“denied” and a “rejected” claim, although the terms are commonly interchanged. A denied claim refers to a claim that has been processed and the insurer has found it to be not payable. A denied claim can usually be corrected and/or appealed for reconsideration. Insurers have to tell you why they've denied your claim and they have to let you know how you can dispute their decisions. A rejected claim refers to a claim that has not been processed by the insurer due to a fatal error in the information provided. Common causes for a claim to reject include when personal information is inaccurate (i.e.: name and identification number do not match) or errors in the information provided (i.e.: truncated procedure code, invalid diagnosis codes, etc.) A rejected claim has not been processed so it cannot be appealed. Instead, rejected claims need to be researched, corrected and resubmitted. Electronic billing A practice that has interactions with the patient must now under HIPAA send most billing claims for services via electronic means. Prior to actually performing service and billing a patient, the care provider may use software to check the eligibility of the patient for the intended services with the patient's insurance company. This process uses the same standards and technologies as an electronic claims transmission with small changes to the transmission format, this format is known specifically as X12-270 Health Care Eligibility & Benefit Inquiry transaction. A response to an eligibility request is returned by the payer through a direct electronic connection or more commonly their website. This is called an X12-271 "Health Care Eligibility & Benefit Response" transaction. Most practice management/EM software will automate this transmission, hiding the process from the user. This first transaction for a claim for services is known technically as X12-837 or ANSI-837. This contains a large amount of data regarding the provider interaction as well as reference information about the practice and the patient. Following that submission, the payer will respond with an X12-997, simply acknowledging that the claim's submission was received and that it was accepted for further processing. When the claim(s) are actually adjudicated by the payer, the payer will ultimately respond with a X12-835 transaction, which shows the line-items of the claim that will be paid or denied; if paid, the amount; and if denied, the reason. Payment In order to be clear on the payment of a medical billing claim, the