Behavioral health billing, like medical billing, can be a complex process. However, it is a highly profitable one as well. This is because a huge part of medical expenses is related to behavioral health conditions.
Data shows that while only 2% of the total commercial healthcare expenditure is related to mental health problems, 40% of it, or $752 billion, is tied to behavioral health conditions.
For behavioral health providers looking to stay ahead of the game in any way possible, this guide will provide you with everything you need to know about this complicated but lucrative process.
What Is Behavioral Health Billing?
Behavioral health billing is collecting money from insurance companies for patient services. In other words, submitting claims and receiving payment for your assistance.
Behavioral health billing involves the financial transactions and reimbursement procedures between behavioral health providers, such as psychiatrists, psychologists, therapists, treatment facilities, and insurance companies or government payers.
How Does Behavioral Health Billing Work?
Behavioral health billing is a service that helps mental healthcare service providers to get their payments from insurance companies. This can be a complex process, as providers must handle all the documentation and communicate with the insurance providers to get the amount. According to Millin, although very essential, behavioral service programs can often lead to the burden of medical billing, finance, and compliance teams.
However, there are software applications that can make the process easier by automating several tasks. For instance, it can automate claim submission, help track applications, etc.
Here’s a general overview of how behavioral health billing works:
- Service Provision: A behavioral health provider delivers services to a patient, including assessments, therapy sessions, medication management, or other treatments related to mental health or substance abuse.
- Patient Information: The provider gathers relevant patient information, including demographics, insurance details, and clinical documentation. This information is necessary for accurate billing.
- Coding: The provider assigns appropriate medical codes to the services provided. The most commonly used coding system in the United States is the Current Procedural Terminology (CPT) code, which describes the specific services rendered during the patient visit.
- Claim Submission: The provider compiles the necessary information, including patient details, services provided, and associated codes, and submits a claim to the patient’s insurance company or payer. This claim is typically sent electronically through billing software or a clearinghouse.
- Adjudication: The insurance company or payer reviews the claim to determine its eligibility for reimbursement. They assess factors such as the patient’s coverage, the provider’s credentials, the medical necessity of the services, and adherence to billing guidelines and policies.
- Reimbursement: If the claim is approved, the insurance company or payer reimburses the provider for the services rendered. The reimbursement amount can vary depending on factors such as the patient’s insurance plan, deductible, copay, and pre-authorization requirements.
- Patient Responsibility: After reimbursement, the patient may pay any outstanding balance, such as copayments, deductibles, or coinsurance, per their insurance plan.
Essential Components of Behavioral Health Billing
To be successful in behavioral health billing, it’s important to understand the essential components of this process. The following are some of the critical elements that you will need to be familiar with:
Patient Registration and Verification of Insurance Coverage
As you know, patient registration is the first step in the billing process. It’s also important to note that insurance coverage verification is essential for accurate and efficient payments.
A receptionist or administrative assistant can do the verification. This person will take down information from your patient about their current plans, benefits, and any changes in those plans over time. The information provided by your patient must match what’s on file with each payer before your office administrator or billing company can process payment.
Documentation and Coding Guidelines for Accurate Billing
Documentation and coding guidelines are essential components of behavioral health billing. Comprehensive documentation provides a detailed picture of how your patients are doing, which allows you to make more informed decisions about their care.
Your documentation should also be consistent across all patients so that it is easy for anyone reviewing the records, including yourself, to understand what has happened with each patient over time and why specific treatments were chosen over others. Consistency helps ensure accuracy in billing as well. If one provider writes “paranoid” while another writes “delusional,” how will anyone know which diagnosis was meant?
In addition to accuracy, legible handwriting improves readability and makes it easier for providers and payers. Timely entries help ensure better outcomes because they allow everyone involved in treatment planning.
The documentation should also involve the treatment costs. In general, the average consultancy fee without insurance costs between $100 and $300. You need to add all the details, whether your claim is within this range or higher. This can include price per hour, charges for any additional treatment, etc.
Utilization of Standardized Assessment Tools for Billing Purposes
Standardized assessment tools are an essential component of behavioral health billing. In fact, it’s one of the most important components of behavioral health billing and can be used to determine whether or not a patient qualifies for benefits under their plan.
Insurance providers use standardized assessments as part of their process for approving claims and determining if patients are eligible for services. They are designed to help identify symptoms related to mental illnesses or substance abuse disorders, which may include anxiety disorders and depression.
Insurance companies often require a certain number of specific questions from each standardized assessment tool before approving any claim associated with those conditions. For instance, the initial evaluation of a patient with a possible eating disorder includes height-weight history, restrictive eating, purging behaviors, and a family history of eating disorders. But that is not all. There are more guidelines that an insurance provider has to look into.
Properly Documenting and Billing for Co-Occurring Disorders
Co-occurring disorders are a significant concern for behavioral health providers. The most effective treatment plans will address the primary diagnosis and its accompanying co-occurring disorders. The challenge, however, is that reimbursement for these conditions can be complicated to navigate.
The documentation and coding guidelines provided by CMS (the Centers for Medicare & Medicaid Services) are essential for adequately billing co-occurring disorders. Behavioral health providers must be able to code accurately to ensure their patients receive adequate coverage through insurance companies or government programs such as Medicaid or Medicare Part B.
Handling Crisis Intervention and Emergency Services Billing
Crisis intervention and emergency services are not covered by insurance. If a patient needs to be admitted to the hospital due to a mental illness, this can be costly because it is classified as out-of-network care.
The good news is that there are ways to handle patient billing for these services if needed. You’ll need to work with your patients ahead of time so that they know what will happen if they need an emergency room visit or hospitalization during their stay with you.
Compliance and Auditing Considerations
Here are some compliance and auditing considerations you should understand.
- Billing compliance. The first step in maintaining proper documentation is to ensure you’re billing for the appropriate services. In addition to ensuring you’re charging for a service that’s provided and documenting it accordingly, it’s essential to ensure that all required elements are included on the claim form. If a patient requires two visits with their therapist and only one visit is recorded in their chart, for example, this could raise red flags during an audit and result in your claims being rejected or denied altogether.
- Auditing considerations. It’s essential not only that you maintain proper documentation but also that others do. This means ensuring they keep accurate records of their work activities to back up any statements made about services provided by them or other providers.
- Importance of maintaining proper documentation. Maintaining correct records helps ensure accurate billing and reduces confusion when entering data into electronic health records systems.
Conclusion
We hope this article has helped you better understand the behavioral health billing process and how it works. As with any business, many factors must be considered when managing your revenue stream. Providers must stay up-to-date on current trends in healthcare and continue educating themselves about new regulations or changes within their industry to be prepared when they arise.
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