2022 Medical Billing Best Practices

The medical billing industry seems to be becoming more complicated, mistake-prone, and cost inflationary for patients, hospitals and medical practices, and third-party intermediary vendors.

Due to inflation and increasing medical insurance costs, the typical American pays over $5,000 annually on their medical care. And that estimate is a 101% increase from just 34 years ago.

Even those with employer-sponsored medical insurance are paying at least $1,240 annually out-of-pocket for the privilege.

And only 62% of Americans are confident they can pay for their medical expenses.

However, the biggest financial problems for patients, the medical industry, and third-party medical billing vendors usually occur during the medical billing process. Miscommunications and medical errors lose money and increase costs and bureaucracy for everyone involved.

Some analysts believe that all medical bills are off by 10%. Others believe that over 80% of medical bills contain errors and are wrong. There is even a medical billing solutions startup that is developing an algorithm to eradicate errors.

But the easiest way for all involved to benefit from the medical billing system is to adhere to methodical medical billing practices.

So, what are some medical billing best practices to follow as models?

Trust Rainbird Healthcare to revolutionize your medical billing practices. Contact us today and learn how to increase your billing collections by 18% annually.

Related: What Exactly Is Healthcare Revenue Cycle Management


How Does The Medical Billing Process Work?

Before the concept of best practices and improved bureaucracy standards can be discussed, let’s first discuss how the medical billing process works.

“Medical billing” is a term that describes the communication, billing, and payment cycles between a patient, medical provider, and finally, the insurance company.

It should also be noted that some medical providers use third-party medical billing services instead of performing the service themself.

Medical billing processes start with a patient visiting their doctor. Afterward, the patient’s medical record is electronically updated to include the medical problem, diagnosis, and suggested treatment.

Then, the medical provider’s staff, or third-party medical billing service, evaluates the service of care and assigns a multiple-digit procedural code. These codes are used to mitigate insurance claims processes later on.

Next, the patient’s file, now titled with an alpha-numeric code number, is then electronically transmitted to the insurance company for assessment and reimbursement. The medical billing claim is now processed at this point.

This is one medical billing cycle. And it can take days or several months to complete one cycle.

However, over 50% of medical claims are rejected by insurance companies due to miscommunication and errors committed somewhere in the billing cycle before file transmission to the insurance company.

Let’s backtrack; what are the steps in the medical billing process?

What Are The Steps In The Medical Billing Process?

A medical billing process is a number of procedural steps initiated and completed by billing staff to make sure that medical providers are reimbursed for their services.

Medical billing processes vary, and there is no standardized process for filing claims. But here are eight steps most medical providers should follow.


Registering patients is the first part of the medical billing process. The patient’s vital data, reasons for the medical visit, and insurance information are collected during registration.

The patient’s medical file is created during registration and has data newly added to it with successive visits as needed.

Patient Financial Responsibility

Next, the medical provider must ascertain if the patient has medical insurance and whether their insurance can cover the medical services they need to be rendered.

The patient must be made aware that they will be responsible for paying out-of-pocket if they don’t have insurance or for any medical procedures not covered by their insurance.

Superbill Generation

The “superbill” augments the patient file that was created during registration.

Once the patient’s I.D., vital information, insurance data, and reason for the visit are added to their file, more data is added after they leave.

After the patient’s visit, medical diagnoses suggested treatments, additional data, and a medical provider-generated alpha-numeric I.D. code is added to their file.

Medical Claims Generation

The medical provider uses the superbill to create the medical billing claim that will be sent to the patient’s medical insurance company.

Medical Claims Submission

A little-known fact is that the claim is sent to a third-party company that acts as an intermediary between medical providers and insurance companies.

Monitoring Claim Adjudication

This is the step in the process where a lot of claims get rejected.

During the adjudication process, the medical insurance companies evaluate medical claims and consider if they are to be accepted or rejected until reapplication or outright denied.

Rejected claims have errors that can be corrected in a new claim. However, a denied claim means the insurance company denies the reimbursement request.

Patient’s Claim Statement

If the claim is approved, the patient is sent a billing statement for any out-of-pocket charges they may be responsible for. The statement contains an inventory of all the medical services and procedures rendered to them.

Patient Statement Follow-Up

The final step is to ensure that the medical insurers and patients, if applicable, pay for their charged costs. If the patients don’t pay their bills, their payment delinquency could be sent to a collections agency.

What Are The Biggest Challenge in Medical Billing & How To Overcome Them?

The biggest challenge in medical billing is self-induced and lackadaisical processing errors.

Here are some ideas on how medical providers can overcome basic medical billing mistakes.

  • Double check patient data during registration
  • Double check claims code assignment
  • Specify which services and procedures are not covered by the patient’s insurance
  • Double-check for medical authorizations and referrals
  • Update patient files as needed
  • Keep track of rejections and denials to brainstorm how to reverse decisions
  • Update staff training as needed
  • Upgrade quality control processes

How To Ensure Your Billing Is Accurate?

One of the best ways to ensure billing accuracy is to automate as much of the medical billing process as necessary.

Another way to maintain billing accuracy is to keep duplicate records of all claims.

How Do I Increase My Claims Submission?

Medical providers should consider outsourcing their claims processing to qualified and professional third-party providers.

It can be a herculean task for a medical provider to ably process all of the paperwork and electronic data involved with claims processing.

And hiring a third-party vendor to take care of this work leaves the medical provider time to service their patients better.


The best way to improve medical billing best practices is to develop processing methods that eradicate errors as much as possible.

Contact Rainbird Healthcare today to learn more about our A.I.-enabled claims processing algorithms.

Related: Top 10 Challenges In Medical Billing Today