What Is a Medical Claim and Its Importance?

A medical claim is a piece of document or a bill that healthcare providers submit to the insurance provider of a patient. This medical claim contains comprehensive data regarding the care and services provided to the patient in the form of unique medical codes. Such a medical claim generated by medical billing professionals serves as one of the most valuable and reliable sources of data for healthcare organizations. A medical claim describes every kind of service that a provider renders in the process of providing quality healthcare. All these services described through unique medical codes include diagnoses, procedures, medical supplies, medical devices, pharmaceuticals and medical transportation. Once the medical claim is submitted, the insurance provider assesses the medical codes mentioned in the claim and determines whether the services mentioned in the claim have to be reimbursed or denied.

People in medical coding jobs must know the elements of a medical claim and prepare medical claims accurately because the accuracy of these claims brings the healthcare providers full reimbursements helping them to maintain a healthy revenue cycle. There are two parts to a medical claim – the claim header and the claim detail. If you are working for a healthcare provider or a medical billing company, you must be aware of these parts and what information goes into which part.

Claim Header:

A claim header gives the most critical information in the claim including confidential and personally identifiable information such as:

  • Date of birth
  • Gender
  • Zip code
  • National provider identifier (NPI) of the physician or healthcare facility
  • Primary diagnosis code
  • Inpatient procedure, if any
  • Diagnosis-related group
  • Insurance company’s name
  • The overall charge for the claim

Claim Detail:

This includes all the information related to the secondary diagnoses and procedures performed during a patient’s inpatient hospital stay including:

  • Date of service (DOS)
  • Procedure code
  • Diagnoses code
  • National drug code, if any
  • Attending physician’s NPI number
  • Charge for the service

Once a medical claim is prepared by the revue cycle management (RCM) team, it is sent to a clearinghouse which is an electronic intermediary between the healthcare providers and insurance companies. At the clearinghouse, the claims are scrubbed, standardized and screened before sending them to the payers to mitigate and rectify any medical coding and formatting errors in the claims that can delay the reimbursements from the payers. Clearinghouses are not just beneficial for the healthcare providers but also for the payers. The clearinghouses format the data received from various healthcare providers according to the unique requirements of the insurance companies thereby standardizing their data and speeding up their processes.

If you are a medical biller or a part of an RCM services company, you must ensure that you process clean claims for your client so that the healthcare provider gets full reimbursement for the services rendered without any claim denials or rejections that reduce your revenues and hamper your revenue cycle management process. Further, the medical claims prepared by you can be of great use for the healthcare providers to trace referral patterns, increase sales and accelerate the marketing strategies that help them improve their revenue cycles.

What Is a Medical Claim and Its Importance?