What’s the Difference Between Medical Billing and Coding?

Although both medical billers and coders are essential to a provider’s bottom line, you will need to know the difference between medical billing and coding if you plan to pursue a career in one of these professions. 

Are You Considering a Career in Medical Billing or Coding?

Maybe you have thought about working in healthcare and are considering a medical billing or coding career. But you aren’t sure exactly what these jobs entail. To make a well-informed decision, it’s important to know what medical billers and coders do, in what settings they work, and how much they make.  

Is Medical Billing and Medical Coding the Same Thing?  

No, medical billing is not the same as medical coding. Medical billing and coding professionals play a critical role in the reimbursement cycle to ensure that providers get paid accurately for the services they provide. However, billing and coding are two separate professions, and often the individuals work in two different areas. Still, the same person may carry out the coding and billing responsibilities in some cases.  

Because billers and coders share a close working relationship in healthcare, educational programs often combine both topics into one program. Doing this gives the student a big-picture look at how it all works together.

You may also find that some educational programs offer combined courses where medical coding, billing, and medical terminology & anatomy are included in a bundle.

What Medical Billers Do

Medical billers process insurance claims so that physicians and staff get paid for the services rendered. They use medical billing software to create a claim after the codes have been entered into the system.

They also communicate with patients, medical professionals, and insurance carriers responsible for submitting payment.

If authorization is required from an insurance carrier before performing a procedure, the billing professional will probably be the individual to call the insurers for a guarantee of payment. They will follow up on overdue invoices by contacting patients, submitting claims to collection agencies, and appealing denied claims.

Furthermore, billers discuss with patients their deductibles, copays, and other requirements based on their insurance plan.

What Medical Coders Do

Medical coders basically explain what took place during a patient visit. Their job is to review the documentation provided by the physician and translate the information into medical codes. 

For instance, a physician may see a patient for a check-up, or a physician may have ordered an X-ray for an acute traumatic injury. Whatever the reason for the visit, a specific code should be assigned for each diagnosis and procedure or service provided for accurate reimbursement.

These codes are assigned based on the national classification systems and may be entered into computer software, handwritten notes, or paper and electronic files.

A medical coder uses ICD-10-CM, CPT, and HCPCS Level II classification systems in an outpatient setting. In an inpatient setting, a medical coder uses ICD-10-CM and ICD-10-PCS.  

Reporting the right codes based on the provider’s documentation tells the payers the medical necessity for a procedure, service, or supplies given to a patient. If there is any question about the documentation, the coder needs to discuss it with staff members or query the physician.

Where They Work

According to AAPC, medical billers and coders work in a vast number of different settings:

• Physician offices
• Hospitals
• Ambulatory surgery centers
• Urgent care clinics
• Sports medicine clinics
• Mental health practices
• Hospices
• Telehealth providers
• Collection agencies
• Risk adjustment vendors
• Insurance companies
• Professional liability companies
• Federal government agencies
• And many other settings

Working From Home

A question I have seen asked many times from those considering a career in medical billing or coding is, “Can I work from home?” I’m here to tell you that it’s possible. 

In years past, only experienced billers and coders could work from home. An employer wanted to make sure the biller or coder could do the job well without constant supervision before letting them work from home. 

After all, the quality of a coder’s work determines how the physicians get paid for the services they provide. In addition, the job involves highly confidential information, and the coder must protect the patient information.

In 2020, the shutdown occurred, and billers and coders were sent home to do their jobs. They continued working from home until the end of 2020. Then in 2021, AAPC conducted a survey in which 51% of their respondents stated they continued to telecommute due to advancements in technology that keep electronic health records (EHR) HIPAA compliant via remote access.

This advancement in technology could mean that entry-level coders may see more opportunities for telecommuting in the future.

What They Make in $

With all this complexity and attention to detail, medical billing and coding are challenging careers, and they also pay a decent salary.

I can almost hear you saying, “what’s decent?” Well, I’ll share the numbers with you and let you decide. 

U.S. Bureau of Labor Statistics

The Occupational Outlook Handbook published by the U.S. Bureau of Labor Statistics (BLS)  indicates that the median pay in 2020 for medical records and health information specialists was $45,240 per year or $21.75 per hour. 

As BLS reports, employment in these healthcare occupations is projected to grow by 9% through 2030. That is about as fast as the average growth for all occupations. The increase is mainly due to the number of aging people needing more healthcare services.

Over the decade, about 34,300 openings for these specialists are projected each year, on average.

AAPC and AHIMA Salary Surveys

AAPC (formerly known as the American Academy of Professional Coders) and AHIMA (American Health Information Management Association) conducted salary surveys to obtain salary information from their members. The findings in the two surveys reflect the members’ experiences and perspectives.

Although the salaries by the survey respondents are self-reported, it gives us an idea of what employers value.

If you are not familiar with these two organizations, they are the two main credentialing organizations for billers and coders, and other healthcare professionals. Therefore, if you want to get hired as a medical biller or coder, you will want to be certified through one of these two organizations.

