Medical Billing

Payment Posting: What Is it and Why Is it Important?

In medical billing, a common cause of errors is not implementing a payment posting method. This can lead to unhappy patients and, even worse, can muddle a practice’s entire financial picture. With intentional payment posting in medical billing, not only can you avoid all potential oversights, but you’ll have a thorough insight into your daily revenue system.

Payment posting has an influence on many aspects of healthcare service practices. Specifically, it impacts the efficiency and financial development of your practice, as well as the nursing care.

What Is Payment Posting in Medical Billing?

receptionist accepting a payment for payment posting in medical billing

Payment posting is a system allowing for the complete view of received payments and cash flow of a medical practice. It provides access to documents such as an explanation of benefits (EOB) and electronic remittance advice (ERA) from insurance companies, as well as payments from patients. The process strives to identify causes of revenue loss or financial errors in order to present a clear financial picture.

After the adjudication of a patient’s claim, which can either be paid or denied, the healthcare service receives an EOB document from the health insurance company. If the patient is processing the claim towards the payment, the patient is able to send the provider a check or an EFT with the EOB. Finally, the patient will sign the assignment of benefits (AOB) document, through which they allow reimbursement for their medical care to be sent directly from their health insurance company to their healthcare provider.

Types of payment posting

Depending on the level of insurance coverage and the patient’s financial capabilities, you can approach payment posting in one of two ways. Though they differ in execution, they have the same end goal.


As you can tell from the name, auto-posting is a software-based approach to the process. Because it utilizes software technology, it’s much faster and leaves little room for error. This is why a lot of healthcare providers prefer auto-payment posting to manually doing it. However, if the practitioner is solo, they may opt for manual posting since it’s simpler and cheaper.

Auto-posting collects payments from revenue sources, automatically records them, and then provides a full report on the financial status of the healthcare practice.

a bookkeeper attending to posting payments

Manual posting

Manual posting is done manually, usually with no software. Administrative staff executes this by filling out information by hand. One can also scan images from the EOB document and post each line onto the patient’s account. This method is slower and more prone to errors. Despite that, solo practitioners find this method to be more suitable for their needs.

The Importance of Accurate Payment Posting

Payment posting is one of the most important administrative tasks in medical billing. It allows practitioners to monitor their payments and discover errors. Besides patient payments, it also provides information about health insurance payments. Medical billing goes through multiple steps, each vital in maintaining a steady revenue stream. If a problem arises, the revenue stream risks disruption. A disturbance to the revenue flow could significantly limit a practitioner’s ability to treat patients on time.

Payment Posting Benefits

There aren’t many drawbacks to payment posting, but there sure are plenty of benefits. Here’s why you should start implementing this process.

  1. Revenue Cycle Analyzing —  You can start examining the revenue cycle and identifying opportunities for growth. Using revenue cycle analysis helps maximize your revenue cycle, which increases profitability. This also improves the operations of the accounts receivable department.
doctor handing patient note - what is payment posting
  1. Solving Recurring Problems —  Problems can be a frequent obstacle in medical billing. However, you can easily solve recurring problems by tracking adjustments and denials. Determining why a claim was denied is essential to resolving the issue and preventing future denials. 
  1. Reducing Denial Resolution Time — The primary method in preventing fraud in medical billing is updating new billing and coding through monitoring coorespondence with the payers. Correcting denied claims and reimbursing the insurers is critical, as unresolved denials add to your accounts receivable days.
  1. Strengthening of Existing Processes — When the above-mentioned benefits take effect, you’ll notice an immediate improvement in existing processes. With a perfected method, you can fully focus on patient care and other medical tasks.

Where Does Payment Posting Fit in the Revenue Cycle? 

Whether you handle billing in-house or use a billing service to accept payments, payment posting is a great fit for your revenue cycle. Through an effective method, you can identify growth opportunities by being on the lookout for daily, weekly, and monthly trends.

Evaluating the Payment Posting Process

doctor reclining after learning payment posting definition

The first step towards a successful payment posting process is having a well-trained staff. Accuracy and productivity are key factors in the billing process, but quick reactions are also important. You should find staff embodying these traits.

The timeliness with which you post payments is important to keep in mind. A neglected or unorganized payment posting process can result in a bill being sent to someone who already paid their bill. This reflects poorly on the professionalism of the practice.

Evaluating your payment posting process from time to time is important for flawless medical billing.

Final Thoughts 

There are two methods of payment posting from which to choose: auto-posting and manual posting. Auto-posting utilizes software technology, whereas manual posting does not.

Payment posting in billing is an imperative tool for medical practices. It allows you to view payments, as well as various documents from insurance companies. Crucial to any practitioner, payment posting can facilitate the billing processes and maximize the revenue cycle.