Aging Accounts Receivable (A/R): The portion of accounts receivable that remains unpaid, categorized by the length of delinquency. It includes outstanding balances from self-pay patients and unpaid insurance claims, typically grouped into time intervals (e.g., 0–30, 31–60, 61–90, and over 90 days) to track how long payments have been overdue.
Applied to Deductible (ATD): The amount of money your insured client pays that goes towards paying their annual deductible. The amount of the deductible can vary, depending on insurance plan and provider.
Assignment of Benefits (AOB): Insurance payments paid directly to the provider. This transaction happens after you have submitted a claim and it has been successfully processed by the insurance company.
Attending Physician: The physician with primary responsibility for a patient’s care during a hospital stay or treatment episode. The attending physician oversees diagnosis, treatment planning, and coordination of care, and may supervise other providers involved in the patient’s care. In medical billing, the attending physician is often listed on claims for inpatient or facility-based services. In some cases, the attending and rendering physician can be the same person, but not always.
Authorization: Prior approval required by an insurance company before certain medical services are provided. If authorization is not obtained in advance, the insurer may deny coverage for the service, leaving the patient responsible for the full cost.
Beneficiary: The person designated to receive the benefits or payouts from an insurance policy. The beneficiary does not have to be the same person who owns or pays for the policy. Enrollee is another term for the insured person.
Billing Provider: The individual or organization legally responsible for submitting claims and receiving payment for healthcare services. The billing provider’s information (such as name, NPI, and address) appears on the claim form and may differ from the rendering provider who performed the service.
Clearinghouse: a third-party service that acts as an intermediary between healthcare providers and insurance payers. It checks medical claims for errors, formats them correctly, and securely transmits them to the appropriate insurance companies for processing and payment.
- Office Ally, Change Healthcare, and Jopari are the clearinghouses integrated with OptiMantra.
Clearinghouse Rejection: occurs when a medical claim is not accepted by the clearinghouse due to errors or missing information. This means the claim never reached the insurance payer and must be corrected and resubmitted.
Clinical Template: A pre-formatted structure used to streamline and standardize clinical documentation. Clinical templates help providers record patient information consistently and efficiently by offering reusable text, prompts, or fields. In OptiMantra, clinical templates are found under Settings > Clinical Templates. Examples include:
- Dot-Phrase Template: A shorthand charting tool that allows clinicians to insert pre-written text into notes by typing a trigger (e.g., @normal_MSE). This saves time and ensures consistency in documenting common content such as mental status exams or patient instructions.
- SOAP Template: A structured format for documenting patient encounters using four sections: Subjective, Objective, Assessment/Diagnosis, and Plan/Services.
- More on Clinical Templates Here
CMS-1500 (HCFA) Form: a standardized claim form used by non-institutional healthcare providers (such as physicians, therapists, and other individual practitioners) to submit billing information for outpatient and professional services to insurance payers, including Medicare and Medicaid; can be on paper or billed electronically.
- It includes information such as patient demographics, diagnosis codes (ICD-10), Procedure codes (CPT/HCPCS), provider and facility information, and insurance and payment details.
Coding: In insurance billing, coding refers to the process of translating healthcare services, procedures, diagnoses, and supplies provided to a patient into standardized medical codes. This includes CPT codes (Current Procedural Terminology) for procedures and services, diagnosis codes (typically ICD-10) for the patient's condition, service units to indicate the quantity of services provided, and modifiers to give additional context or specify variations in the service performed. Accurate coding ensures proper claim processing and reimbursement by insurance companies.
Co-Insurance: Co-insurance is the percentage of the cost of a covered healthcare service that a patient is required to pay after meeting their deductible. The insurance company pays the remaining percentage. For example, if the co-insurance is 20%, the patient pays 20% of the service cost while the insurer covers 80%. Co-insurance amounts vary depending on the insurance plan.
Coordination of Benefits (COB): A process used in health insurance to determine the order in which multiple insurance plans will pay when a patient is covered by more than one policy. COB ensures that the total payments from all insurers do not exceed the cost of the healthcare services provided.
Co-Pay: A co-pay (or copayment) is a fixed amount that a client is required to pay out of pocket at the time of receiving a medical service or treatment. It is typically due before or at the time of the visit and is separate from the deductible. The co-pay amount varies depending on the client’s insurance provider and specific plan.
