Clearing house and it’s role in Healthcare EDI Communication
Clearing house is a third party service provider. It takes non-EDI data and translates them to EDI data. Clearing house can also translate EDI to EDI. This is done by taking the received raw data, massaging and scrubbing it. Then data are sent to another document. Clearinghouse can also convert paper documents to EDI and vice versa.
Health plans may decide to accept only electronic transactions. This is done to increase efficiencies and reduce cost and errors. Many providers want to maintain the business relationship. That is why they must be prepared to implement billing software. Another solution is to use a clearing house.
Most Clearing houses provide the following services:
- Bundling & Unbundling
- Re-pricing of claims
- Code-specific conversions
- Provider network scrubbing
- Eligibility Validation
- Paper-to-EDI / OCR
- Custom EDI conversion / mapping.
Clearing houses Benefits:
- Faster reimbursement
- Reduction in rejected claims (Clean Claims)
- Decrease in time-intensive manual tasks
- Increase in productivity
- Improvement in cash flow.
Clearing houses in medical billing are known as third-parties. They forward claims from healthcare provider to insurance payer. Claims scrubbing is what clearing houses usually do. The company checks the claim for errors and verifies it.
Then the claim is compatible with the software that the payer has.
Also clearing house checks if procedure and diagnosis codes are valid. Each procedure code should correspond the submitted diagnosis code. Claim scrubbing prevent further errors and therefore saves time. Healthcare provider can personaly choose a clearing house. Clearing house institutions charge fees for claims check. Extra fee can be added for sending a claim to the payer. Sometimes there can be two clearing houses involved. The reasons are the following:
- provider and payer use different clearing houses
- software of the parties differ and claims can not be processed.