Best Practices to Reduce Billing Errors in Health Insurance

One of the most famous errors in baseball history happened in 1986. The Boston Red Sox, who hadn’t won a World Series since 1918, were one out away from the title, holding a 5-3 lead in the tenth inning. The Mets staged an improbable comeback, getting three straight hits to tie the game. Mookie Wilson hit a slow roller behind first base where Bill Buckner misplayed the ball, allowing the winning run to score. The Mets went on to win the World Series the following night, extending the Red Sox futility. They wouldn’t end the streak until nearly 20 years later.


Buckner’s life changed forever. An adept hitter – he netted more than 2,700 hits in his long career – and fielder – he still holds the record for most assists in a season by an American League first baseman – most baseball fans know Buckner for his error, not his long career.

Like the famous Buckner error, errors in your billing process can impact your brand. Errors can reduce revenue, waste employees’ time as they work to fix errors, and ultimately cause customer churn.

With that in mind, here are five best practices to reduce billing errors in health insurance.

Regular Training and Thorough Documentation

Often, billing errors result from inexperienced billing representatives, poor billing processes, or failure to follow processes. Health insurers can address many of these errors with a thorough, well-defined training process and complete process documentation.

First, develop a regular training schedule. In addition to onboarding training for new employees, include a training rhythm for existing employees. That can be conducted monthly, quarterly, or annually, based on the complexity of your billing processes. Implement informal training methods, like real-world examples of how to perform complex billing tasks during weekly meetings. A culture of continuous learning can cut down on process errors.

Then, ensure you have robust and up-to-date process documentation. Implement a record-keeping system to manage and organize billing-related documents. You can include digital document management software and physical filing systems. Ensure that records are secure and accessible only to authorized personnel.

Task management software can help you manage billing processes. We use software to document processes and another solution to manage tasks. We can see when each step in the billing process was completed, by whom, and any additional notes related to each task. The software enables management to understand the status of billing tasks.

Eliminate Manual Processes

Manual processes lead to human error. Estimates show the error rate for manual processes is as high as 10 to 30%. Even a 1% error rate can significantly impact billing accuracy and customer satisfaction.

Automate as many manual processes as you can. Software can help. For example, our premium billing solution automates manual processes, like payment applications or retroactive adjustments, eliminating manual processes while saving time. 

Examine your billing process. What steps take the most time? Can you automate those processes with software? Prioritize automating processes that take the most time to improve efficiency and limit human error.

Integrate Data When Possible

Starbucks rolled out a new Mobile Order and Pay application in 2015 that integrated its loyalty program, mobile app, and in-store point-of-sale platforms to provide a seamless user experience. But it also increased revenue, with 20% of payments being of the mobile variety within two years. And it increased membership in the company’s loyalty program by 28%, leading to more promotional opportunities. Integrating mobile, loyalty, and in-store POS fueled Starbucks’ growth.

The lesson: integrating data and systems can pay huge dividends. It can also help reduce billing errors in health insurance. Ensure your billing system can ingest data from enrollment or core admin systems. Integrate it with your bank lockbox to streamline payment applications. Use single sign-on to integrate other internal systems with your billing system. Connect your billing system to your downstream general ledger for better financial reporting. The more tightly integrated these systems are, the less likely you will experience errors and rework that waste staff time. 

Automate Quality Checks

It’s common for other industries to conduct inline quality checks. For example, auto manufacturers commonly perform automated systems checks to detect paint defects, misalignment, or other mechanical components. These inline checks help ensure product quality in real time, reducing errors. 

Like auto manufacturers, health insurers should use automated checks to ensure billing accuracy. For example, leverage automation to compare the previous month’s invoices to the current month’s to find those with high variance. Or, automate the reconciliation of payments through scheduled processes that compare posted payments with transactions from lockboxes and other payment processors. 

The more automated checks you introduce into your billing process, the more errors you’ll reduce.

Perform Regular Software Updates

In 2017, the WannaCry ransomware attack affected organizations worldwide, including the UK’s National Health Service. It exploited a vulnerability in Microsoft Windows that had a security patch available. Updating that software could have prevented the attack.

If you use on-premise third-party billing solutions, you likely need to perform manual updates. Failing to do so could have adverse effects, including introducing errors in your billing process.

By comparison, cloud software is typically automatically updated. In our case, we follow a development cycle that includes two-week sprints. Those sprints include both new features as well as bug fixes. Customers automatically receive those features and fixes with each release. The process ensures you have the most recent software version, limiting bugs that may introduce billing errors.  

Much like the famous Bill Buckner error, where a single mistake had long-lasting consequences, billing errors can have a lasting impact on your organization. They can lead to financial losses, time wasted on rectifying mistakes, and even customer churn. 

To reduce billing errors in health insurance, prioritize ongoing training and comprehensive documentation, eliminate manual processes through automation, integrate your systems for data accuracy, automate quality checks to ensure billing accuracy, and perform regular software updates. 

These best practices create a robust billing process that can help safeguard your revenue, streamline operations, and provide a better experience for your customers. 

Certifi’s health insurance premium billing and payment solutions help healthcare payers improve member satisfaction while reducing administrative costs.


Download a Guide to Premium Billing Software for Health Insurers

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