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How to Do Behavioral Health Claims Processing4 min read

Behavioral Health Claims Processing
Behavioral Health claims processing is a critical aspect of healthcare services in the USA, especially in the field of psychiatry.

Behavioral health claims processing is an important part of healthcare services, especially in psychiatry and the behavioral health field. The process involves submitting a claim from a healthcare provider to a health insurance company, which then determines the eligibility of the claim and the amount to be reimbursed.

The Importance of Accurate Behavioral Health Claims Processing

In the field of psychiatry and behavioral health, the claims process can be complex due to the presence of multiple procedures, treatments, and medications. To ensure efficient and accurate claims processing, it’s crucial for medical billing services to understand the different types of claims and have a clear understanding of the necessary documentation.

There are two main types of claims in psychiatry and behavioral health: institutional claims and professional claims. Institutional claims are submitted by hospitals, while professional claims are submitted by individual practitioners.

Assessment of Patient Intake for Behavioral Health

To manage a patient’s billing during treatment, a thorough intake evaluation is required, which includes all necessary information. When a patient is admitted, the following steps should be taken:

  1. Take a photo of the patient’s insurance card and ID.
  2. Obtain their current address and telephone number.
  3. Determine their deductible and entrance costs.
  4. Have the patient sign relevant documents, such as:
  • Information disclosure about potential future billing issues
  • Permission to Treat
  • Authority of Attorney
  • Coordination of benefits
  • Financial Benefits Assignment
  • Notice of Privacy Practices under HIPAA
  • Permission to Appeal on the Patient’s Behalf
  • Signature of a parent or guardian (if the patient is a minor)

The documentation required for Medicare claims processing manual behavioral health may include diagnosis codes, treatment codes, service codes, dates of service, and amounts charged. A thorough intake evaluation provides the necessary data for obtaining prior authorization and explains the patient’s financial obligations, serving as the first step in a smooth billing process.

Identify Medical Needs

Before treating a patient and obtaining prior authorization, it’s important to understand how insurance determines medical necessity. If a treatment or level of care is deemed not medically necessary, the claim is unlikely to be approved.

Medical necessity refers to any medical service required to prevent, diagnose, or treat an illness, injury, ailment, disease, or one of its symptoms. Claim adjusters evaluate the following to determine medical necessity:

  1. Are the services supported by reliable and scientifically accepted data in the medical industry?
  2. Are the type, frequency, and length of services clinically appropriate?
  3. Is the treatment effective for the ailment it’s meant to cure and is it not more expensive than alternative treatments?

Ensuring Patient Data Accuracy

It’s important for all staff members, starting with front desk employees, to periodically verify and check patient information. An underpaid claim may result from even the smallest mistake, such as a misspelling in the patient’s name. Before admission, front desk staff should confirm:

  1. Patient characteristics
  2. Information about primary and secondary insurance
  3. Any co-payments required
  4. Any deductibles required
  5. The patient’s name, address, and date of birth

Sometimes, a patient’s insurance plan may expire while they are receiving therapy due to missed payments or an expired policy. To avoid this, it’s important to continuously check the patient’s benefits throughout their stay.

Other Considerations

Providers should be aware of different health insurance plans and their requirements, such as the need for prior authorization for certain treatments or restrictions on the number of visits allowed. Providers should also be familiar with reimbursement schedules for different procedures and treatments.

Providers in the healthcare industry must be cognizant of the laws and regulations that govern claims processing, such as the Health Insurance Portability and Accountability Act (HIPAA). HIPAA mandates that all health information must be safeguarded and that claims must be processed promptly and precisely. It is also advisable for providers to be knowledgeable of the appeals process in case a claim is denied.

When it comes to psychiatric billing, it is important to take note of updated psychiatric billing codes 2023. The Current Procedural Terminology (CPT) codes 90832-90838 are used to represent psychotherapy services. Services that do not include medical evaluation and management are reported using codes 90832, 90834, and 90837. When medical evaluation and management services are included, the codes for these services must be reported along with an additional psychotherapy add-on code (90833, 90836, 90838).


In conclusion, behavioral health claims processing plays a crucial role in psychiatry and behavioral health and is a complex process. Providers must be familiar with the various types of claims, necessary documentation, health insurance plans, and regulations to guarantee an accurate and efficient claims processing system.

Andrew Mark
Andrew Mark
As a healthcare IT expert, I bring extensive experience in revenue cycle management (RCM), medical billing, and coding. I am passionate about simplifying complex healthcare processes and empowering providers with efficient solutions.



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