7 Medical Billing Tips for Small Practices

7 medical billing tips

The following easy-to-implement best practices can help make your medical billing process simpler, more accurate and more effective.

1. Verify your patients’ information.

When filing medical claims, knowing your patients’ basic information is as important as recording how you cared for them. Take these steps for accurate, straightforward patient information on all your claims:

• Ask for patient demographics and contact info. Explicitly asking for updated contact information is crucial. For example, if you ask, “Is your information up to date?” or “Has your information changed?” your patient might not be sure how recent the information is. However, if you ask, “Is your address still X?” instead, the patient can immediately identify errors.
• Verify patient health insurance. Patients may be unaware their insurance information is out of date. During intake, ask the patient to provide their insurance ID, policy number and (if applicable) group number. Once you have this information, contact the insurer to verify the patient’s coverage and benefits. Ask about copays and remind the patient of those as well.

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2. Set clear patient payment terms.

Let’s say you’ve taken the first step and know your patient’s insurance will cover your services with an $80 copay. You’ll want that $80 from the patient sooner rather than later. Take these steps to make that happen:

• Clearly state what patients owe and when and how they should pay. Don’t assume patients will know their copay amount when you check them in. Instead, tell the patient they have a copay during their check-in and request the payment then and there. Ask for upfront payment, but be flexible if the patient can’t afford to pay immediately.
• Establish a patient communication workflow. Let’s say a patient can’t afford their copay at the time of their appointment. In that case, you’ll need to keep in touch with them until they pay by using payment reminder letters or electronic reminders. If you go the electronic route, automate message delivery based on how long the patient has owed payment. Monthly payment plans may be an acceptable alternative when patients can’t pay immediately.
• Send patient statements as necessary. Ideally, your patient will owe a copay, and their insurance will take care of the rest. But it isn’t always so simple. If the insurer denies some or all of the claim, payment for the remainder falls on the patient. To convey this news, send patient statements detailing the claim and which parts the insurer declined to pay. The insurer should send the patient an explanation of benefits (EOB) with the statement for further insight.
• Determine how to address nonpaying patients. Unfortunately, patients who don’t pay their bills are inevitable. You’ll need reliable workflows in place to reach them and successfully solicit payments. Decide which communication channels feel most discreet and effective for reaching the patient. Determine when denied claims should be appealed to the insurer instead of sent to the patient (who can then appeal denials on their own). Make starting the debt collection process an absolute last resort.

3. Offer digital payment options.

Digital, automated options can make client payments easier and more reliable than collecting fees in the office.

“Keeping a credit card on file … holds patients accountable and is the most reliable solution for maintaining a steady, consistent cash flow for your practice,” noted Vaida Newara, director of revenue cycle management of EZDERM.

Some practices also provide patient portals, giving patients responsibility and control over their payments and information. 

“These portals allow patients to view their bills, make payments and set up payment plans directly, reducing the workload on your billing department and improving the patient experience,” explained Dr. Danielle Kelvas, MD, medical advisor for IT Medical.

Digitizing the payment process also aligns with consumer payment trends. According to a Flywire survey, 30 percent of healthcare consumers still use checks to pay medical bills — but seemingly not out of preference, considering the 3 percent rate of check use in the retail industry.

“Patients want to pay more of their bills online in their patient portal — for themselves and their dependents,” said John Talaga, EVP and GM of Healthcare at Flywire.

4. Determine how you’ll handle rejected and denied claims.

No matter how much work you put into rigorously checking your claims before filing, rejections and denials are inevitable. What happens next is up to you and can have a noticeable impact on your cash flow and billing costs.

• Rejected claims: A claim is typically rejected due to errors or missing information. The good news is that handling rejected claims is usually straightforward. Look at the errors the payer indicated, correct them, and resubmit the claim. This process is typically quick and pain-free, even if the time between resubmission and payer reimbursement is long.
• Denied claims: Denied claims are another matter entirely. When claims are denied, payers should provide you and the patient with EOBs to explain the issue. However, they may forget to include EOBs with their denials, leaving you in the dark. Even if they do provide EOBs, you must make a decision: Is filing an appeal worth the time and money? While you might be able to offload the burden of appealing a denial to the patient, it’s not uncommon for practices to do so on the patient’s behalf. 

