The therapy billing glossary, searchable

The standard electronic file a payer sends back after processing your claims — the machine-readable twin of the EOB. Your billing software or clearinghouse reads it to post payments and adjustments automatically. When people say ERA, this file is what they mean.

See also: ERA (electronic remittance advice), EOB (explanation of benefits), Clearinghouse

The standard electronic file format for professional claims — the P covers individual clinicians, including therapists. When you submit a claim electronically, your software packages it as an 837P and sends it through a clearinghouse to the payer.

See also: Clearinghouse, Clean claim

Agreeing to take the payer’s payment directly and accept the allowed amount as payment in full for the covered portion. In-network contracts require it. Out-of-network it is a checkbox choice on the claim — and if you don’t accept assignment, some payers send the check to the client, which means you get to ask them for it.

See also: In-network, Allowed amount, Superbill

The payer’s internal process of working through your claim: verifying coverage, applying the contract, and deciding what to pay, deny, or send to the deductible. A claim “in adjudication” is simply in the queue — most payers finish within one to four weeks.

See also: Denial, Allowed amount

The most a payer will recognize for a service under your contract — usually less than your full fee. The payer’s share plus the client’s share always add up to the allowed amount; the gap between it and your fee becomes a write-off.

See also: Write-off, Coinsurance, Fee schedule

A formal request asking a payer to reconsider a denied claim, usually a short letter plus supporting documentation, filed before a deadline. A surprising number of denials get overturned simply because someone bothered to appeal.

See also: Denial, Corrected claim, Clawback (recoupment)

Billing the client for the gap between your full fee and the allowed amount. In-network contracts flatly prohibit it — that gap is your write-off. Out-of-network it is simply how things work: the client owes your fee, and their plan reimburses whatever their benefits allow. Knowing which side of that line you are on prevents the angriest phone calls in billing.

See also: Write-off, Allowed amount, Good Faith Estimate (GFE)

A central online profile of your license, training, and practice details that most payers pull from during credentialing instead of asking you directly. Keep it current and re-attest when prompted — a stale CAQH profile quietly stalls credentialing everywhere at once.

See also: Credentialing, Panel

The standardized codes on ERAs and EOBs that explain what happened to every dollar. CARCs give the reason — CO-45 is the routine contractual write-off, CO-197 means no authorization on file — and RARCs add the fine print. Learn the half-dozen you see repeatedly and a cryptic remittance turns into a to-do list.

Translate any CARC or RARC with the denial code decoder

See also: Denial, ERA (electronic remittance advice), Write-off

When a payer takes back money it already paid you — often months later, after an audit or an eligibility correction — usually by deducting it from a future remittance. Clawbacks can be disputed, and sometimes should be.

See also: Appeal, ERA (electronic remittance advice)

A claim with nothing wrong: correct codes, identifiers, dates, and client details, so the payer can process it without asking questions. Clean claims get paid in weeks. Everything else joins a pile.

See also: Rejection, Clearinghouse, Timely filing

A service that sits between you and every payer: it checks claims for obvious errors, translates them into each payer’s required format, and delivers them. It also carries remittances (835 files) back to you, so you have one connection instead of forty.

See also: 837P, 835, Payer ID, Rejection

The percentage of the allowed amount the client owes once their deductible is met. If the allowed amount is $120 and their coinsurance is 20 percent, they owe $24 and the plan pays the rest.

See also: Deductible, Copay, Allowed amount

The rules that decide which plan pays first when a client has more than one. The primary plan pays its share, then the secondary considers what remains. Claims stall when the payer’s COB records are out of date — the fix is usually the client calling their plan.

See also: Eligibility, Secondary claim, Denial

A flat dollar amount the client pays per session — say $25 — set by their plan. Copays typically apply whether or not the deductible is met, and the cleanest habit is collecting them at the time of service.

See also: Coinsurance, Deductible

A resubmission that replaces a claim the payer already processed — flagged with frequency code 7 and the original claim number, so it is treated as a correction rather than denied as a duplicate. The fix for your own mistakes; an appeal is the fix for the payer’s.

See also: Denial, Rejection, Secondary claim

The five-digit code that tells the payer what service you provided. Therapy lives in a small set: 90791 for the intake, 90837 for a session of 53 minutes or more, 90834 for 45 minutes, 90847 for family or couples work. The code — not your description — determines the payment.

