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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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 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.

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.

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.

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.

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.

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.

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.

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.