Going Solo? Where do claims go and how do I get paid?

When I first entered solo practice, I had no idea how I was supposed to go from seeing a patient to the point that I actually get a reimburesment check in the mail. I knew the terms, like charges and claims and submissions, and electronic filing, but that was basically it. I now have a somewhat better understanding of the process, and what I have learned I find, well, somewhat disturbing. Here's how it works.

Lets start with our hypothetical patient, Richard Cockworthy.

• Richard enters the office, fills out forms and give us his insurance card. We then get the copay. So far so good. (When I first started, I did not even know how to do this!)
• Do what I studied/trained 11 years to do; see patient.
• Fill out encounter form, the form that has the ICD9 and CPT codes.
• Give Richard his next appointment then exit him.
• Open up practice management software, and enter charges, i.e. enter into the appropriate fields the CPT codes (99213, 81003 etc) with the corresponding ICD-9 code (257.8), along with all other vital info, such as referring doctors UPIN, site code (office, hospital ,etc).
• Now it gets really interesting! I can either print the claim on a HICFA 1500 or submit it electronically using, yes its true, a 56K dial up modem (Their choice, not mine.)
• If I use a paper claim, HICFA 1500, the form is mailed directly to the payer, ie the insurance company.
• If I decide to submit electronically, I press the e-file button, and the claims go over the internet via my dial-up to a clearinghouse.
• What, pray-tell, is a clearinghouse. Well a clearinghouse is a middleman. And you guessed it, he has his hand out.
• The clearinghouses--many of them exist, such as Webmd, which is the largest--provide "services" such as adjutication of claims, what ever that means, and "cleaning" of claims (I'm not sure if I like that).
• Then the clearinghouses submit the claim on to the actual payer.
• Electronic claims, from what I've heard, get processed more quickly than paper claims, but for this priveledge, you must pay a fee. The fee varies based on volume of claims submitted and the clearinghouse.
• Paper claims do not have fees associated with them, other than stamps and printer ink, but some payers take extra-time to process these claims. Some simply never seem to recieve them the first time around and you must follow-up and re-submit the claim with the notation, 2nd attempt on the claim.
• If all necessary boxes are filled, all ICD-9's and CPT's match, all UPINs are correct, and the stars align, the check gets drafted and either mailed along with the EOB to you directly or are auto-deposited into your bank account.
• EOB means explanation of benefits, and the EOB lets you know how much you were paid per service, what you were not paid on, and sometimes why.
• Then you enter the reciepts into your software, and voila!

Complicated, convoluted, redundant, expensive, and ours. A system only a middleman could love.