What Is Charge Capture’s Role in Healthcare?
Learn how charge capture is fundamental to healthcare revenue cycle management, ensuring services are accurately billed and reimbursed.
Charge capture in healthcare is a process that ensures medical providers receive proper payment for the services they deliver. It involves recording all billable patient services, procedures, medications, and supplies. This activity is part of revenue cycle management, which encompasses the journey from patient registration to final reimbursement. Accurate charge capture directly impacts a healthcare organization’s ability to generate revenue and sustain its operations, preventing financial losses and billing inefficiencies.
Understanding Charge Capture
Charge capture is the process of documenting every billable service provided to a patient. Its purpose is to create a comprehensive record, allowing healthcare organizations to generate accurate claims for reimbursement from insurance companies, government programs like Medicare or Medicaid, or directly from patients. Accurate charge capture prevents revenue leakage, which occurs when services are provided but not billed or are under-billed. For example, the Healthcare Financial Management Association (HFMA) reports that medical practices can lose over $100,000 annually due to inefficient charge capture. This process contributes to appropriate and timely payments, supporting the organization’s financial stability.
Elements of a Charge
A healthcare charge encompasses various items and services that contribute to a patient’s overall bill, including:
- Medical procedures performed, such as surgeries or diagnostic imaging.
- Diagnostic tests, including laboratory work or specialized scans.
- Consultations with physicians or other healthcare professionals.
- Medications administered during a visit or prescribed.
- Medical supplies used, such as bandages or specialized equipment.
- Facility fees, covering the use of hospital or clinic space and resources.
The Charge Capture Workflow
The charge capture workflow begins at the point of patient care when a service is rendered. Clinicians document the services provided, including procedures, tests, and supplies, often within an Electronic Health Record (EHR) system. This documentation is then translated into standardized medical billing codes, such as Current Procedural Terminology (CPT) codes for procedures and International Classification of Diseases (ICD) codes for diagnoses, with medical coders performing this translation to ensure accuracy and compliance with payer requirements. Once coded, these charges are entered into the organization’s billing system, often checked against a “chargemaster” which lists the prices for various services. The billing staff then review and approve these entries before submitting claims to the appropriate payer for reimbursement.
Common Sources of Charge Capture Discrepancies
Charge capture discrepancies arise from several points within the revenue cycle. Incomplete or inaccurate clinical documentation is a widespread issue, as services provided may not be fully recorded, leading to missed or under-billed charges. Delays in charge entry, where there is a lag between service delivery and billing, can also result in missed deadlines for claim submission or forgotten charges. A lack of seamless integration between different healthcare information systems, such as EHRs and billing software, can create data transfer errors; additionally, human error during manual data entry or coding, given the complexity of thousands of medical codes, is another common source of mistakes. A lack of understanding among medical providers about accurate charge capture also contributes to omissions.