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Choosing the Right Clearinghouse - Five Essential Qualities


An article by Bill Marvin from the July/August issue of HBMA Billing (

In the healthcare billing industry, the clearinghouse you work with has a huge impact on your business. The more efficiently your clearinghouse processes and returns your information, the faster you and your clients will get paid and the more payments you will collect. Therefore, knowing the right qualities to look for in a clearinghouse is crucial to the success of your business.

To gain insight into what billing services need from a clearinghouse, I interviewed Kevin Milam, owner of a company that does billing, consulting, and accrediting for clients across several states. We came up with five essential qualities to look for when researching clearinghouses to ensure that you are making the best decision for your business and your clients.

1. Knowledgeable and Immediate Customer Support

Having access to a knowledgeable, responsive customer service team is critical in any industry. For a billing service, waiting multiple days for an issue to be resolved can result in delayed payment, so choose a clearinghouse that allows you to log an inquiry 24/7 and that will respond to you within 24 hours. How can you tell for sure if a clearinghouse offers high-quality customer support? "Generally, if you receive immediate acknowledgement and responses to inquiries while you're researching a clearinghouse, you likely will receive the same treatment as a customer," says Kevin. Also, review the clearinghouse's commitment to customer service hours and responses in its contract. In most contracts, these performance elements are known as Service Level Agreements (SLAs) and are contractual commitments, sometimes with penalties.

2. Quick Claim Responses (Claim Status)

Once you submit claims to your clearinghouse, you should know within minutes which claims went through and which claims need to be corrected and resubmitted. "The longer you have to wait for claim responses, the longer it takes before you can correct any errors," says Kevin. "This delays cash flow for you and your clients and potentially leaves money on the table." Clearinghouses that tie claim status back to individual claims will save you time in the submission process.

3. Consistency and Accountability with 835s

You should receive an 835 and payment within a consistent timeframe so that you can post and reconcile your payments quickly. "With clearinghouses I've used in the past, I have received 835s weeks or even months after receiving the payments," says Kevin. "There was no consistency." When you can count on receiving 835s and payments within a day or two of each other, you and your staff won't waste time tracking down delayed 835s or payments for posting and reconciliation. Furthermore, the payment trace numbers or check numbers should re-associate with the 835s so that you can reconcile the payments more efficiently.

4. Efficient Claim Information

"It's not enough to have all of the claim information in your system," says Kevin. "You need to be able to use that information efficiently across multiple staff members at the same time." For example, if you can view a summary of all claim statuses on an 835, your staff can immediately identify which payments to post and which claims to reprocess. Additionally, your staff should have the ability to update the claim statuses as they reprocess claims or post payments, so that they don't duplicate any work done on the 835. This enables you to track all claim activity from a summary report or dashboard without wasting time looking at each individual claim.

5. Usability

For a billing service, it's key to be able to train your staff to use your system, especially as your staff changes or expands. Choose a clearinghouse with easy-to-use features like human readable claim responses and 835s; detailed and customizable reports hosted in a secure, private cloud; and a minimal number of clicks required to complete your workflow. "The steps required to process claims should make sense," says Kevin. "If you can't easily train your staff to use your system, it won't benefit you."

In addition, it is important to choose a clearinghouse that is accredited by the Electronic HealthCare Network Accreditation Commission (EHNAC). Some states and many payers will require you to use an EHNAC-accredited clearinghouse.

When you research clearinghouses, be sure to speak with existing customers, whom you can ask about each of these qualities. As the industry pushes for greater efficiency, it becomes even more important for your business to save time and money. Working with a clearinghouse that has all five of these qualities will help you to simplify your day-to-day processes, increase your cash flow, and help your business and your clients' businesses thrive.

Bill Marvin has been in the revenue cycle industry since 1993 and is the co-founder and CEO of InstaMed, the leading Healthcare Payments Network. Prior to InstaMed, Bill was an executive in Accenture's Health and Life Sciences practice, focused on payer to provider connectivity. Prior to Accenture, Bill founded CareWide (now a part of AllScripts after three acquisitions), a practice management system for provider offices.

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