Direct Billing

Last Updated: December 24, 2017

Definition - What does Direct Billing mean?

Direct billing is the process of a health care provider billing an insurance company directly for services rendered to a policyholder. It saves the patient from having to do all the paperwork on their own. In other words, it makes the process of filing health insurance claims easier and less time-consuming.

Insuranceopedia explains Direct Billing

Direct billing is an alternative to individuals having to file claims themselves. In other types of insurance, this is how it is done. However, health insurance claims are often filed more frequently than in other areas of insurance. For example, for a five-year period, a person may have cause to file one auto insurance claim, but dozens of health insurance claims. Due to the higher frequency of health insurance claims, it is beneficial to the health insurance industry to use direct billing, which speeds up the process. All parties benefit: The insurer settles the claim faster, the health care provider gets paid faster, and the patient doesn't have to do the paperwork.

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