Medical Claims Clearinghouse

Written by Kimberly Clark
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The medical claims forms that healthcare plans require doctors to submit for payments of service can vary greatly from one company to the next. And in an effort to cut their costs, many healthcare plans, also referred to as payers, are now requiring that healthcare claims be electronically transmitted in their specific system format. To ensure payment is received, a physician could tediously fill out each individual claims form and even attempt to modify their data so it will be accepted by the payer's electronic system, or they could utilize the services of one of the many claims clearinghouses.

Claims clearinghouses were created to simplify the physician's medical claims submission. The primary function of the claims clearinghouse is to take the data provided by the doctor's office, no matter the format, and translate it into a configuration that can be comprehended by the healthcare plan. This essentially allows the doctor to submit the necessary information, in whatever form it currently is in.

Established to perform as an intercessor between the physician's office and the insurance companies, most clearinghouses serve several different payers and are potentially responsible for translating claims information for well over 400 proprietary payer systems. The claims clearinghouses are generally paid, by the payers, on a per transaction basis at a cost of $0.10 to $0.50 per claim. In addition, most doctors pay monthly or annual fees so their data can be electronically transmitted.

Continued Need for Medical Claims Clearinghouses

As of October 16, 2003, the Centers for Medicare & Medicaid Services (CMS) requires that medical claims be submitted electronically and in HIPAA (Health Insurance Portability & Accountability Act of 1996) format. Consequently, most government payers don't use claims clearinghouses, opting instead to allow doctors free access to their systems. However, with the impending requirement that all electronic transactions be compliant with the HIPAA administrative simplification provisions, many commercial payers companies are also questioning the continued need for medical claims clearinghouses. As a result, if you are looking into investing in a new software system, you will want to look for one that allows direct as well as clearinghouse submissions.

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