Not sure which code fits? Use the free CPT code picker

See also: Modifier, ICD-10 code, Units

A payer’s process of verifying who you are — license, education, malpractice coverage, work history — before admitting you to its network. It commonly takes 60 to 150 days, and you generally cannot bill in-network for dates of service before it is complete.

See also: CAQH, Panel, W-9, In-network

The amount a client must pay out of pocket each plan year before their insurance starts sharing costs. Until it is met, the client owes the full allowed amount for every session — which is why January surprises so many people.

See also: Coinsurance, Copay, Out-of-pocket maximum, Eligibility

A claim the payer processed and decided not to pay, with a reason code explaining why. A denial made it through the system and got a no — the response is a correction or an appeal, not a blind resubmission.

Holding a denial? Paste the code into the denial code decoder

See also: Rejection, CARC / RARC codes, Appeal, Medical necessity

An employer-paid benefit covering a fixed number of free sessions — often three to eight — billed to the EAP vendor rather than the health plan, usually with an authorization number and the HJ modifier. When the sessions run out, care can often continue under the client’s regular insurance, sometimes with you still in the chair.

See also: Payer, Modifier, Prior authorization

Signing up with a payer to be paid by direct deposit instead of mailed checks, usually paired with ERA enrollment so the money and the remittance arrive together. Do it with every payer you join — otherwise some will pay you by “virtual card,” which quietly takes a processing percentage out of every payment.

See also: ERA (electronic remittance advice), Clearinghouse

A check on whether a client’s coverage is active and what it actually includes — deductible status, copay, mental health benefits, telehealth rules. Running it before the first session prevents the most common billing surprise there is.

See also: Deductible, Prior authorization

The statement a payer produces after processing a claim: what was billed, what was allowed, what the plan paid, and what the client owes. It is not a bill — it is the payer showing its math. Clients receive one too, which is why they sometimes call you confused.

See also: ERA (electronic remittance advice), 835, Allowed amount

The electronic version of an EOB, delivered as an 835 file. Billing software reads it and posts payments and adjustments against the right claims automatically — no retyping from a paper statement.

See also: 835, CARC / RARC codes, EFT enrollment, EOB (explanation of benefits)

The payer’s list of allowed amounts for each CPT code under your contract — the source of every number on your remittances. You are entitled to see it before you sign, and it is worth requesting in writing: “competitive rates” on a recruiting call is not a number.

See also: Allowed amount, In-network, Credentialing

The written estimate of expected charges that the No Surprises Act requires for uninsured and self-pay clients — before the first session, and at least annually after that. For therapy it is usually your fee, a reasonable expected frequency, and the required disclosures. Not optional, but not hard either: a good template does most of the work.

Walk through the free GFE checklist

See also: Out-of-network (OON), Superbill, Balance billing

The diagnosis code — the why behind the service. F41.1 is generalized anxiety disorder, F33.1 is recurrent major depression, and so on. Every claim needs at least one, and it has to plausibly support the service you billed.

See also: CPT code, Medical necessity

You have a contract with the payer: you passed credentialing, accepted its rates, and agreed not to bill clients beyond the allowed amount. In exchange, clients pay less and the payer pays you directly.

See also: Out-of-network (OON), Credentialing, Fee schedule, Allowed amount

The payer’s standard for whether care is coverable at all: the diagnosis has to justify the service, and your documentation has to show it. Most therapy clears the bar easily — it becomes real during audits and reviews of long or twice-weekly courses of care. Your notes are the evidence, so let them connect the treatment to the diagnosis.

See also: Denial, ICD-10 code, Prior authorization

A two-character add-on that changes what a CPT code means. Therapists mostly see 95 for telehealth, plus occasional plan-specific ones like HJ for EAP sessions. A wrong or missing modifier is one of the classic denial reasons.

The CPT code picker pairs each code with the right modifiers

See also: CPT code, Place of service (POS) code, EAP (employee assistance program)

Your National Provider Identifier — the 10-digit number that identifies you on every claim. Individual clinicians carry a Type 1 NPI; a group practice also has a Type 2. It is free at nppes.cms.hhs.gov and yours for life.

See also: Taxonomy code, Rendering vs. billing provider

No contract with the payer. You set your own fee and the client pays you directly, then may seek partial reimbursement from their plan — usually with a superbill you provide. Their out-of-network benefits, if any, decide what comes back.

