What is a payer?

The payer is the insurance company that pays the doctor.

You will see the word everywhere in billing, because almost everything you do is aimed at one: you send a claim to a payer, you check eligibility with a payer, you enroll a practice with a payer, and you post the payer’s answer when it comes back.

Three things about payers are worth learning on day one.

Payers differ from each other, constantly. One will accept your claims with no setup at all. The next will not talk to you until the practice is enrolled. A third will happily pay you but will only send the explanation of that payment to an enrolled provider. See What is a payer enrollment, and do I need one for every payer?.

Every payer signs a contract with the practice. That contract sets the price the payer will actually pay for each service, which is the allowed amount. What you billed and what the contract says are two different numbers.

A payer answers in codes. When it pays less than you billed, or nothing at all, it tells you why with a denial or adjustment code rather than a sentence.