Healthcare Clearinghouses: What Are They & How Can They Help?

What are medical clearinghouses?

Medical clearinghouses are electronic warehouses that allow healthcare practices to transmit electronic healthcare claMedical clearinghouses are electronic warehouses that allow healthcare practices to transmit electronic healthcare claims to insurance carriers. Additionally, clearinghouses offer a way to send and manage electronic claims. A clearinghouse in the healthcare billing world is an organization that acts as a sort of intermediary that forwards claims from healthcare providers to payers. The core functions of an EDI clearinghouse have traditionally been centered around the scrubbing of claims. Claims scrubbing procedures (or claims cleaning) lead to the creation of claims with a lower chance for denial before they are delivered to the payer. 

What are the primary functions of a clearinghouse?

Pre-encounter Administration

Clearinghouses help you by providing real-time insurance eligibility verification. The clearinghouse can communicate with your practice’s patient management system in order to perform the benefit check. These checks —done using eMEDIX’s Patient Responsibility Estimation tool — are based on the patient’s demographics and insurance information that was entered during patient registration.

Patient-Provider Encounter

Healthcare clearinghouses assist with the compliant coding of patient encounters by accelerating the rate of reimbursement, while reducing potential audit risk.


Clearinghouses will assist with the submission of claims to payers electronically and can help by enabling medical billing staff to fix any claim errors quickly (prior to re-submission). Clearinghouses also provide smooth connectivity to payers so that ERAs (Electronic Remittance Advice) are received by your billing software (EMR, EHR, etc.). 

Denial Management, Prevention & Recovery

Denial management starts from denial prevention which plays a key role in your denial management strategy. The quality of a particular clearinghouse’s claims scrubber and eligibility verification can definitely help to reduce the probability of denials. Denial management tools — such as Revenue Resolve — can help you to ensure that each denial has been appropriately addressed. Clearinghouses can support your ability to accomplish this task by identifying the root causes of your denials and can create a denial prevention strategy for the future.

Why might payers and providers choose to partner with a healthcare clearinghouse?

Are all clearinghouses “created equal”?

When doing your research, realize that not all clearinghouses are the same. A full-featured clearinghouse will be able to improve the entire billing and collections process from claim submission through to workflow management.

Partnering with the right company can help your organization to streamline revenue cycles, improve cash flow, and maximize profits by allowing you to centralize your medical billing and coding processes.

The best clearinghouses offer high-value features — such as eMEDIX Online — that provide RCM intelligence within a single-sign on platform. With customizable workflows that allow you to work claims at every point within the life cycle of a medical bill, the services offered by these clearinghouses can be extremely compelling from a financial perspective and also important from an office efficiency perspective.

Most errors that lead to denials or rejections for claims are caused during manual claims entry. Additionally, it takes an average of 8.5 minutes to manually key claims versus the seconds it can take to enter claims using the assist of clearinghouse software in a program like Claims Connection. So, not only are you spending more time that you could be using for something valuable (like seeing patients) when you’re manually re-keying claims, but you greatly increase the chances that those claims will be rejected or denied. Denied claims will then have to be re-worked which means even more time lost.

What are the main benefits of a medical billing clearinghouse?

Reduction in Claims Denials

Correct claim information will reduce the number of denials simply by reducing rejections triggered as a result of typos. Because clearinghouses scrub and review claims before they are ever sent to the payer, it’s far more likely that the payer will approve the claims. Revenue Resolve allows you to centralize these processes and allows you to prioritize your denied claims.

Faster Data Transfer

Paper claims can take an eternity to process. Clearinghouses work with electronic claims. Tools like eMEDIX’s Statement Manager allow you to work on claims and statements online. EDI clearinghouse procedures, which may have taken days previously, will take only seconds with tools provided to you from the right clearinghouse. Everything from enrollment – using tools like EZ Enroll – to basic claims management can take place in a centralized platform, anytime, anywhere. This high-speed transfer of data can streamline your medical billing workflow, saving valuable time that is best spent on patients. Easily submit your claims to different insurers at the same time through the single-sign-on system provided by the clearinghouse.

Secure, Compliant, Reliable

Not only are claims processed more quickly, but they are processed securely. Clearinghouses essentially function as electronic hubs that allow healthcare practices to transmit claims to insurance providers in ways that ensure that your PHI (Protected Health Information) remains secure. By protecting PHI, medical billing clearinghouses can ensure that you are staying HIPAA compliant. These HIPAA-covered entities can process multiple claims to a variety of insurance companies so that your claims remain compliant while allowing you to overcome potential software incompatibility.

Fewer Errors

Medical clearinghouse software (an excellent coding resource) catches errors that a user may have made during the data entry process. Manual claims submission is notorious for being riddled with inaccuracies and mistakes, such as transposing a middle initial or incorrectly typing a provider number. Clearinghouses offer you the ability to “scrub” or “clean” your claims. This process allows providers to quickly check whether or not a claim will pass the basic requirements for a particular payer. Don’t let errors derail your chances of getting paid. 

Consistency & Accountability

Not only can you reduce errors, but you can increase your accountability and consistency with your 835s. You should be receiving an 835 and payment within a consistent timeframe for each claim (so that you can post and reconcile your payments in a timely manner). When you can count on receiving 835s and payments quickly, then you and your staff don’t have to waste time trying to track down delayed payments.

Decreased Turnaround Times

Faster and more reliable healthcare coverage determination and claim submission allows providers shorter payment cycles, and as a by-product, more accurate financial forecasts. 
Partnering with the right clearinghouse can help you to improve cash flow and maximize profits by streamlining your revenue workflows.

Are you looking for more information on medical clearinghouses? Contact us.

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