CPB Certified Professional Biller Certification Practice Exam

What is the term for an individual who provides services under an expressed or implied agreement?

1. Employee

2. Independent Contractor

3. Consultant

4. Freelancer

The correct answer is: Independent Contractor

An individual who provides services under an expressed or implied agreement is referred to as an independent contractor. This term encompasses those who work on a contractual basis rather than as a traditional employee. Independent contractors often have more flexibility in how they execute their services and are typically not subject to the same level of control or oversight that employees experience. They operate under their own business name and manage their own taxes and benefits, which differentiates them from employees who usually have taxes withheld by their employer and may receive benefits like health insurance or retirement plans. The context of this question is essential for understanding the nuances of employment classifications, especially in billing and coding professions. Independent contractors may be called upon for their expertise on specific projects without forming an employer-employee relationship, which can affect billing practices, tax responsibilities, and contractual obligations in healthcare settings. Therefore, identifying this distinction is crucial for professionals involved in medical billing and compliance.