Clearinghouses
A clearinghouse is simply the go-between or the middle man between a healthcare provider and an insurance company. Providers electronically submit completed claims to their clearinghouse. The clearinghouse audits each claim, checking for certain errors, then sends the claim on to the appropriate insurance company. The insurance company audits each claim then sends a claims status report back to the clearinghouse. The clearinghouse then sends that report onto the healthcare provider or biller.
The advantages of using electronic claims transfer via a clearinghouse are many compared to submitting claims by mail. To begin with, paper claim submission cost providers over $700 million per year on postage. A good, reputable clearinghouse will charge $75.00 per provider per month for unlimited claims. Paper claims submission cost the provider between $7 and $12 per claim. Electronic claims cost the provider $1.50 to $3.00 per claim.
Reimbursement for paper claims take 90 to 120 days while electronically submitted claims are paid within 7 to 21 days. Paper claims have no "proof of filing" which means medical insurance companies won't hesitate to tell providers that "they never received the claim." Electronic claims, on the other hand, are "time and date stamped" by the clearinghouse, always giving the provider and the insurance company proof of filing.
Clearinghouses are by far one of the most valuable assets to the billing process. Without them, claims simply cannot be sent electronically. Unfortunately, good, reputable, reasonably priced, "stand alone" clearinghouses are few and far between.
Stand alone?
Medical software companies almost always sell their very expensive software packages along with selling their "very own" clearinghouse services. These companies have convinced healthcare providers that their software package can only work with the software company's "personal" clearinghouse, selling the provider the software package, the clearinghouse service, tech support, the updates, and everything else they can. This locks the provider into a lengthy and costly, and, unfortunately, unnecessary relationship with the medical software company.
The truth?
- There aren't many REAL clearinghouses out there. Most who call themselves a clearinghouse are merely sending out their claims to a REAL clearinghouse. In short, most of these companies are simply the middle man to the middle man.
- Most REAL clearinghouses are able to receive claims from a variety of different software packages. In many cases, good clearinghouses will adapt their system in order to "communicate" with the provider's software.
- Reputable, reasonably priced clearinghouses charge as little as $75.00 per provider per month for unlimited claims.
- Reputable, reasonably priced software companies will never tell you that you have to use their clearinghouse services. In fact, they'll insist that you use the clearinghouse that charges as little as $75.00 per provider per month for unlimited claims.
- Whatever you do, don't sign up for "per claim" clearinghouse fees even if you think you don't send out all that many claims per month. The truth is that far too many claims need to be sent out several times before they're ever paid. Paying per claim will cost you a whole lot more in the long run.
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