AAPC U.S. Salary Survey

In 2021, AAPC invited tens of thousands of health information professionals to participate in their Medical Coding and Billing Salary Survey, which they conduct every year. The survey aims to show us the salary trends within the industry. Based on the results for 2021, salary trends and future growth look promising.

Different factors can determine your salary as a medical biller or coder. Such factors include certification, experience, specialty/medical field, employer type, and location.

AAPC Salary Survey Results

According to the survey, the approximate salaries for medical billers and coders, on average, per year are: 

• Medical coders: $54,797. This figure includes certified and non-certified coders. 
• Medical billers and coders who are not certified: $47,200
• Medical billers and coders who are certified: $60,097. 
• Professional coders with two credentials earn: $64,712 
• Billing and coding specialists with three or more credentials: $69,942

The above salaries are not starting salaries. They are average salaries based on the 2021 survey respondents who have a median 10 years in the industry.

The approximate average annual salaries based on certification are:

• Certified Professional Biller (CPB): $56,652
• Certified Professional Coder (CPC): $58,055 
• Certified Outpatient Coder (COC): $62,846 
• Certified Professional Coder-Payer (CPC-P): $60,753
• Certified Inpatient Coder (CIC): $57,936 
• Certified Risk Adjustment Coder (CRC): $64,995 

Again, these are not starting salaries. An entry-level coder with a CPC credential makes approximately $45,456 per year. With experience, the coder can expect a salary increase of 60% throughout his or her career as a CPC. Opportunities are also available for advancement into higher-paying healthcare business roles. 

For more detailed information and a complete list of salaries by AAPC credential, see their Medical Coding and Billing Salary Report.  

AHIMA U.S. Salary Survey

AHIMA published its U.S. Salary Survey Report in 2019. The survey reflected the input of more than 3,000 U.S. health information professionals, with the average survey participant having had over 20 years of experience working full time in the industry.

According to the respondents who participated in the survey:

• 44% of the respondents work in the revenue cycle management, coding professionals, collections, auditors, and insurance and billing coordinators. 
• 27% are in operations and medical records Administration: HIM managers and directors, consultants, administrators, registrars, and technicians. 
• 29% work in Compliance and Risk Management; Clinical Documentation Improvement; Education; Informatics and Data Analytics; IT and Infrastructure.

Like medical coders and billers credentialed through AAPC, AHIMA’s credentialed members are compensated according to their certification, experience, specialty/medical field, employer type, and location. 

AHIMA Salary Survey Results

Approximate salaries, on average, per year for health information management (HIM) professionals are: 

• HIM professionals in the Revenue Cycle Management/Coding and Billing job family: $66,370
• HIM professionals with no credentials: $66,320
• HIM professionals with 1 credential: $75,540
• HIM professionals with 2 credentials: $82,620
• HIM professionals with 3 credentials: 89,960
• HIM professionals with 4 or more credentials: $113,950

Approximate average annual salaries based on certification include:

• Certified Coding Associate (CCA): $53,790
• Certified Coding Specialist (CCS): $79,060 
• Certified Coding Specialist-Physician Based (CCS-P): $77,790

Again, these are not starting salaries. 

The average annual salary for a CCA, CCS, and CCS-P credential based on years of experience in HIM are:

• CCA with one to two years of experience: $45,500 
• CCS with less than one year of experience: $39,125, but that number jumps to $60,160 with one to two years of experience.
• CCS-P with one to two years of experience: $45,020

Remember, the AHIMA survey was conducted in 2019, so consider that the average salaries have changed since then.

For more detailed information and a complete list of salaries by AHIMA credential, see their U.S. Salary Survey Report. 

My key takeaways from these two reports:

• If you are certified, you have a better chance of landing a job in medical billing and coding than if you are not certified. You also receive higher compensation.
• The more experience you have and the more certifications you have, the higher the salary.
• If you work for a large healthcare provider organization instead of a medical office or a solo physician practice, you can expect higher compensation — approximately 19% higher.

Conclusion

Medical billing and coding professionals are essential to the reimbursement process and can significantly impact a provider’s bottom line. However, they are two different jobs, even when one person is responsible for both. Hopefully, you now understand what billers and coders do, where they work, and roughly what they can expect to make.

And if you haven’t taken a medical billing or coding course yet, you may want to consider it, as the outlook for continued increased salaries and healthy growth in medical billing and coding looks promising. More telecommuting opportunities also look good in the future.

I highly recommend CCO (Certification Coaching Organization) for their medical billing and coding courses. You may choose to enroll in an individual course, or you may elect to take one of their course bundles which include medical coding and billing, plus medical terminology and anatomy (and more). The instructors and support are excellent.

No matter which course suits you, the price is definitely worth it for what you get. CCO also offers a payment plan.

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Related

• What is ICD-10-CM, ICD-10-PCS, CPT, and HCPCS?
• Understanding Medicare and Its Different Parts
• Is Medical Coding Your Professional Calling?
• 3 Reasons To Know Medical Terminology
• Perfect Practice Makes Perfect In Medical Coding