Claim Scrubbing and Submission
Catch errors before a claim leaves the practice, and understand the path a claim takes from submission to payment.
By the end of this lesson you can
- Explain what claim scrubbing does and why it pays for itself
- Describe the path from submission through adjudication to remittance
- Read an explanation of benefits and an electronic remittance advice
- Post payments and adjustments correctly
Lesson Notes
Read through the key concepts before you try the challenge.
Catch it before it leaves
You run the billing cycle at Lakeside Medical Associates.
A claim rejected by the clearinghouse costs a few minutes to fix. The same error caught after the payer denies it costs weeks of turnaround and a follow-up call, and may push the claim toward its filing deadline. The error is identical; only when it was caught differs.
Your task: Understand scrubbing well enough to make the first-pass rate the number you manage.
Claim scrubbing runs claims against a rules engine before submission — checking code validity, required modifiers, diagnosis-to-procedure linkage, NCCI edits, and payer-specific requirements. Every error it catches is an error that never becomes a denial.
| Stage | What happens | Typical timing |
|---|---|---|
| Charge entry | Codes and charges entered | Day of service or next day |
| Scrubbing | Rules engine checks the claim | Immediate |
| Submission | Transmitted to the clearinghouse | Daily batch |
| Clearinghouse edits | Format and payer-rule validation | Same day |
| Payer receipt | Acknowledgement returned | 1-2 days |
| Adjudication | Payer decides what to pay | 7-30 days |
| Remittance | Payment and explanation returned | With payment |
| Posting | Payment and adjustments recorded | On receipt |
The payer returns its decision as an explanation of benefits, or electronically as an 835 remittance advice. It shows, per service line, the billed amount, the allowed amount, the contractual adjustment, what the plan paid, and what the patient owes — along with reason codes explaining any reduction.
Posting a remittance correctly
Post a line showing billed $340, allowed $186, plan paid $148.80, patient responsibility $37.20.
- 1
Post the payment of $148.80 against the claim.
The actual money received. Straightforward, and the part everyone gets right.
- 2
Post the $154 difference as a contractual adjustment.
Billed minus allowed. This is written off under the payer contract and may never be billed to the patient — posting it as anything else, or leaving it as an open balance, misstates the practice's receivables and risks an improper patient bill.
- 3
Move the $37.20 to patient responsibility.
The coinsurance or deductible portion becomes the patient's balance and enters the patient billing cycle. Leaving it against insurance means it is never billed to anyone.
- 4
Read the reason codes even when the line paid as expected.
Reason codes explain reductions and often flag a pattern — a modifier consistently missing, a code repeatedly bundled. Posting mechanically without reading them means you fix individual claims and never the cause producing them.
Result: The account balances to zero against insurance, with $37.20 correctly owed by the patient.
Payment, contractual adjustment, patient responsibility. Read the reason codes — they are where the recurring problems announce themselves.
Why is a claim error caught by a scrubber far cheaper than the same error caught by the payer?
Challenge
Apply what you've learned in this lesson.
Practice reading a remittance, which is most of a biller's daily work.
- Find a sample explanation of benefits online. Identify the billed amount, allowed amount, contractual adjustment, plan payment, and patient responsibility for one line.
- Research CARC and RARC codes. Explain what each set is for and find three examples of each.
- For a line showing billed $500, allowed $300, paid $240, calculate the contractual adjustment and the patient responsibility, and state what percentage coinsurance that implies.
- Describe a weekly routine for reviewing reason codes across all remittances, and say what you would be looking for.
Finished this lesson?
Progress is saved in this browser only. It is not a grade — official progress lives in Brightspace.