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Common Medical Billing Mistakes That Affect Customer Service (and How You Can Fix Them)

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No one likes receiving medical bills, because they often contain unwelcome surprises. If your billing department receives frequent phone calls for overbilling, your practice might be guilty of one – or more – of these behaviors that lead to customer dissatisfaction and decreased billing productivity. Medical claims processing is a critical part of a practice, and claims processing software can help keep patients happy and ensure there are no delays in clearing the medical billing clearinghouse. Make your billing department run smoothly by avoiding these mistakes.

How Big a Problem Are Medical Errors?

The Department of Health and Human Services estimates that 42 percent of medical bills sent to Medicare in 2010 contained errors. These errors resulted in a staggering cost of $6.7 billion. Assuming this is representative of medical claims in general, this means a sobering number of medical claims contain errors of some kind. In fact, Pat Palmer, the founder of Medical Recovery Services in Salem, Virginia, estimates that eight out of the 10 medical bills they review contain errors.

Medical billing software makes it easier to process medical bills accurately and can make it easier to catch errors before they leave the office. However, there is always some possibility of user error in the system. As long as humans are involved in the medical billing process, there will be errors. The goal is to reduce the errors as much as possible to avoid giving patients the impression that your practice is less than professional or even intentionally attempting to overbill them.

And while you may never hear a patient complain about errors that result in underbilling, these can occur frequently as well. While this may seem less of a problem from a customer service standpoint, undercoding, or intentionally coding to avoid charging patients for all procedures, is illegal in many cases and can result in many problems for your office. Coding medical bills accurately is vitally important to improve patient customer service and avoid the problems of overcharging and underbilling.

Balance Billing

Balance billing is one of those tricky areas that can get an office in trouble for billing incorrectly and can make patients extremely irate. Balance billing is the process of billing a customer for health care costs over and above their deductible, coinsurance, or copayment and the amount the insurer is obligated to pay. When a balance remains after these payments, a problem can arise if the patient is billed for it.

In many cases, balance billing is illegal. If the patient is on Medicare or Medicaid and the provider has an agreement with these programs to accept the Medicare- or Medicaid-negotiated rate, balance billing is forbidden by the agreement and is illegal. In the same way, if a provider has a negotiated contract with an insurance provider to accept a certain payment structure, balance billing over and above that negotiated payment is illegal.

However, an office may often see patients for whom balance billing is not illegal. When a patient sees an out-of- network provider, that office may have no negotiated contract price for procedures. In this case, the amount the insurance company is obligated to pay after the patient deductible and copayments are met may be less than the amount the provider charges for the procedure. In such a case, the provider is perfectly within its rights to bill the patient for the balance.

The difficulty can arise when you have a mix of patients and balance billing is illegal for some and perfectly acceptable for others. In these cases, it becomes extremely important for the medical biller to make certain that a patient is properly billed in each case. Researching their insurance coverage and any agreements with insurance carriers is important to avoid balance billing errors.


While it is a simple matter to transpose letters or numbers or misspell names of patients or addresses, a simple typo is enough to get a claim rejected by an insurance company, often resulting in large bills being passed to the patient. The hardship created by these situations is enough to make any patient’s blood boil and should be carefully avoided.

Double check all spelling and numbers for patients’ names, addresses, and Social Security numbers, as well as all information for the insurance provider including policy number, address, and contact information. Medical billing software can help avoid these errors for provider and insurance company information, but entering new patient information should be carefully checked for any possible errors before billing.

Duplicate Billing

Duplicates are common mistakes that can haunt a medical billing department. A doctor and a nurse can both order the same treatment. In such cases, it is easy for duplicate billing to occur for a single procedure. Few errors will trigger a patient’s anger as quickly as duplicate billing. Most patients take it for granted that the mistake was intentional and will react accordingly.

While there is no easy way to explain such an error to a patient, catching duplicate errors only requires some extra care in double-checking the billing before it is sent to the patient and medical billing clearinghouse. Any entry that appears to be a duplicate should be investigated and confirmed before any bill is sent from the office.

Failing to Verify Patient Insurance Coverage

Patients’ health insurance can vary drastically from case to case. Even for a single patient, insurance coverage can change, oftentimes without the patient knowing that a change occurred. Failing to verify the patient’s insurance coverage can result in a large bill being sent to a patient who was not expecting one. Surprise medical bills are one of the least welcome events in a patient’s life and make your practice look bad, as the patient will blame you for not verifying the coverage beforehand.

Verifying patients’ insurance coverage is a key step in the billing process. Don’t skip this step. Always verify a patient’s insurance coverage before treatment to avoid having insurance claims denied and saddling patients with expensive bills.

Avoiding these common medical billing errors takes time and attention to detail, and most patients never notice when their bills are correct year after year. However, one error can lead to patient dissatisfaction and rejected claims. Take care to avoid these errors and keep your billing running smoothly.




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