What is Medical Billing Software?

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  • Written By: Mary McMahon
  • Edited By: O. Wallace
  • Last Modified Date: 11 November 2019
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Medical billing software is computer software which is designed to facilitate the medical billing process. Medical billing can be extremely complex, especially when a medical facility is handling billing to multiple insurance companies along with government agencies and private consumers, and all of these groups may require different billing procedures. In addition to being used to generate bills, the software is also used to track payments and it can be used to track overall patient and facility trends, which can be of interest from a number of perspectives.

Companies which make medical billing software generally design it to work with a standardized framework, such as the International Statistical Classification of Diseases and Related Health Problems (ICD). This framework is used to create a series of codes which can be entered into the software to describe conditions, treatments, and so forth. The care provider may be required to know the codes for various procedures and treatments, or the codes may be built right into the paperwork used by the facility, for the convenience of the people who work in the billing department.


Once a patient record is started in a medical billing software program, the patient's history can be entered in, along with outstanding unpaid charges. The program can be told to generate bills for the patient, or for insurance companies, employers, and other individuals who may be paying the patient's bills. Since insurance companies often have different codes which are regularly changed, the medical billing software will need to be periodically updated to get the latest information, with the software converting from the standardized codes used in the office to the codes used by insurance companies for billing.

Essentially, medical billing software is a highly specialized form of accounting software. Like other accounting software, it maintains records on customers, their payment history, and any special arrangements they may have worked out. It is also designed to be secure and confidential, due to concerns about patient records, and medical billers are often given special training in patient confidentiality and other concerns to ensure that the information they handle is used responsibly.

Medical billing software suites can be extremely expensive, especially once regular updates are factored in, but many medical facilities find such software to be critical to their operations. Without specialized software, billers would need to handle patient records by hand, and they would have to keep up with the various billing codes used by the different companies and agencies they work with. Maintaining electronic billing records makes billing more efficient and less prone to errors.


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