Payment posting in medical billing refers to the process of recording and applying payments received from patients, insurance companies, or other third-party payers to patient accounts. It is a crucial step in the revenue cycle management of healthcare providers.
When a healthcare provider renders services to a patient, they generate a claim or invoice for the services provided. Afterward, the payer, whether it’s an insurance company or the patient themselves, submits payment for the services.
Payment posting involves the following key steps:
- Receiving payment: The provider receives payments in various forms, including checks, electronic funds transfers (EFT), credit card payments, or electronic remittance advice (ERA) from insurance companies.
- Identification and verification: The payments received need to be identified and verified to ensure accuracy. This involves matching the payment information, such as patient name, account number, and payment amount, with the corresponding patient’s account and services rendered.
- Allocation of payment: Once the payment is identified and verified, it needs to be allocated appropriately. This involves applying the payment to the specific charges or outstanding balances on the patient’s account. Payments can be applied to individual services, multiple services, or outstanding balances from previous visits.
- Adjustment calculation: In some cases, payment posting also involves calculating adjustments or write-offs. Adjustments may include contractual adjustments based on negotiated rates with insurance companies or adjustments for discounts, write-offs, or adjustments for charity care or financial assistance programs.
- Denial handling: If the payment received is less than the expected amount or if the claim is denied, payment posting includes handling these denials. This may involve investigating the reason for the denial, correcting any errors, resubmitting the claim, or appealing the denial if necessary.
- Reporting and reconciliation: Finally, payment posting involves generating reports and reconciling the posted payments with the provider’s financial records. This step ensures that all payments have been accurately recorded and accounted for.
Accurate and timely payment posting is essential for healthcare providers to maintain their financial health, track revenue, and manage patient accounts effectively. It helps ensure that payments are properly applied, denials are addressed, and the provider receives the appropriate reimbursement for the services rendered