Health care charging and pricing processes different from other industries

Write paper (750-1,000 words) that describes the processes used in producing a final bill.
Answer the following questions in your discussion:
1.How are health care charging and pricing processes different from other industries?
2.How do private and government insurers and payers impact actual reimbursement?

Coder Interview

In this paper, I will report the findings of an interview that I conducted in which the
respondent was a specified health care provider situated in New York. The facility is a major
provider of in and out-patient medical care. The rationale for selecting the care provider was that
it has a coder/billing process, which it uses to satisfy reimbursement requirements for billing
purposes. Hence, the facility fits the aim of this paper particularly well. From the information
provided by the respondent, it is apparent that the multi-faceted billing approval process and the
flat rates are what set the medical coding process from the procedures adopted in other markets.
Besides, the paper takes the standpoint that the role of government and private insurers
determining how reimbursement is done is rather conflicting.
How are health care charging and pricing processes different from other industries?
One of the principal purposes of the interview was to identify how different healthcare
and pricing processes are from other industries. In line with Feldstein’s (2012) thoughts, it was
revealed that, unlike in other sectors, charging and pricing processes in a medical institution is

not executed by a single person. Instead, coding in such an organization requires the approval not
only from the front office administrators but also the back office. Usually, the billing and coding
process commences when a patient arrives at the care center. It can also start when a patient
schedules an appointment with a physician (Feldstein, 2012). It only ends when the final
reimbursement is collected from an insurance firm from which the client has an existing health
insurance policy. In other industries, charging is initiated and completed at the point of sale.
Besides, businesses in other industries do not deal with third parties such as insurance
The interview responses also revealed that, in stark contrast to the other sectors, medical
care facilities, especially for inpatient services, usually charge flat fees for all diagnosis-related
cases. While this is the case, as it was revealed during the interview, to accommodate complex
cases that require care facilities to use resources that exceed what has been reserved for
diagnosis-related cases, most care facility systems provide what Feldstein (2012) acknowledges
as “outlier” payments. In the other sectors, while a customer may seek related products and
services, he or she is charged different prices, depending on some specified factors. This means
that there is nothing like flat fees in such sectors.
How do private and government insurers and payers impact actual reimbursement?
The interview also sought to determine whether private and government insurers and
payers impact the actual reimbursement. Several discoveries, which have been reflected in the
existing research, were made. According to the respondent, the government is the largest single
health care payer in the U.S. (Troy, 2015). As such, the government has considerable authority to
determine how much it is to reimburse the care facilities for services rendered. As a matter of
fact, through Medicare and Medicaid, what the federal government reimburses is subsidized.

Private health insurance companies, as well, influence reimbursements, according to the
interviews I conducted. In line with Troy’s (2015) thoughts, private insurance companies
negotiate costs with the affiliated care centers on behalf of the clients. While this is the case, with
private insurers, there is always a cap. Thus, private insurers will only reimburse care providers
up to the specified amount. It is a patient to pay in the case that the limit is exceeded.


In conclusion, the interview that I conducted with the coder was an enlightening one. As
evidenced in the report above, the approach that is used by organizations in the health sector is
entirely different, given that the process of billing is executed by some departments before it
goes through. The issue of flat rates and “Outliers” also define the difference between coding in
the medical domain and other spheres. The interview also revealed that both the government and
private insurers along with payers impact reimbursements. However, while the government
insurer seeks to subsidize the reimbursement, private insurers put a limit on what medical centers
are to be compensated.



Feldstein, P. J. (2012). Health care economics. Belmont, CA: Cengage Learning.
Troy, T. D. (2015). How the Government as a Payer Shapes the Health Care Marketplace.
American Health Policy Institute.