HS215 Unit 10 Revenue Cycle Billing Case Study Example

From the First Phone Call to a Zero Balance: A Unit 10 Billing Case Study of One New Patient With Back Pain

[Student Name]

Purdue University Global

HS215: Medical Insurance and Billing

Unit 10 Billing Case Study

[Instructor Name]

[Date]

The patient, practice, payer and amounts are composite; the manuals, survey and textbook cited are real.

Stage 1: Scheduling

A composite 45-year-old man calls a family practice for low back pain that began after moving furniture. The scheduler collects his name, birth date, phone number, reason for visit and insurance carrier and member ID from his card. He is booked as a new patient. What could go wrong: an insurance carrier recorded from memory. Prevention: the scheduler asks him to read the ID from the card.

Stage 2: Eligibility

Two days before the visit, the front desk verifies coverage electronically: active employer PPO, practice in network, office visit copay of [$35], deductible [$1,500] with [$600] met. What could go wrong: a plan change not yet updated. Prevention: at check-in, the patient is asked whether anything about his coverage has changed.

Stage 3: Registration and Check-In

He completes registration forms, signs the assignment of benefits and privacy acknowledgment, shows photo ID and pays the [$35] copay. The front desk scans both sides of the card. What could go wrong: a misspelled name or wrong birth date, which can cause a rejection. Prevention: the registration is read back to him.

Stage 4: The Visit and Coding

The physician evaluates acute low back pain without nerve involvement, recommends activity and over-the-counter pain relief and does not order imaging. Coding follows the note: an evaluation and management service for a new patient, leveled by what the physician documented, and the ICD-10-CM code for low back pain, following official guidelines that the diagnosis reflect the documented assessment (Centers for Medicare & Medicaid Services, 2024).

What could go wrong: coding from the scheduling reason, "back pain after lifting," rather than the physician's assessment, or choosing a visit level higher than the note supports. Prevention: the coder works only from the signed note, and the practice audits a sample of visit levels each quarter. No imaging was ordered, which also matters for billing: had the physician ordered an MRI for uncomplicated back pain, many plans would have required prior authorization and some would have denied it as not medically necessary so early.

Stage 5: The Claim and a Clearinghouse Rejection

The claim is created and sent electronically through a clearinghouse, a company that checks claims for errors and forwards them to payers. Within hours, the clearinghouse returns a rejection: the subscriber's date of birth does not match the payer's records. A rejection is different from a denial: the payer never received or processed the claim, so it can be corrected and resent without an appeal (Smith, 2022). The biller compares the registration with the scanned card and finds that registration typed the birth year as [1980] instead of [1981]. The correction is made in the patient's record and the claim is resent the same day.

A rejection caught at the clearinghouse costs a few minutes; the same error found weeks later as a denial can cost an appeal and a delayed payment.

Stage 6: Adjudication and Payment

The payer processes the claim. The electronic remittance advice shows: billed [$220], allowed [$154], contractual adjustment [$66], copay already collected [$35], plan paid [$95.20], patient responsibility [$23.80] applied to coinsurance after the copay rule specific to his plan. The biller posts the payment and adjustment to the account.

Stage 7: Patient Statement

A statement is mailed showing the visit, the insurance payment, the copay already paid and a balance of [$23.80], with plain explanations and payment options. Deductibles and coinsurance in employer plans mean small balances like this are common (KFF, 2024).

Stage 8: Zero Balance

He pays online two weeks later. The account reaches zero and is closed.

What a Denial Would Have Looked Like

Had the date-of-birth error slipped past the clearinghouse, the payer might have received the claim and denied it for a subscriber mismatch. The fix would then have required a corrected claim referencing the original, with the delay of another processing cycle, perhaps two to four weeks. If the error had been in the diagnosis rather than the demographics, for example a code that did not support the visit, the practice might have needed to appeal with the note attached. Comparing these paths shows why practices invest in clean registration: each step upstream that catches an error saves several steps downstream.

Lessons From the Whole Cycle

Three lessons connect the course. Most problems begin at the front: scheduling and registration errors create later rejections and denials. Rejections and denials differ, and knowing which one occurred decides the fix. And the patient experiences the cycle mainly through the copay and the statement, so clear explanations at those points prevent confusion.

Timeline

Scheduling call: day 0. Eligibility: day 3. Visit: day 5. Claim sent and rejected: day 6. Claim resent: day 6. Payment received: day 20. Statement mailed: day 21. Balance paid: day 35.

References

Centers for Medicare & Medicaid Services. (2024). ICD-10-CM official guidelines for coding and reporting FY 2025. U.S. Department of Health and Human Services.

KFF. (2024). 2024 employer health benefits survey. KFF.

Smith, L. M. (2022). Fordney's medical insurance and billing (16th ed.). Elsevier.