How does electronic billing work for medical claims?

How does electronic billing work for medical claims?


Electronic claims work by a practice management software generating a claim, sending it to a clearinghouse for processing, and then the clearinghouse transmits the claim to the insurance company. This process streamlines the claim submission, potentially reducing errors and speeding up the payment process. 

A clearinghouse is like an electronic post office. You'll send all your claims to them in ONE file. They'll sort them out and send them to the right place and in the right format. Then they'll gather all the status reports from the insurance companies and post them for you to review 24/7. Everything in one spot. One portal, one login. They charge a fee, but can save you a lot of time and frustration compared to you trying to send your claims individually.

Here's a more detailed breakdown:

1. Practice Management Software:

The process begins with the practice's management software, which creates claims with patient, insurance, and procedure details. With Speedy Claims, all claims are saved to the claim list. From there, claims are selected, and an electronic batch file can be created. The file output can be in either Print Image or ANSI 837 format.

2. Claim Transmission:

The claim is then transmitted to your clearinghouse. 

3. Clearinghouse Processing:

The clearinghouse performs several functions:

    1. Claim Scrubbing: This process reviews the claim for errors or missing information, such as invalid codes, missing patient data, or incorrect formatting. 
    1. Standardization: It converts the claim into a standardized format, often ANSI X12 or 837 
    1. Error Correction: If errors are found, the clearinghouse notifies the provider, so the claim can be corrected.

4. Claim Submission to Insurance:

Once the claim is scrubbed and corrected, the clearinghouse transmits it to the appropriate insurance company or payer. 

5. Payment and Adjudication:

The insurance company processes the claim, determines the amount due, and initiates payment to the provider.

 For more details on the benefits of electronic billing, as well as clearinghouse recommendations, please visit