurance billing from providers like you. This resource was developed by collating and expanding upon topics that we had written about on our blog, placing them into a framework that gives a big picture on insurance billing in private practice. Even if they are using our billing services, we always encourage providers to be educated on what their biller is doing and how it helps their business. We would be honored if you choose us as your billing partner.

Most importantly, we want you to understand the insurance billing process and make decisions with all available information. You care for the future of your practice, and so do we!

Our mission is to empower you to focus on patient care by educating you about best practices in the revenue cycle management process. We want to create and communicate clarity in a confusing, frustrating, outdated industry. Health insurance and reimbursement do not have to be the elusive creature you may fear or think it is. Practice Solutions can help you on your insurance journey in whatever capacity we can, beginning with this book. It is one of the most thorough treatments on insurance billing for beginners, compiled using our experience helping thousands of providers with their insurance billing. We wish we had this book when we were starting!

This book was designed by Practice Solutions to give you both a high-level overview of the insurance billing process and more detailed instructions on how to manage each stage within your private practice. We used a textbook-style format to deliver the information in a way that we felt made sense, with concepts and principles building on each other as you read the book. We started with basics and then dug deeper as we went.

For this book, we assume that you already are established with an NPI, tax ID, and articles of incorporation for your business. If not, you can use these instructions on how to apply for an NPI or this NPI application form that can be mailed. You can reference these instructions to apply for an EIN number. You should learn to register your business within your state and follow those procedures. We intend that you use the information in this book to inform the development of your processes for insurance billing within your private practice and to use this information to help you make the best choices for your business. The ultimate goal is that this book enables you to develop a successful therapy business, serving the population you want to serve while bringing in reliable payment from insurance.

Each chapter of the book will end with action items that you can do based on the knowledge that you learned. These action items are meant to help you set up a process for revenue cycle management that works for you and your practice. We recommend reading this book in companion with a blank notebook where you can plan.

At the end of this book, we hope that you have a clear understanding of insurance billing from start to finish, who the key players are in the process and that you feel confident in revenue cycle management so that you can work with your patients at the practice of your dreams.

Index

Chapter 1: The Basic Process of Working with Insurance

Credentialing

Billing: Revenue Cycle Management

The Ethics of Insurance Billing

Practice Solutions: Your Revenue Cycle Management Partner

Chapter 2: Deciding Which Insurance Payers to Work With

The Value of Goal Setting

Determining Your Insurance Mix

The Most Profitable Mixes

The Fewer the Insurance Companies the Better (But Meet Your Goals!)

Identifying Your Best Insurance Partners

Chapter 3: How to Get Credentialed

Decide Who is Completing Your Credentialing

Credential Yourself

Outsourcing

What You Will Need to Complete the Credentialing Process

Completing the Credentialing Paperwork

Following Up on Credentialing Applications

The Contracting Process

Chapter 4: Preparation for Billing

Selecting an EHR

Setting Up Online Insurance Portals

Setting Up Electronic Claim Submission and Remittance

Chapter 5: Establishing Patient Relationships

Create Your Patient Paperwork Documents

How to Acquire Patients

RCM Stage 1: Pre-Registration

RCM Stage 2: Registration or Patient Intake Process

Chapter 6: Eligibility and Benefit Checks

The Difference Between Eligibility and Benefits

How to do an E&B Check

How to Interpret Eligibility and Benefit Information

Chapter 7: Completing Sessions

RCM Stage 3: Charge Capture

Coding for Billing

Completing Notes

Chapter 8: RCM Stage 4: Claim Submission

What is a claim?

What information is on a claim?

How to Submit a Claim

The Role of a Clearinghouse in Claim Submission

Chapter 9: RCM Stage 5: Payment Posting

EOB or ERA

How to Read and Interpret EOBs and ERAs

Payment Posting

Receiving Payments

Aging Reports

Chapter 10: RCM Stage 6: Claim Follow-Up

Identify Which Claims Require Follow-Up

Decide the Best Course of Action for Each Open Date of Service

How to Resolve a Rejection

How to Resolve a Denial

The Importance of Claim Follow-Up

Chapter 11: RCM Stage 7: Outstanding Patient Collections

What to Collect

How to Collect

Chapter 12: Final Thoughts

Further Reading: Advanced Billing Topics

Practice Health Check

Insurance Billing Services

Chapter 1: The Basic Process of Working with Insurance

First, let’s take a look at a general overview of the billing process. We’ve broken this down into two categories: Credentialing, which would take place before any claim submission but is integral to the billing process, and Billing, otherwise known as Revenue Cycle Management.

