What Are Referrals In Medical Billing and Why Are They Needed?

Many times, your primary care doctor must have asked you to see a specialist, to get expert advice and care to manage your clinical condition.  Seeking assistance from another specialist for additional services and management is considered as a “Referral” in Medical Billing.

The fundamental thing about ‘Referral’ is that you need to take consent from your primary health care doctor before you take an appointment from another specialist. If not, your health insurance plan will not be responsible to bear the cost of the appointment consequently.

In order to make sure that you get paid for the treatment, a ‘Referral’ from your doctor is a must. Under medical billing, it is a significant record obtained from a provider so that you can acquire the specialized services from a specialist, your doctor has referred you to.

What are the essentials for the referrals that one needs to keep in mind?

• Referrals should be in a written format and not verbally told to you for further acceptance by another doctor.
• It must be officially signed by the practitioner who has given you a referral to show it to the specialist.
• It must mention the date of approval such that a patient can use it within the time period of 18 months.
• The Primary care doctor must specify the treatment in the referral for the specialist to consider it.
• Adequate particulars about the patient’s health condition should be provided in the referral.
• The primary care doctor should ideally provide the referral to the patient before he/she intends to get the specialized services in another clinic/health maintenance organization (HMO) for a smooth medical process once the treatment is done.
• In circumstances of emergency, referrals in a written format is not required.

What is the process of Referral?

The Referral process begins with your primary care doctor who attempts to ascertain if you need to undergo specialized services in another healthcare organization, following which your doctor will issue a referral.

For example, you have been diagnosed with a chronic kidney disease with abdominal pain and frequent fevers, your family doctor would need to seek an opinion from a nephrologist and depending on the opinion, the family doctor will request the nephrologist to take over the treatment. This request will be reviewed under your healthcare plan to check the approval requirements. Following the approval, the family doctor will be notified.

The patients, before they approach their specialist should have a file containing a record of clinical findings, any treatment if he underwent before the referral and the specific reason for which the referral has been made.

Your doctor will then help to coordinate your visit and the referral provided thereafter will help to make sure you get adequate care when you meet a specialist.

During this, the family doctor may continue to look after your health, if necessary!

Why is Referral needed? 

There are some medical treatments, which may need a precertification or prior authorization before your healthcare claim can be processed or before treatment services are rendered.  Some health care plans do not require any such referrals but sometimes there are some specialists who wish to consult your family doctor before they begin your treatment.

Following are a few reasons for why Referrals are needed?

• When your doctor struggles to diagnose
• When a doctor has insufficient time to evaluate the patient
• For assistance in ruling out potentially dangerous health condition
• When a patient needs special care and management within the limits of his health care plan
• When a patient planning an inpatient stay in the hospital
• When a patient has been ordered home health care by the primary provider
• When a patient is assured that his treatment can be done in a cost effective manner at a better specialized health organization.

Benefits of Referral

For patients: 

• Immediate diagnosis and management
• Saves time and the treatment becomes cost effective
• Better health outcomes

For the family doctor:

• The doctor gets to learn how to deal with the disease
• Communication between the healthcare staff and the specialists at a different organization increases
• He can easily track the health status reports of his patient even when he is not treating him directly.

For the consultant:

• Improve the quality of the patient’s management
• Have additional time to spend with the patient
• His feedback to the family doctor can help the patient use his healthcare plan effectively