With the advent of technology, the healthcare industry is transforming and billing intricacies are heightening over time. Healthcare professionals and providers are often confused with the changes in claim submission guidelines and coding regulations. A lack of understanding regarding the differences between facility and physician billing increases the complexity more and there are chances of errors and claim denials.
Both hospital and physician billing have unique characteristics, requirements and processes that impact the operational efficiency and financial stability of a practice.
In this blog we explored the key aspects that differ one from the other and how you can optimize your billing processes.
Understanding the Physician Billing Services
Physician billing often addressed as professional billing is the process of invoicing associated with the services rendered by healthcare professionals.
Key aspects of professional billing include:
- Evaluation and management codes: Physician billing solutions implement evaluation and management codes to determine the complexities of the services, time spent on the service and degree of clinical decision making. The CMS-1500 claim form is used by doctors and contains diagnosis and procedure codes, patient and provider information, and services delivered.
- Schedule of fees: The predetermined fees for the services provided by medical experts are outlined in a clear pricing schedule.
Understanding Facility Billing
This billing process is also known as facility or institutional billing encompasses the invoicing process associated with a healthcare setting. In-patient stays, outpatient procedures, emergency visits
Institutional billing process is basically associated with a hospital or healthcare facility. For instance, outpatient visits, emergency procedures, in-patient stays, surgeries and other medical services provided within the facility's premises.
The key components of facility or institutional billing are as follows-
- Facility fee: Not only the clinical services, but also the facilities provided to an individual during a visit are also covered. From bed and equipment charges to nursing care and administrative services all are billed under hospital billing.
- UB-04 claim form: The detailed information about patient’s stay, procedures performed, medicines administered, and other relevant details are incorporated within this form.
- Diagnosis-Related Groups (DRGs): Diagnosis-Related Groups, which group patients with similar conditions together for reimbursement purposes, are the basis of the payment system used by hospitals.
What Makes Facility and Physician Billing Different from Each Other?
The fundamental difference lies in the setting of the services provided. Facility billing is associated with hospital and other healthcare setting billing process.
On the other hand, physician billing is all about services associated with a healthcare professional.
While hospital or facility billing utilizes UB-04 claim forms, physician billing requires CMS-1500 claim form.
Professional billing usually follows a fee schedule based on specific procedures or services rendered. On the contrary, hospital billing charges for the additional facilities provided with the services or procedures.
Physician billing is largely relied on ICD-10, CPT and E/M codes, while the hospitals consider DRG coding system for billing.
Conclusion
Understanding the fundamental differences between physician billing services and hospital billing is crucial to optimize revenue generation and sustain stability of your practice.
By partnering with a reliable physician billing company, you can navigate the complex maze of both the billing processes.
Streamlining your operations and revenue cycle is easier now with an outsourced RCM company. At the same time, you can save up more time for patient care, improved quality and patient health outcomes.
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