If you're just starting out as a medical billing company, one of the first decisions you have to make is what claims you're going to support. In other words, who are you going to bill? Because of all the complexities involved with medical billing procedures, we can't possibly cover all the pros and cons of billing each type of agency but we will cover the main points. This way, if you are just starting out, you can decide what kind of claims and carriers you want to support.

Let's start with billing Medicare. Medicare is one of the oldest carriers in the United States. It is run by the government but each region and office is independent and has slightly different rules. So you'll have to check for uniformity between them. That is one of the drawbacks of billing Medicare. They should all be the same, but subtle differences make them difficult to bill the same way.

Another drawback of billing Medicare is that they are run by the government. The US government is notorious for its red tape. The amount of time it could take to get a claim paid via Medicare is better measured in dog years than people years. In the case of a disputed claim, you may never see the money until you're old and gray.

The good part about billing Medicare is that because they are a government agency, they are non- profit. So whatever they are supposed to pay you for a claim, as long as it is in their pricing guide as such, they WILL pay you. No questions asked as long as it is a valid claim. In that respect, you can't beat Medicare as far as knowing what your income is going to be because you know what you will be paid up front.

With billing a private insurance company like Prudential, you pretty much have the opposite problem. Because Prudential is a profit making company, customer service is critical. So they will make every attempt to process a claim as quickly as possible. Of course, with the larger insurance companies, this isn't always true unless you are a very large account. The reason is because small accounts are looked at as insignificant and are treated as such by large companies. If you are a small company, you are better off going with a small insurance company.

Also, because a private insurance company like Prudential has to make a profit for its shareholders, you won't always get the money for a claim that you expect. In some cases, you may get anywhere from 75% all the way down to 35% of the original billing cost of the claim. Don't expect to fight these companies and win this. They'll pull out all sorts of statistics, backed by lawyers, as to why your claim is only worth so much money. So with the large insurance companies, it's pretty much be happy with what you get and be glad you got it.