With the advancements in the healthcare system, people are finding it progressively difficult to keep up with the industrial changes. From staying informed about industry-specific jargon, codes, and business names to being aware of the constant changes in government regulations, it can be overwhelming, even for professionals.
One key aspect of healthcare is understanding the difference between healthcare providers and payers, both of which are fundamental components of the medical system in the United States.
Who Are Healthcare Providers and Payers?
Healthcare Provider
A healthcare provider is a person or company that provides a healthcare service for you. Often, mistaken for a service plan, providers can be broadly classified into the following:
- Institutions: These are organizations such as hospitals, nursing homes, home health agencies, and ambulatory surgery centers.
- Individual practitioners: doctors, physician assistants, nurse practitioners, and therapists come under this category.
- Ancillary providers: These include durable medical equipment (Defibrillators, patient monitors, surgical tables, EKGs, anesthesia machines), x-rays, clinical laboratories, and outpatient services.
Healthcare Payer
Healthcare payers are responsible for credit collections, setting service rates, processing claims, and paying provider claims. Without payers, providers would not be reimbursed for their services, and patients would be responsible for the full cost of their care.
Some types of payers in the healthcare system are health plan providers, Medicare, Medicaid, and Veterans Affairs. Each payer has its own rules and regulations about coverage, reimbursement, and provider contracts.
Payers also have different relationships with providers. Some payers are directly contracted with providers, while others simply reimburse providers for their services.
The roles of healthcare providers and payers go hand-in-hand since the latter is responsible for ensuring that the former is compensated for their services and that patients can access affordable healthcare.
Why Is Understanding the Difference Between Healthcare Providers and Payers Important?
Knowing the difference between healthcare providers and payers helps you to navigate the US medical system in the following ways:
Navigating the Healthcare System
- Providers deliver medical services, diagnosing and treating patients.
- Payers finance healthcare services and determine coverage amounts.
Understanding these roles clarifies whom to contact for coverage questions (payers) and medical care (providers).
Making Informed Decisions
Knowing the financial dynamics between payers and providers helps in planning healthcare expenses and choosing treatments. Awareness of your insurance coverage helps manage costs and influences your choice of in-network providers to minimize out-of-pocket expenses.
Advocating for Yourself
Recognizing payer and provider roles aids in addressing coverage disputes and ensuring you receive necessary care within coverage constraints. This knowledge is vital for appealing denied services by payers and choosing quality providers within your insurance network.
Enhancing Healthcare Experience
A clear understanding of payer and provider roles leads to better communication and realistic expectations about healthcare services. This helps in efficiently resolving issues and managing costs and treatments effectively.
First Credit Services is a BPO company that strives to make the payment process between patients, healthcare providers, and payers as seamless as possible by offering effective medical accounts receivable management services. We utilize omnichannel engagement and highly trained medical collections staff to ensure higher reimbursement rates and shorter AR days.
Get to know more about First Credit Services and how we can help you optimize your revenue cycle process by visiting us online or giving us a call today.
