What is Facility Billing – A Guide

Touseef Riaz

September 29, 2022

what is facility billing

The term “facility billing” refers to charging a patient’s insurance provider for services rendered in a hospital, clinic, or other health care facility. Moreover, facility billing can benefit the patient and the organization providing care. So, before heading to know its importance and role, it is important to figure out What is facility billing? So, here is a complete guide. 

what is facility billing

What Is Facility Billing?

Facility billing is the process through which a health care provider bills a patient’s health insurance for services provided by an outpatient department at a hospital or clinic. The patient does not need to be admitted to the hospital or clinic for this service. This can include lab tests and x-rays, surgeries, physical therapy and rehabilitation therapy, and imaging studies. For instance, it includes MRIs and CT scans, medications administered during treatment sessions, and costs associated with transportation from home to the facility where these services were rendered.

In addition to this, it is a record of patients’ services in an outpatient setting. These bills will be sent to the patient and their insurance company for reimbursement purposes. This is an overall system throughout the healthcare industry that requires hospital staff to have a thorough understanding of how everything works. Therefore, you should not only find out what facility billing is but also learn about its pros and cons before being equipped with the knowledge you need to handle these tasks efficiently.

The process of facility billing:

It is a process of recording, documenting, and paying for a patient’s service or product(s). It also involves keeping records of patients seen in medical facilities.

Facility bills are sent to insurance companies or other payers. Moreover, the facility bills should show the dates on which services were performed, the services provided, and the charges for those services. If a patient was seen more than once during a given period, each new visit should be billed separately.

The facility may bill for each service rendered or for all services performed during a specific date/time. However, it is not always accurate since some providers do not know how often they see a particular patient, so they may not always record each visit accurately on the facility bill.

In addition to this, these bills also involve taking care of various other aspects, such as ensuring that the hospital or clinic has a proper system of records, which includes keeping track of all the data related to patients’ records and what services were provided to them.

The facility billing process may include:

  • Recording a patient’s name, address, insurance information, and any other items necessary to create an invoice for payment.
  • Allowing the patient to review their invoice before signing it.
  • Sending an invoice to the patient’s insurance company for payment.
  • Receiving payment from the insurance company for services rendered.

Different types of medical facility billing services:

If you want to know about What is facility billing, First learn about its type and how they are helpful for patients. So, in the medical facility billing industry, many services can be rendered. Each of these services has its billing code. Here are some examples of what comes under in  medical facility billing: 

  1. Anesthesia services: Anesthesia is a service provided by anesthesiologists or nurses who provide sedation or anesthesia for patients to make them feel comfortable during procedures. The anesthesia service includes the administration of general anesthesia, regional anesthesia, and epidural anesthesia. 
  2. Emergency room visits: The emergency room is a section within a hospital that immediately provides immediate care for patients needing treatment. It also serves as an extension of the primary care setting, giving short-stay services such as stitches and X-rays, among other things. 
  3. Laboratory testing: Laboratory testing is any procedure that involves collecting biological samples from patients, such as blood draws or urine tests. 
  4. Surgery: Surgery is any procedure involving the cutting out of body parts or removing foreign objects from inside the body. Surgery includes minor liposuction (removal of fat) and significant surgeries like hysterectomies (removal).

How do you discuss medical bills with providers?

Facility Billing is a form of accounting that provides a detailed analysis of a healthcare facility’s financial transactions and activities. A medical facility billing service provider can help you to manage your billing and collections, which are vital in keeping track of your expenses.

The medical facility billing department is responsible for calculating each patient’s visit charges and assigning those charges to an account or service. The accounts receivable department processes payments from insurance companies and other sources.

Benefits of facility billing:

So here is a quick review of What is facility billing? Moreover, its benefits are discussed in detail: 

  • It improves the quality of care delivered to patients in the hospital or health care  setting by providing a billing system that is easy to use. 
  • Ease of use for both the hospital staff and patients.
  • It makes the entire process easier for everyone involved. When a medical facility uses an automated billing system, there are fewer opportunities for human error and miscommunication, resulting in less frustration for patients and hospital staff.
  • It also helps reduce your wait time for payment. With this method, you can receive compensation in one week or less, much faster than waiting longer for a check from insurance companies or banks.
  • It enables hospitals to link with insurance companies, vendors, and other healthcare organizations.
  • It provides patients with a detailed record of their health care costs.