CPT (Current Procedural Terminology) Codes: codes are developed by the American Medical Association (AMA) and are used to describe services and procedures provided by healthcare professionals.
Deductible: The deductible is the amount a client must pay out of pocket for covered healthcare services before their insurance plan begins to share the cost. Only after the deductible is met will the insurance start to pay its portion of eligible expenses, according to the plan's terms. Deductible amounts vary depending on the insurance policy.
Diagnosis/ICD-10 Codes: codes used to classify and identify medical diagnoses, diseases, and health conditions. They provide detailed information about a patient’s diagnosis. Unlike CPT codes, which describe the medical services or procedures performed, ICD-10 codes specify the reason for those services by indicating the patient’s diagnosis.
Downcoding: Downcoding occurs when an insurance company reviews a claim and determines that the level of service billed is higher than what was documented. As a result, the insurer reduces the billed code to a lower-paying one, which can decrease reimbursement or lead to a denied claim. This often happens if the documentation does not support the higher-level service that was originally submitted.
Electronic Data Interchange (EDI): in medical billing this refers to the electronic transfer of healthcare data, such as claims, eligibility requests, remittance advice, and authorizations, between healthcare providers and insurance payers in a standardized format. EDI streamlines communication, reduces paperwork, and speeds up claim processing.
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Common EDI transaction types include:
- 837: Claim submission
- 270/271: Eligibility inquiry and response
- 835: Electronic Remittance Advice (ERA)
Electronic Remittance Advice (ERA): a digital version of a paper Explanation of Benefits (EOB) that provides detailed information about how a medical claim was processed by a payer, including payments, adjustments, and denials. It corresponds to the standard HIPAA transaction code 835, so it's often referred to as the 835 ERA.
Explanation of Benefits (EOB): a statement sent by a health insurance company to a patient after a claim has been processed. It explains what services were billed, how much was covered by insurance, what the insurance paid, and what the patient may still owe.
- This is not a bill; it’s used for information purposes.
- It helps patients and providers understand how their benefits were applied to a claim.
Fee Schedule: A fee schedule is a comprehensive list of the charges a healthcare provider sets for each service, procedure, or treatment offered. It outlines the standard fees billed to patients or insurance companies and may vary based on factors such as service complexity or time spent.
Financial Responsibility: The agreement, typically outlined in the contract between the client and their healthcare provider, defines who is responsible for payment before, during, and after medical services are provided. It sets clear expectations regarding patient payments, insurance coverage, co-pays, deductibles, and any remaining balances.
Good Faith Estimate: A detailed, written estimate provided by healthcare providers or facilities that outlines the expected costs for medical services or treatments before they are performed. It helps patients understand and prepare for their potential out-of-pocket expenses, especially if they do not have insurance or are receiving out-of-network care. This estimate is required by law to promote transparency and protect patients from surprise medical bills.
HCPCS (Healthcare Common Procedure Coding System): includes CPT codes (as Level I) and additional codes (Level II) for services not covered by CPT, such as ambulance services, durable medical equipment (DME), and certain medications.
In-Network: This term refers to healthcare providers or facilities that have a contract or agreement with an insurance company to offer services to the insurer’s members at negotiated rates. When a provider is in-network, patients typically pay lower out-of-pocket costs compared to out-of-network providers.
Knowledge Base (KB articles): informational documents designed to help users understand, use, or troubleshoot a product, service, or process. They provide clear, step-by-step instructions, explanations, or answers to common questions. Many of our KB articles also include links to demo videos to demonstrate the steps detailed within the article.
- These are in OptiMantra under Shortcuts > Knowledge Base.
Maximum Out-of-Pocket: The maximum amount of money a client is required to pay out of their own pocket for covered healthcare services in a given year. Once this limit is reached, the insurance plan typically covers 100% of eligible expenses for the remainder of the year. This amount includes deductibles, co-pays, and co-insurance but usually does not include premiums.
Medicare: Medicare is a federal health insurance program primarily designed for people aged 65 and older, as well as certain younger individuals with disabilities or specific medical conditions. It helps cover hospital care, medical services, and prescription drugs through different parts of the program, such as Part A (hospital insurance), Part B (medical insurance), and Part D (prescription drug coverage). Medicare aims to provide affordable healthcare coverage to eligible beneficiaries.
