Open, Closed Or Isolated Medical Billing System_ What Is The Best For Your Medical Practice?

Medical Billing System

Every healthcare business is striving to gain a competitive edge in the marketplace. Due to the rising demands and expectations of the patients, medical practitioners have to take an active role in their business operations.

Especially, due to new value-based healthcare RCM models_ healthcare providers should adopt innovative medical billing solutions. These solutions streamline the payment collection procedures for healthcare facilities and maximize revenue stream.

Therefore, healthcare providers should consider innovative medical billing solutions as an integral part to make their business operations run smoothly. The question here arises is what kind of medical billing solution will suit best for your business operations?

In this article, I have compiled the list of medical billing solutions and how should medical practitioners select one!

But first, let’s understand what are the essentials of a medical billing system;

Medical Billing System:

This is the system that defines the set of procedures and protocols that work closely in the healthcare revenue cycle management.

This system is branched into three portions;

  1. Closed
  2. Open
  3. Isolated

Although, the medical billing system is a large network of interconnected operations that are associated with the medical administration. It is just not a one-click procedure i.e. to send a medical claim to insurance companies. However, a medical billing system is a wholesome procedure that starts right after the patient steps into the doctor’s office and ends up when the doctor gets paid for the services rendered.

Therefore, whenever you look for a medical billing solution then make sure that it meets your requirements. So you can ensure feasibility and reliability in your healthcare revenue cycle management.

Here are the major types of medical billing systems from which you have to choose the best for your healthcare business.


A closed medical billing system refers to the billing solution that doesn’t allow the transfer of information. Generally, a closed system is one that doesn’t allow exposure of anything from any of its ends.

Similarly, a closed billing system doesn’t let anyone transfer any bit of data. The major example of a closed billing system is EMR (electronic medical records).

EMR is almost used in every healthcare practice. Its layout is quite similar to the digital version of the old-school charts. Although the template is old, the technology is suitable for today’s practices.

EMRs are interoperable and dynamic in nature. Therefore, we can connect multiple EMRs with each other. Hence, they are creating a non-disclosure system that is referred to as a closed billing system.

As a result, it doesn’t allow any third-party (it could be a software system, doctor and other healthcare facilities) to access the information in the records.


If you’re running a small-sized healthcare business that hasn’t hired any third-party management then EMR is a go-to option.

However, if you are a large-sized healthcare organization or a hospital that requires multiple departments to share patients’ records. Then below is a good option for your practice.


An open system refers to such a software solution that allows information sharing across it’s portals. Similarly, EHRS (electronic healthcare records) provide an open billing system that helps healthcare practitioners to share patient’s health records with different people and healthcare facilities (i.e. labs, imaging centers and patients).


So if you have decided to hire a third-party management e.g. an outsourcing medical billing company. Then you can use EHR, in that case, to communicate with their medical billing professionals.

That’s why EHRs are highly collaborative record-keeping tools. Because they enable healthcare providers to store, access and share information with great feasibility.

In fact, there are sub-categories of EHRs that even do not allow communication across its portals. Still, they are considered open billing systems because at least they allow patients to access their medical records.

HIPAA Compliance:

Now you might be thinking that if EHRs violate HIPAA compliance policy? No, they don’t. Because EHRs have dedicated and distinctive portals for healthcare providers, patients and lab professionals.

All HIPAA protocols are applied to each portal. Hence, a particular entity can only access that information that is allowed by the HIPAA policy.


These billing systems are solely made for patients. PHRs (personal healthcare records) provide complete access only to the patients.

Hence, healthcare providers, physicians and medical practices can’t access these isolated billing systems. Thus, patients have a complete hold of their healthcare records.


Patients actually use these billing systems to self-manage their healthcare records and medical history.

Patients usually don’t use PHRs but somehow they can use this system to fill out the official records for their healthcare service providers. Also, these systems require open communication across the software and it needs to make sure that they can transfer their data easily.

Final Verdict:

Each type of billing system has unique requirements and applications. It all depends upon the nature of stakeholders and the size of the healthcare business. Once, you’ve determined how you could use a billing system and where are you going to apply it. Then you can determine the best medical billing system for you.

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