All services

The medical billing and RCM glossary: 35 terms, explained the way you'll actually hear them.

Revenue cycle management runs on its own vocabulary, and a payer remittance or a denial letter uses that vocabulary without ever pausing to explain it. This is a working reference for the terms that come up most, grouped by where they show up in the billing cycle rather than alphabetically, since that is how you actually encounter them.

Claims and submission

Clean claim: A claim with no defect, error or missing information that would prevent it from being processed on first submission.
Claim scrubbing: Automated pre-submission checks that catch structural, coding and payer-specific errors before a claim leaves your system. See our claims scrubbing guide.
Rejection: A claim refused before it enters adjudication, usually for a structural or formatting reason. Rejections can be corrected and resubmitted freely and are not appeals.
Clearinghouse: An intermediary that translates and routes electronic claims between a practice's billing system and each payer, and returns rejection and acknowledgment reports.
837P / 837I: The HIPAA-standard electronic claim transactions: 837P for professional claims (CMS-1500), 837I for institutional claims (UB-04). See our CMS-1500 vs UB-04 guide.
Timely filing limit: The payer-set deadline, measured from the date of service, after which a claim will not be accepted regardless of accuracy.
Superbill: An itemized form documenting a patient encounter, including diagnosis and procedure codes, used as the source document for claim creation.
Charge capture: The process of recording every billable service performed during an encounter before it is coded and submitted; a missed charge here is revenue that never gets billed at all.

Coding

CPT code: Current Procedural Terminology: the code set describing procedures and services performed by a provider, maintained by the American Medical Association.
ICD-10-CM: The code set describing diagnoses and reasons for a visit; it justifies why a procedure was medically necessary.
HCPCS Level II: A code set covering supplies, equipment and services not included in CPT, such as durable medical equipment and certain drugs.
Modifier: A two-character code appended to a CPT or HCPCS code to indicate a service was altered in some way without changing its core definition, for example performed bilaterally or as a distinct procedure.
NCCI edit: A National Correct Coding Initiative rule identifying code pairs that should not normally be billed together for the same patient on the same date.
MUE (Medically Unlikely Edit): The maximum number of units of a given code that would be reported for one patient on one date of service under most circumstances.
RVU: Relative Value Unit: the unit Medicare uses to measure the resources a service requires, combined across work, practice expense and malpractice components to calculate payment.
Bundling / unbundling: Bundling is billing a group of related services under one comprehensive code; unbundling, billing the components separately when a bundled code applies, is a common cause of denial and audit exposure.
HCC coding: Hierarchical Condition Category coding: risk-adjustment coding used mainly for Medicare Advantage, where diagnosis coding accuracy affects capitated payment rather than a per-claim payment.

Payment and adjustments

EOB: Explanation of Benefits: the payer's summary sent to the patient (and often the provider) showing what was billed, what was covered and what the patient owes.
ERA (835): Electronic Remittance Advice: the electronic equivalent of an EOB sent to the provider, in the standard 835 transaction format, used to auto-post payments.
Allowed amount: The maximum a payer will pay for a covered service under its contract with the provider, regardless of the amount actually billed.
Contractual adjustment: The difference between the billed charge and the allowed amount, which the provider agreed to write off as a condition of being in-network.
Coordination of benefits (COB): The process of determining which payer is primary when a patient has more than one insurance plan, so claims are billed in the correct order.
Capitation: A payment model where a provider receives a fixed amount per patient per period regardless of how many services that patient uses, shifting utilization risk to the provider.
Fee-for-service: A payment model where the provider is paid for each individual service rendered, the more common alternative to capitation.
Coinsurance, copay, deductible: Three distinct patient cost-sharing types: coinsurance is a percentage of the allowed amount, a copay is a fixed dollar amount per visit, and a deductible is the amount a patient pays out of pocket before the plan starts sharing costs.

Denials and accounts receivable

Denial: A claim that entered adjudication and was refused payment, in whole or in part, for a specific reason the payer must state. Unlike a rejection, a denial requires a formal appeal within a set window.
Appeal: A formal request asking a payer to reconsider a denial, typically requiring supporting documentation and submitted within the payer's specific deadline.
Days in A/R: The average number of days between billing a claim and receiving payment; a rising number signals a slowing revenue cycle before it shows up anywhere else.
Aging bucket: A grouping of outstanding claims by how long they have been unpaid, typically 0–30, 31–60, 61–90 and 90-plus days, used to prioritize collection follow-up.
Claim adjustment group codes (CO, PR, OA, PI): Codes on a remittance identifying who is responsible for an unpaid amount: CO is a contractual obligation the provider cannot bill the patient for, PR is patient responsibility, OA and PI cover other adjustment and payer-initiated categories.
Write-off: An amount removed from a patient or payer balance because it will not be collected, whether contractually required, deemed uncollectible, or approved as a courtesy adjustment.

Credentialing and compliance

NPI: National Provider Identifier: a unique ten-digit number for individual providers (Type 1) or organizations (Type 2), required on every claim.
CAQH ProView: A centralized credentialing data profile most commercial payers pull from rather than requesting documents individually; it must be kept current and re-attested on a schedule.
PECOS: The Medicare Provider Enrollment, Chain and Ownership System used to submit and manage Medicare enrollment applications. See our Medicare credentialing guide.
Credentialing vs. enrollment: Credentialing is a payer verifying a provider's qualifications; enrollment is registering that credentialed provider to actually bill the payer. They are sequential, not interchangeable.
Revalidation: A periodic requirement, common with Medicare and Medicaid, to reconfirm enrollment information on file; missing the deadline can deactivate billing privileges.
BAA: Business Associate Agreement: a HIPAA-required contract between a covered entity and any vendor that handles protected health information on its behalf.

Still translating remittance codes by hand?

We run eligibility, coding, submission, denial management and credentialing under one team, so the vocabulary above is our daily work, not yours.

Talk to a specialist