See also: Superbill, Balance billing, In-network, Single case agreement (SCA)

The ceiling on what a client pays in a plan year — deductible, copays, and coinsurance combined. Once they reach it, the plan pays the full allowed amount for covered care. Clients in weekly therapy sometimes hit it by fall, at which point their sessions quietly become free to them for the rest of the year.

See also: Deductible, Coinsurance

A payer’s roster of in-network providers; “getting on the panel” means finishing credentialing and signing the contract. Panels close when a payer decides it has enough of your specialty in your area — a business decision, not a judgment of you.

See also: Credentialing, CAQH

Any organization that pays claims: commercial insurers like Aetna, government programs like Medicare and Medicaid, and EAPs. Each has its own rules, rates, and quirks — which is most of what makes billing tedious.

See also: Payer ID, Clearinghouse, EAP (employee assistance program), Adjudication

The short code that routes a claim to the right payer through your clearinghouse — the payer’s electronic address. It sometimes differs from the brand name on the client’s card, which is how claims occasionally sail off to the wrong company. Your clearinghouse’s payer list, not the card, is the authority.

See also: Clearinghouse, Payer

A two-digit code for where the session happened: 11 is your office, 10 is telehealth with the client at home, 02 is telehealth somewhere else. Payers cross-check it against your modifiers, and a mismatch is an easy denial.

The CPT code picker matches POS codes and modifiers for you

See also: Modifier, Denial

The payer’s advance approval before certain services are covered. Routine psychotherapy rarely needs one, but some plans require it beyond a set number of sessions or for testing. No authorization on file usually means no payment, however appropriate the care.

See also: Eligibility, Retro-authorization, Denial

A claim bounced before processing because of a technical error — a malformed ID, a missing field, an impossible date. Unlike a denial, it never entered the payer’s system: you fix the error and resubmit. Rejections are corrected, not appealed.

Look up the code with the denial code decoder

See also: Denial, Corrected claim, Clean claim

Two roles on every claim: the rendering provider is the clinician who delivered the session — their Type 1 NPI — and the billing provider is the entity being paid, a group’s Type 2 NPI or you again in solo practice. In group practices, more denials trace back to these two fields than to anything clinical.

See also: NPI, Taxonomy code

An authorization requested after the service already happened, usually because coverage surfaced late or a crisis outran the paperwork. Some payers grant them within a short window; others refuse on principle. Possible, never promised — ask fast, and put the reason in writing.

See also: Prior authorization, Appeal

A claim sent to a client’s second insurance plan after the primary has paid, along with the primary’s EOB showing what remains. Coordination of benefits decides which plan is which. Secondary claims are fiddly enough that plenty of solo practices decline to file them — a legitimate choice, as long as your policies say so.

See also: Coordination of benefits (COB), Corrected claim

A one-off contract that pays an out-of-network therapist in-network rates for one specific client — typically because the network has no appropriate provider available. Negotiated case by case, and worth asking for more often than people do.

See also: Out-of-network (OON)

A detailed receipt you give out-of-network clients so they can pursue reimbursement themselves: your NPI, CPT and diagnosis codes, dates, and fees. You collect your full fee up front; the reimbursement is between the client and their plan.

Make one in a minute with the free superbill generator

See also: Out-of-network (OON), Good Faith Estimate (GFE), NPI, CPT code

A code describing your specialty — 103T00000X for psychologists, for example. It lives on your NPI record and in credentialing files, and a mismatch between the two can quietly break claims until someone reconciles them.

See also: NPI, Credentialing

Your contractual deadline for submitting a claim after the date of service — commonly 90 days to a year. Miss it and the payer denies the claim, and you usually cannot bill the client for it either. The most preventable way to lose money in billing.

See also: Denial, Clean claim

How many of a service you billed on a claim line. Psychotherapy codes are almost always one unit per session, because the duration is baked into the code itself — unlike the time-based codes common elsewhere in medicine.

See also: CPT code

The IRS form that gives a payer your legal name, tax ID, and address so it can pay you and report the income. You will hand one over during credentialing and again whenever your details change. Mismatches between your W-9, your NPI record, and CAQH are a classic silent cause of stalled enrollments and misdirected 1099s.

See also: Credentialing, EFT enrollment

The gap between your full fee and the allowed amount, which your in-network contract requires you to erase — you cannot bill the client for it. The same word covers balances you simply choose not to pursue.

See also: Allowed amount, Balance billing, In-network