Medicaid: Medicaid is a joint federal and state government program that provides health insurance coverage to individuals and families with low income or limited resources. It offers a broad range of medical services, including doctor visits, hospital care, long-term care, and preventive services. Eligibility criteria and benefits can vary by state, but the program aims to ensure access to essential healthcare for those who might otherwise be uninsured.
NDC Code (National Drug Code): a unique 10- or 11-digit number assigned to medications in the United States that identifies the drug’s manufacturer, product, and packaging. In medical billing, NDC codes are used to report and bill for prescription drugs and certain medical products.
Not Otherwise Specified (NOS): In medical billing and coding, this term is used when a diagnosis lacks detailed information or specificity in the medical record. It allows coders to assign an ICD-10 code when the exact condition or subtype is not documented by the provider. NOS codes are often considered less precise and may affect claim processing or reimbursement.
National Provider Identifier (NPI) Number: A unique 10-digit identification number assigned to healthcare providers in the US by the Centers for Medicare & Medicaid Services (CMS). It is used in all administrative and financial transactions under HIPAA, such as billing, claims, and referrals. All covered healthcare providers must have an NPI to be recognized by insurance companies and federal health programs.
Out-of-Network: A term used by insurance companies to describe healthcare providers or facilities that do not have a contract with a particular insurance plan. Because they are not in-network, services from out-of-network providers typically result in higher out-of-pocket costs for the patient, and in some cases, may not be covered at all depending on the insurance plan.
Place of Service (POS): a two-digit code used on medical claims to indicate the location where healthcare services were provided, such as a physician’s office, outpatient facility, or patient’s home. The POS code helps payers determine appropriate reimbursement rates and coverage policies based on the setting of care.
Pre-Certification: Also known as prior authorization or prior approval, is the process by which a healthcare provider or patient must obtain approval from the insurance company before a specific treatment, service, or procedure is performed. This step confirms that the service is medically necessary and covered under the patient’s plan. Without pre-certification, the insurance company may deny payment.
Primary Payer: The insurance plan or program that pays first on a healthcare claim when a patient has multiple sources of coverage. The primary payer is responsible for processing the claim and covering costs up to its plan limits before any other insurer contributes.
Rendering Physician/Provider: The healthcare provider who directly performs the medical service or procedure for the patient. In medical billing, the rendering physician is identified on the claim as the individual responsible for delivering the care, even if the billing is submitted by a group or facility. Their name and National Provider Identifier (NPI) must be included for accurate claims processing and reimbursement. In some cases, the attending and rendering physician can be the same person, but not always.
Revenue Code (Rev Code): a three- or four-digit code used in institutional billing (e.g., hospitals, skilled nursing facilities) to categorize services, supplies, and accommodations provided to a patient. These codes help insurance companies identify the type of service rendered and the department where it was provided. For instance, Rev Code 0111 represents general medical/surgical services.
Secondary Payer: The insurance plan or program that pays after the primary payer has processed a healthcare claim. The secondary payer may cover some or all the remaining costs not paid by the primary payer, depending on the benefits and coordination rules.
Self-pay: A term used to describe clients who pay out-of-pocket for services, rather than using health insurance or other third-party payers.
Service Units: the numerical quantity that represents the amount of a healthcare service or procedure provided to a patient. Service units are used on medical claims to indicate how many times a service was performed or the duration/quantity of that service.
Superbills: The patient’s receipt after a visit or purchase. These Superbills should be created for each patient after every visit and/or after the EOB is processed in clinics that bill insurance. Click Here for More on Superbills
Supervising Physician: licensed healthcare provider who oversees and is legally responsible for the medical services provided by another clinician, such as a nurse practitioner, physician assistant, or trainee. In medical billing, the supervising physician may be required to be listed on claims when services are performed under their supervision, depending on payer and regulatory guidelines.
Upcoding: The fraudulent practice of billing using a more severe or higher-paying ICD-10 code than is medically necessary or accurate, to receive increased reimbursement from a client or insurance provider.
Write-off: The portion of a provider's fee that exceeds the amount approved by the insurance company and is not billed to the client. This amount is adjusted off the account and is not the client’s responsibility.