By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    Medical device classification and development strategies
    Medical device classification and development strategies
    April 5, 2023
    varicose veins
    Varicose Veins Prevention: 3 Lifestyle Changes to Make Right Now
    May 1, 2022
    Things You Should Know Before Buying Golden Teacher Mushrooms Spores
    Things You Should Know Before Buying Golden Teacher Mushrooms Spores
    September 15, 2022
    Latest News
    Beyond Nutrition: Everyday Foods That Support Whole-Body Health
    June 15, 2025
    The Wide-Ranging Benefits of Magnesium Supplements
    June 11, 2025
    The Best Home Remedies for Migraines
    June 5, 2025
    The Hidden Impact Of Stress On Your Body’s Alignment And Balance
    May 22, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    Aaron Carroll Defends Retail Clinics
    December 13, 2011
    Health Wonk Review – Opening Day Edition
    September 11, 2017
    Cigarette Warning Labels May Go Up in Smoke
    January 9, 2012
    Latest News
    Let Your Lawyer Handle the Work Before You Pay Medical Costs
    July 6, 2025
    Top HIPAA-Compliant Messaging Apps for Healthcare Teams
    June 25, 2025
    When Healthcare Ends, the Legal Process Begins: What Families Should Know About Probate and Medical Estates
    June 20, 2025
    Preventing Contamination In Healthcare Facilities Starts With Hygiene
    June 15, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Medical Claims Adjudication: What You Need To Know About It
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Medical Claims Adjudication: What You Need To Know About It
Policy & Law

Medical Claims Adjudication: What You Need To Know About It

Rehan Ijaz
Rehan Ijaz
Share
7 Min Read
SHARE

The process of paying or denying claims submitted after comparing them to the coverage or benefit requirements in the insurance industry is known as claims adjudication. The medical claims adjudication process involves a series of steps: an insured person submitting the claim, the insurance company receiving it, and then manually processing the claim or using software to make a decision.

The claim process will be referred to as auto-adjudication if it’s automatically done using software from automation service providers like Smart Data Solutions. Some claims are still submitted on paper and manually processed by insurance workers, though. However, there’s no denying that automating claims not only improves efficiency but also reduces expenses, usually required for manual adjudication.

Do you ever wonder what exactly happens to your medical insurance claim once it finally leaves the office of your doctor? You’ll learn everything you need to know about it here.

Submitting a Claim

More Read

Better Late Than Never: China Adopts Its First Mental Health Law
The Risks Of Ignoring Chronic Pain Can Lead To Serious Diseases
Dying in the 21st Century
Economic Stress Linked to Poor Brain Development in Children
There’s No Business Like the Healthcare Business

The claim is submitted to the insurance company typically by your provider or doctor. It holds especially if they’re part of your plan. However, when you visit a physician outside your plan,  you may have to submit it yourself. If you ever find yourself in this rare situation, below are some steps you can take to make sure that your claim actually gets processed smoothly.

  • Check to see if you’re using the claim form specifically from your benefits plan
  • Don’t miss essential information, especially the procedure codes, which you can obtain from the office of your doctor
  • Make sure to write legibly if you’re going to fill the form out by hand
  • Be prompt in filing the paperwork, making sure it doesn’t go beyond the time limit
  • If needed, make sure to include pre-approval
  • Verify your plan covers the treatment claim

Receiving The Claim

Once the claim reaches the insurance company, it will undergo a thorough review. The process can be divided into two phases: patient information review and validation of physician and NPI or National Provider Identifier designation. Learn more about them below.

  • Review of Patient Information – Your claim will be placed in a “lineup” and finally starts through the process of medical claim adjudication. The software begins to review patient information, especially if the form is received electronically (which happens in most cases) by the insurance company.

A unique identification number gets assigned to the patient. It’s the first piece of information the software verifies, allowing the edits to recognize the different information associated with the patient’s assigned insurance plan.

If the name of the patient doesn’t match with the ID number, the medical claim adjudication may end prematurely at this step. These details must be associated with each other. If not, the physician will receive a rejection letter, either through electronic means or mail, explaining the reasons for the denial. The patient will also get a copy of the rejection letter.

Other information that the software edits will verify are the gender of the patient and date of birth. In each step, if a specific piece of information isn’t attached to the patient’s ID number, it may trigger rejection or stop notification.

The diagnosis code and the medical information represented by procedural codes are also vital pieces of claim information. The software will match the procedure with the medical reason or diagnosis code for the service provided.

The software then confirms whether or not the procedure actually is included in the patient’s insurance plan. The software can either deny the claim or send it for medical review at this point.

  • Physician and National Provider Identifier (NPI) Validation – The software will continue to review the claim and validate the NPI designation and physician’s name. This is an essential step in determining the reimbursement amount. The edits in the software will verify whether the physician is out of network or has an existing contract with the insurance company.

The software will also review the co-pay and any other payments of the patient to determine if the portion of the payment the patient has to make has actually been made. The software also checks if the patient’s payments have been subtracted from the billed amount correctly.

Medical Review

As already mentioned, the software can send the claim to undergo medical review. A medical review desk will receive the claim electronically and will conduct the medical review process. An authorized nurse will review the claim’s information. The patient’s prior claims and health insurance policy will be checked to determine the appropriate procedure and medical necessity.

Once the medical review desk receives the claim, and the information is being reviewed, the claim will remain in development and suspension.

The nurse may involve doctors from the insurance staff when reviewing all documentation. Once the review is completed, the authorized nurse or doctor may approve or deny the claim based on criteria set by the insurance company and the medical staff.

Final Step

When a claim is approved, the patient will receive an EOB or Explanation of Benefits detailing how the medical care he received is being paid by the insurance plan.

Your doctor may also send a final bill for services to you around the same time. It’s best to compare the EOB with the final bill for rendered services. Make sure the details match before paying your doctor.

TAGGED:featuredmedical claimsmedical claims adjudication
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

9 Lifestyle Tweaks That Can Add Years to Your Life
9 Healthcare Lifestyle Tweaks That can Add Years to Your Life
lifestyle
July 11, 2025
car accident lawsuit
Let Your Lawyer Handle the Work Before You Pay Medical Costs
Policy & Law
July 6, 2025
women dental care
What Is a Smile Makeover and How Much Does It Cost?
Dental health
June 30, 2025
HIPAA-Compliant Messaging Apps
Top HIPAA-Compliant Messaging Apps for Healthcare Teams
Global Healthcare Policy & Law Technology
June 25, 2025

You Might also Like

Addressing Chronic Diseases Would Reduce Debt, Generate Savings

September 21, 2011
medical malpractice fear order more tests
BusinessMedical Ethics

Medical Malpractice Fear Drives Doctors to Order Too Many Tests MD Survey Shows

February 12, 2012

Health Care Inflation

May 17, 2011
icd-10 billing
BusinesseHealthFinanceHealth ReformHospital AdministrationMedical Records

Why Ignoring ICD-10 Won’t Make It Go Away

May 17, 2013
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?