Clearing House – Complete Guide

What Is a Clearing House?

A Clearing House is a secure electronic gateway between providers and insurance companies. It checks claims for errors, applies payer-specific edits, converts them into HIPAA-compliant formats, and forwards them to the correct payer for adjudication. It helps reduce denials, improve first-pass acceptance rates, and speed up reimbursements.

Why Do We Use a Clearing House?

• Reduces claim errors and rejections
• Ensures HIPAA-compliant formats
• Sends claims to multiple payers from one place
• Improves clean claim rate
• Tracks every claim with real-time updates

Types of Clearing Houses

1. Direct Clearing House
Connects directly to payers like Medicare MACs.

2. Multi-Payer Clearing House
Supports thousands of payers from one system.

Major Clearing Houses

• Change Healthcare (Optum)
• Availity
• Waystar
• Office Ally
• Trizetto
• Experian Health
• ClaimRemedi

Key Functions

• Claim scrubbing
• EDI file conversion (837, 835, 277, 270/271)
Eligibility verification (270/271)
• Routing claims to correct payers
• Sending acceptance/rejection reports
• Delivers ERA (835) & claim responses
• Claim status updates (276/277)

Benefits

• Faster payments
• Faster reimbursement timelines
• Higher clean claim rate
• Fewer denials
• Less manual work
• Better visibility across all claims

Clearing House Workflow

1. Provider submits claim from PMS (837)
2. Clearing House validates & scrubs
3. Scrubber checks coding/data edits
4. Accepted claims go to payer; rejected return to provider
5. Payer adjudicates and sends 277CA + ERA
6. Provider posts payment and closes AR

What Is a Scrubber?

A scrubber is a rules engine that checks claims for data errors, coding conflicts, missing fields, invalid modifiers, NPI issues, and payer-specific policy violations before sending them to the payer. A scrubber report highlights exactly what needs correction so the claim becomes clean and ready for payment.

How Eligibility Lookup Works

1. Provider sends a 270 eligibility request
2. Clearing House forwards it to payer
3. Payer sends 271 response
4. Shows coverage, copay, deductible, benefits
5. Displayed as readable report