Q: What’s the difference between an 837 and an 835, and why should my clearinghouse care?

The 837 is your outbound electronic claim; the 835 is your inbound remittance/payment advice. The “best” clearinghouses make reassociation reliable so payments post accurately and exceptions are easy to resolve.

Question 1

What's the difference between a clearinghouse and a billing service?

Accepted Answer

A clearinghouse only processes and transmits claims - you still handle claim creation, follow-up, and payment posting. A medical billing service provides full revenue cycle management, including claim creation, submission, denial management, patient billing, and payment posting. Clearinghouses typically cost $0.25-$1.50 per claim, while billing services charge 4-8% of collections. Choose a clearinghouse if you want to maintain control over your billing process; choose a billing service if you want to outsource the entire revenue cycle.

Question 2

Do clearinghouses work with Medicare and Medicaid?

Accepted Answer

Most major clearinghouses support Medicare and Medicaid claims processing, but coverage varies by state for Medicaid programs. Medicare claims are generally well-supported across all clearinghouses due to standardized federal requirements. For Medicaid, you'll need to verify that your chosen clearinghouse works with your specific state's Medicaid program, as each state manages its own system. Some specialized behavioral health clearinghouses may have stronger relationships with state Medicaid behavioral health programs.

Question 3

Can I switch clearinghouses without losing data?

Accepted Answer

Yes, but the transition requires careful planning. Most clearinghouses can export your historical claims data, though formats may vary. You'll need to ensure pending claims complete processing before switching, or coordinate with both clearinghouses during transition. EHR systems designed for behavioral health, like ICANotes, often make this transition smoother by maintaining consistent data formats and having established relationships with multiple clearinghouse partners. The biggest challenge is typically reconfiguring your practice management system, though behavioral health-specific EHRs usually offer support during clearinghouse transitions.

Question 4

What’s the difference between an 837 and an 835, and why should my clearinghouse care?

Accepted Answer

The 837 is your outbound electronic claim; the 835 is your inbound remittance/payment advice. The “best” clearinghouses make reassociation reliable so payments post accurately and exceptions are easy to resolve.

Question 5

How do I identify the best clearinghouse for medical billing as a small behavioral health practice?

Accepted Answer

Start with a shortlist of your top payers, verify direct connectivity, request a 30-day POC using your live mix, and score vendors on behavioral-health edits, 835 posting quality, support SLAs, uptime history, and total cost (not just per-claim fees).

Question 6

Is accreditation worth it for clearinghouses?

Accepted Answer

Yes, accreditation programs now administered by DirectTrust (formerly EHNAC) indicate strong controls around privacy, security, and transaction integrity. Ask vendors which programs they hold and for current attestation dates.

Question 7

What should I ask about uptime and incident response?

Accepted Answer

Request historical uptime and documented incident reports (RTO/RPO, failover design, communications). The 2024 Change Healthcare outage showed how fragile revenue cycles can be when a major network is down; resilience planning matters.

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