Andrew MacDonald, senior vice president of Revenue Cycle Management at NextGen Healthcare, recommends practices develop a library of actions and standard procedures to appeal denied payments. This, along with regular analysis of billing data, can reduce lost revenue and reveal any trends or inefficiencies.

“For instance, identifying recurring coding errors and addressing them with automated rulesets can lead to a faster, smoother billing cycle,” MacDonald added.

5. Leverage technology to improve accuracy.

Take advantage of automated tools and software solutions to streamline the billing process and reduce the likelihood of errors. For example, the best medical software platforms can significantly expedite the intake process and help increase accuracy, improving the odds of fast payments.

“Small practices benefit enormously from automating their billing processes, which reduces errors and streamlines claims management,” shared Jim Boswell, CEO of OnPoint Healthcare Partners. “Using a billing system that integrates seamlessly with their EHR (electronic health records) is a huge help, as it syncs patient records, claims and payments, reducing manual mistakes and saving time.”

6. Consider outsourcing your billing.

Beyond leveraging in-house technology, you might also consider outsourcing your billing entirely to a top-notch third-party medical billing service. With this approach, you entrust your entire cycle to an external full-time staff of medical billers and coders instead of your own front-office staff. In doing so, you free your team’s time for patient-facing matters and hand over your revenue cycle to highly qualified experts. These experts often have access to powerful, exclusive claim scrubbing and denial and rejection management tools.

7. Keep up with your field of specialty.

No matter what experts and software you have in your backyard, stay in tune with shifts in your specialty and the general medical world. That might include changes to state medical laws and updates to CPT-10 and ICD codes. Such alterations can lead to changes in your medical billing and coding process big enough to result in rejected or denied claims.

To avoid that fate, keep an ear to the ground and provide your staff with the necessary training and resources to stay up to date. The result will be an easier medical billing process for your team and more revenue for your practice.

4 common medical billing mistakes

According to Experian Health’s State of Claims 2024 report, 73 percent of respondents agree claim denials are on the rise, and 67 percent feel it takes longer to get paid. To reduce the likelihood of denials and delayed payments, avoid these common medical billing pitfalls:

1. Incorrect claims data

According to the State of Claims report, missing or inaccurate claims data is the top operational challenge behind claim denials. Before filing your claims, check the patient’s demographics, insurance information and provider, as well as your ICD or CPT codes.

Claim scrubbers can also help minimize the likelihood of incorrect medical coding. These automated programs, which often come with third-party medical billing services and clearinghouses, match all codes on your claims with the actual services for which you’re billing. The program will flag any mismatches as errors and tell you how to correct them. Of course, like all software programs, claim scrubbers aren’t perfect, so you’ll want an expert medical coder to examine the findings before making the changes.

In addition to double-checking each claim, MacDonald advises practice owners to stay current on coding regulations and payer policies. Inaccurate coding and a lack of authorization can hinder timely payments, particularly with complex, high-reimbursement procedures.

2. Changes in patient insurance information

If your practice only verifies insurance information at intake — or when the patient reports a change — you may be inadvertently submitting inaccurate data.

“Insurance details change frequently, and without routine checks, practices risk processing delays,” Boswell cautioned.

Beyond annual open enrollment periods, insurance benefits can change with life events, new jobs or even slight adjustments in employer-sponsored health insurance plans. Ideally, your practice should verify insurance information at every visit to avoid billing issues.

3. Failure to meet payer policies

Even if all your data is accurate, your claims could still be rejected or denied if they don’t meet the payers’ deadlines or other policies.

“Timely claim submissions and adherence to payer policies are essential,” Newara emphasized.

The definition of “timely” will vary by payer; some private insurance companies set timely filing limits as low as 30 to 90 days, while standard Medicare plans allow up to one year. Review the individual deadlines and policies for each payer you contract with.

4. A lack of follow-up on claims issues

Failing to follow up on outstanding, rejected and denied claims can limit your cash flow — and leave your patients in the dark about their responsibilities. However, achieving proper resolution on denied claims can require multiple rounds of provider appeals, a Premier survey found.

Though thorough follow-through is common for larger practices, it can be more difficult for smaller ones with fewer internal resources. To manage this issue, MacDonald recommends smaller practices develop a system for tracking claims to identify those requiring resubmission or appeal.

Max Freedman contributed to this article.