How to Bill Medicare as a Provider: Explanation and FAQ

As you manage day-to-day responsibilities at your facility or residence, you may face a learning curve when it comes to billing for services. The medical insurance process can certainly be challenging, so if you’re wondering about how to bill Medicare as a provider, you’re not alone.

If you manage a long-term care facility in particular, you likely coordinate with Medicare on a regular basis. We’ll explore the basics of Medicare, the steps you’ll need to take to become a Medicare provider, and common questions related to billing to help you navigate the process more confidently.

What Is Medicare?

Medicare is a federal health insurance program — managed by the Centers for Medicare and Medicaid Services (CMS) — for people who are 65 years or older and younger individuals with specific diagnoses. More than 60 million people are enrolled in Medicare in the U.S., which makes it a key component of the healthcare billing system. Medicare payments are broken down into three main parts.

• Medicare Part A: Insurance for hospital stays, skilled nursing facility care, hospice, and some home health care options.
• Medicare Part B: Covers medical care such as outpatient care, doctor’s visits, medical supplies, and preventative care.
• Medicare Part D: Provides insurance coverage for the cost of prescription drugs.

Keep track of the part of Medicare that your service falls under as you determine how to bill Medicare as a provider, as some patients only qualify for certain types of coverage. Also, if a patient has another form of health insurance, Medicare may act as a secondary payer in billing transactions.

How To Become a Medicare Provider

Before figuring out how to bill Medicare as a provider, you’ll need to enroll in their system. CMS outlines a straightforward process to apply for Medicare provider credentialing. The first step is to determine whether you’re registering simply as a “provider” or as an “institutional provider.”

• Provider: A healthcare provider who wants to bill Medicare for their services and is able to order and certify those services. You can also enroll as a provider for a number of other reasons, as outlined on the CMS site.
• Institutional Provider: Used to enroll a hospital, critical care facility, skilled nursing facility (SNF), home health agency, hospice, or an institution that provides similar type of care.

Once you determine the type of enrollment you’ll need to complete, follow the steps below. Keep in mind that you may have already completed some of these requirements, and some parts of the process apply only to institutional provider applications.

Step 1: Obtain an NPI Number

Apply for an NPI number through the National Plan and Provider Enumeration System (NPPES). This standardized number will be used to identify you or your institution as the healthcare provider in billing transactions. If you already have an NPI number, you can move on to the second step.

Step 2: Apply for Medicare Enrollment

The next step is to submit an application through the Medicare Provider Enrollment, Chain, and Ownership System (PECOS). You can do this by visiting the enrollment website, creating an account, and submitting an electronic application.

Step 3: Pay the Application Fee

If you’re registering as an institutional provider, you’ll need to pay a fee along with the submission of your application materials. To determine annual fee amounts, refer to the PECOS Medicare Fee Payment website. It’s important to note that application costs are not required for regular provider enrollment, just for institutional providers.

Step 4: Connect With Your MAC

All applications are processed by Medicare Administrative Contractors (MACs), who review your materials and let you know if any additional information is required. Your MAC can provide updates about your application status and answer questions that arise throughout the process.

In the case of institutional applications, the MAC will then refer your application for approval by your CMS Location and State Agency. Once these groups evaluate your application, they’ll communicate the results back to your MAC for final processing. Bear in mind that these groups may require site visits or surveys of your facility as part of the evaluation process.

How to Bill Medicare as a Provider: FAQs

Once you’re enrolled as a provider with CMS, you can start billing for your Medicare provider services. Refer to the questions below as you navigate the claims process.

How Do I Bill Medicare Electronically?

Many healthcare facility administrators want to know how to submit Medicare claims electronically to streamline the billing process. The good news is that CMS has a system in place. Claims can be submitted to a MAC using electronic devices that meet federal regulations related to patient privacy under the Healthcare Insurance Portability and Accountability Act (HIPAA).

Using compliant direct data entry (DDE) screens, you will electronically transmit the claim to your MAC, who will perform edits to determine if it meets HIPAA requirements. If they identify any errors in your claims in the early stages, they’ll send them back to you for correction and resubmission. Then, you’ll receive final notification about whether the claims were approved or denied.

What Payment Will I Receive From Medicare?

The CMS uses a standardized system — the resource-based relative value scale (RBRVS) — to determine the amount they will pay providers for their services. This amount is based on the resources required to perform a particular service, and can vary depending on the geographic location, specialty, and type of provider providing the care. Refer to the RBRVS fee schedule to calculate potential payments ahead of time.

What Billing Responsibilities Do I Have as a Provider?

Keep in mind that CMS has specific expectations as you learn how to bill Medicare as a provider. First, they require that you provide updates about any changes to your enrollment information — changes in ownership, adverse legal action against your organization, or transitions to a new location must be reported within 30 days. Any other updates to enrollment data must be reported within 90 days, and can be updated in the PECOS online system.

Additionally, providers need to carefully document and maintain patient information related to employment and insurance. If a patient has a primary insurer other than Medicare, it’s imperative that a provider bills accurately to avoid excess billing to Medicare. Refer to the CMS website for further explanation of provider billing responsibilities.

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