Final answer:
Medical billers must know a patient's insurance policy to facilitate correct billing and prevent claim denials, specifically addressing issues like coverage and adverse selection.
Step-by-step explanation:
It is true that medical billers should familiarize themselves with a patient's insurance policy when creating a claim. Understanding the details of an insurance policy, such as coverage limits, deductibles, co-payments, and the network of providers, is key for accurate billing and reimbursement. Knowledge of the insurance policy helps in preventing claim denials and ensures efficient handling of reimbursement for services rendered under fee-for-service systems or HMOs. Furthermore, with an understanding of the insurance policy, billers can address adverse selection, which affects how insurance products are priced and provided to consumers.