When patients receive medical care, the billing process typically involves either first-party claims (billed directly to the patient) or third-party claims (billed to insurance). Understanding first-party medical bill claims is crucial for healthcare providers—especially when dealing with self-pay patients, high-deductible plans, or denied insurance claims.
What Are First-Party Medical Bill Claims?
A first-party medical bill claim is when a healthcare provider bills the patient directly for services, rather than submitting claims to an insurance company. This happens in cases such as:
✔ Self-pay patients (no insurance coverage)
✔ High-deductible health plans (HDHPs) where patients pay out-of-pocket first
✔ Non-covered services (cosmetic procedures, certain therapies)
✔ Denied or out-of-network claims where insurance won’t pay
Unlike third-party billing (where insurers handle payments), first-party billing requires clear communication, flexible payment options, and efficient follow-up to ensure timely collections.
Key Challenges in First-Party Billing
1. Patient Payment Uncertainty
Many patients don’t expect large medical bills and may struggle to pay.
Solution:
- Provide cost estimates upfront (as required by the No Surprises Act).
- Offer payment plans or discounts for prompt payment.
2. Higher Risk of Unpaid Bills
Patients may delay or ignore invoices, increasing bad debt.
Solution:
- Implement automated payment reminders (email, text).
- Use credit card on file systems for recurring payments.
3. Compliance & Legal Risks
First-party billing must follow federal (HIPAA, FDCPA) and state collections laws.
Solution:
- Train staff on ethical collections practices.
- Work with a medical billing credentialing services provider to ensure compliance.
Best Practices for Managing First-Party Claims
1. Verify Insurance First (Even for Self-Pay Patients)
- Some patients assume they’re uninsured but actually have coverage.
- A medical billing credentialing services team can help verify coverage before labeling a patient as self-pay.
2. Offer Multiple Payment Options
- Credit/debit cards
- HSA/FSA payments
- Payment plans (0% interest options)
- Online portals for easy payments
3. Send Clear, Itemized Bills
- Avoid confusion by breaking down charges (procedure codes, dates).
- Include instructions for payment or financial assistance.
4. Follow Up Strategically
- First notice: Sent immediately after service
- Second notice: 15-30 days later
- Final notice: 45-60 days, with possible collections referral
When to Consider Outsourcing First-Party Billing
Managing first-party claims in-house can be time-consuming and costly. Many providers partner with a medical billing credentialing services firm to:
✅ Improve collections rates (reducing bad debt)
✅ Ensure legal compliance (avoiding fines)
✅ Automate patient billing & reminders
✅ Handle disputes & payment plans professionally
Final Thoughts
First-party medical bill claims require a different approach than insurance billing. By implementing clear communication, flexible payment options, and efficient follow-up, providers can reduce unpaid balances and maintain cash flow.
For practices struggling with self-pay collections, medical credentialing services can streamline the process while keeping compliance intact.
Need help with first-party billing? Concept Billing Solutions specializes in patient collections & credentialing—contact us today!