Understanding these two principles and how they relate will be key to your success as a private practice accepting insurance and will put you ahead of the rest.

Credentialing

Defining Credentialing

Credentialing is the process by which a provider becomes In-Network with an insurance plan and, through that affiliation, can accept third-party payment. For an insurance company to allow you into their network and establish a contract with you for service reimbursement, they must verify your credentials such as proof of education, NPI, Tax Information, business name and address, among other information - hence the name credentialing. Credentialing should be completed before accepting insurance patients and before any insurance billing occurs for the smoothest billing experience.

Paneling is another name for the credentialing process, since as a result of credentialing you are added to the insurance company’s panel. An insurance panel, also known as a provider panel, is a list of healthcare providers (including therapists) who are approved to provide in-network services to patients under a specific insurance plan.

An Overview of the Credentialing Process

To become credentialed with an insurance company, you will first want to confirm with provider services that each network you want to join is accepting new providers. If they are, you will need to complete an application with each insurance company you would like to become credentialed with. The easiest way to obtain these applications is to go to an insurance company’s website and locate their provider resources area. From there, you may be able to download an application or get in touch with someone in the provider services area of the insurance company who can assist you in obtaining an application.

Once you have an application, you can complete the application with all of the requested information. The application includes your NPI number, tax ID, business name, and business address. It is important to note that whatever information you submit on your credentialing application will be expected to match what you submit on future insurance claims. You will want to have a record of the information you submitted and make any updates, such as a change in address, with the insurance company when necessary. In the application process, the insurance company may request copies of various forms of identification, which we will cover in-depth in Chapter 3.

Upon completion of the application (and triple-checking everything), it is sent to the insurance company, and it can generally take between six months and one year for your application to be reviewed and processed. This timeline is variable depending on many factors, such as the insurance company’s application volume, processing time, and the accuracy of your documentation submission. If accepted, you will receive notice and a contract to review, sign, and return to the insurance company. The insurance company will then process the contract and notify you when you are officially In-Network. You should be provided with a copy of the finalized contract, signed by both you and the insurance company that you need to save to your records for future reference. It is at this point that you would be able to begin billing for insurance.

How Often Do You Complete Credentialing?

If you want to accept insurance from your patients, credentialing should happen before billing. Once credentialed, you must comply with any re-verification requirements outlined by the insurance company to ensure that all of your information is still valid. You must complete the re-verification process even if none of your information has changed. This process allows the insurance company to confirm that you are still an active provider and want to remain on their list of in-network providers. Most insurance companies require re-verifying your credentialing at varying frequencies, but you will typically need to renew your credentialing after three years.

The re-verification process is simple if all of your information is the same. Just make sure that you complete it! Look out for any notices from the insurance company, or note the timeframe for re-verification designated in your contract and be proactive about completing it with the insurance company. If you do not re-verify, you will likely be removed as an in network provider with the insurance company and a new application would need to be submitted.

Suppose any of the following information has changed. In that case, you will need to update your existing credentialing:

●Your Practice Address

●Your Practice Name

●Your Name (common reasons include marriage and divorce)

●Your Tax ID (This would typically be to correct an error, or if you decide to change from using your SSN to an EIN and all other information remains the same)

●Your NPI (This would typically be to correct an error)

If any of these circumstances apply to you, you will need to submit an entirely new credentialing application:

●You previously worked for a group practice credentialed under their group NPI and Tax ID and you now work under your practice

●You previously worked for a group practice credentialed under their group NPI and Tax ID and you now work for a different group practice. Consult your new employer on their credentialing processes

●Your practice has moved from one state to another

●You were credentialed as an individual and would like to credential your practice as a group using a type 2 NPI

Can You Bill Insurance Without Credentialing?

If you