Understanding The Basics of Laboratory Billing and How Outsourcing Can Help

It is mostly seen that lab technicians, who form the bulk of lab employees, generally do not engage in the laboratory billing or coding process. This is mostly because laboratories usually accommodate their billing departments separately as it helps technicians to focus on their primary tasks: delivering accurate results and maintaining constant engagement with physicians and patients. Hence laboratory medical billing requires a unique approach to managing their billing and coding process.

All about the complex affair of Laboratory Billing Cycle

It is no secret that the billing cycle for medical laboratories is a complex process involving multiple interactions between the ordering physician, the lab providing the services, and the insurance company or other payer compensating for the services rendered. Being a confusing process, it can take several days to months to complete mostly due to the multiple engagements among the parties involved.
While the billing cycle starts with a physician or another entity ordering a lab test using a specific code. Once the sample analysis is done, labs assign a diagnosis or procedural code, providing necessary information for the insurance company to decide on claim approval.
Though the process looks simple it is not always what it is seen and so an expert professional is needed to manage it.

With two primary code sets International Classification of Diseases (ICD), maintained by the World Health Organization, provides a framework of diagnostic codes classifying diseases, symptoms, injuries, and other complaints and the Current Procedural Technology Code Set (CPT), provided by the American Medical Association, identifies services rendered giving a uniform classification for use by medical providers, coders, insurance companies, and other payers ; laboratory coding process can often be a point of confusion for many and causing denied claims. With denied or failed claims being sent back to the lab, necessitating corrections and resubmissions are often the cause of payment delay and so deterioration in the bottom line is anticipated.

Furthermore, clinical laboratories play a critical role in the healthcare industry as 70 % of medical decisions rely on lab test results. However, despite this substantial contribution, laboratory revenues constitute only 3 - 5 % of a hospital's total returns. Therefore, improving laboratory billing efficiencies from expert is very important today.

Today the focus on key performance indicators (KPIs), such as comparing expected gross billing to actual patient activity, in fact, offers insights into whether the billing cycle is keeping pace with the workflow or not. However, if you are someone struggling to manage your lab billing or your dysfunctional laboratory billing causing you increased claim denials and prolonged accounts receivable time then worry no more as you are not alone. Today 75 % of providers opt for outsourcing solutions.