The role of facility billing in improving the health care system:

Medical facility billing is essential because it helps to keep the medical industry running smoothly. It also helps ensure that patients get what they need and deserve. When you take your loved one to a medical facility, you want them to be treated properly so they can get better as quickly as possible. Suppose there is any question about what facility billing is and whether or not the bill was correct. In that case, you should always ask your doctor if they need to send another account with more information or change anything on their original statement.

In short, it ensures that both patients and insurance companies receive accurate information regarding the services provided by medical facilities. Additionally, it also ensures that patients receive proper care according to their needs and preferences and those of their family members or caregivers.

Steps of facility billing:

Step I

Patients are responsible for payment of services rendered based on the facility’s price list. The facility accepts personal checks and credit cards. Charges are established by the facility based on the type of service or procedure performed, length of service and equipment used in performing the procedure, and charges for any services rendered outside your normal scope of practice or as a bonus charge.

Charges should be made at the time of service or whenever you have a reasonable opportunity. You may not bill patients for services performed without their knowledge or consent unless they have been advised that they are entitled to refuse treatment and have signed an authorization form.

Step II

The facility fee is due before the procedure is performed. The facility fee includes all costs associated with your hospital stays, such as room charges, meals, beverages, medications, supplies, and services. If you have an insurance plan that covers your hospitalization, the hospital will bill your insurance company directly for the facility fee. If you have no insurance coverage or your insurance company does not reimburse you for any portion of the facility fee. You will be billed directly by the hospital or its billing contractor.

Step III

Payment for surgical supplies and prostheses is due when the service is provided unless other arrangements have been made with our financial counselor before surgery. Surgical supplies are billed under the ICD-10 (International Classification of Diseases – 10th Revision) coding system. The code is notated as “SURGICAL SUPPLIES” and includes all items used during a surgical procedure, including those for preoperative preparation, postoperative care, and complications.

The length of stay for surgery will be billed by the number of days from the first day of surgery. The amount billed will include any extra days or services not directly related to patient care or to compensate staff members who are not paid by salary but rather by piece work or commission.

Prosthetic devices are billed according to their classification under Medicare regulations found in 42 CFR §413.20(b). The most common classification for prosthetics is F(K). Other classifications could include S(O), K(0), P(0), L(0), M(0) and A(0). So, they help a lot in telling about What is facility billing? 

Step IV

A co-pay is a fixed dollar amount you pay in advance of your service. The co-pay is due at check-in or arrival at the facility.

If you are admitted to the hospital and have not prepaid a portion of your bill, your co-pay amount will be determined by your insurance company. If you have not prepaid a part of your bill, we will assign an amount based on our estimates of your medical expenses. This can change as it is updated with actual costs.

Co-pays are due at check-in or arrival at the facility. If you cancel or reschedule your appointment, they are not refunded in total, and you may be responsible for paying them back according to the terms of your insurance policy.

Step V

If a patient has insurance, they must provide a photo ID and insurance card (s). If a patient has secondary insurance, they must also provide all information associated with their secondary insurance carrier (including name, address, phone number, date of birth, and social security number).

The billing clerk will enter this information into the system. The clerk may also use other information to identify the patient, such as their name and account number.

So, if you are looking for a reliable billing company, you should consider U Control billing. They have an experienced team that will provide you best services. 

The importance of medical billing in health care:

Medical billing is a payment practice within the United States health care system. It involves keeping track of any corrections or updates, including rejected claims and resubmitting them. Medical billing has become even more complex due to government regulations and insurance companies adopting more complex billing rules, using proprietary systems and software to process claims. It also involves keeping track of any corrections or updates, including rejected claims and resubmitting them.”

Frequently Asked Questions (FAQs)

  • What is facility billing?

Facility billing is the process of recording and paying for medical services rendered to patients. It is conducted by healthcare providers, including hospitals, physicians, clinics, and others who provide patient care. Moreover, the goal of such billing is to ensure that providers can accurately track their expenses, which are directly associated with providing quality patient care. 

  • How does facility billing work?
  • Keeping track of a patient’s name, address, insurance details, and any other details required to produce an invoice for payment.
  • Enabling the patient to examine and approve their invoice.
  • Sending an invoice for payment to the patient’s insurance provider.
  • Getting paid by the insurance provider for the services provided.

In short, there are no strict facility billing guidelines, and the  above is the process of how it works. 

  • What comes under facility billing?

In such a billing process, different types of doctors and medical professionals, including primary care physicians, specialists, and others who work at hospitals or private practice offices, are included. It is also used by many hospitals and other healthcare facilities that bill insurance companies on behalf of their patients. 

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