In charge of a healthcare facility? Looking to start your own specialized practice?
If so, you’re in charge of numerous significant decisions on a daily basis. From managing client care to hiring employees to run daily operations, there’s rarely a dull or slow moment in the medical industry.
Are you considering whether or not you should outsource medical billing? Or, are you convinced that it’s cheaper and easier to keep the job done in-house?
We’ve got the complete guide on the ins and outs of outsourced medical billing. Let’s get to it!
Pros of Outsourcing Medical Billing
Medical billing can be a time-consuming and arduous task for small medical practices. That said, there are several advantages to outsourcing.
Fewer Billing Errors
While there isn’t an exact figure available, some research suggests that up to 80-90% of all medical bills contain some kind of error. There’s no doubt that these mistakes are frustrating for both you and your patients.
When you outsource with a billing company, you’re paying for competence and efficiency. In other words, your claims will be accurate and prompt.
This standard of care reduces costly billing errors, and fewer errors mean fewer rejected/denied claims. That, in turn, can translate to the highest level of reimbursements on your claims.
Improve Cash Flow
In all businesses, cash flow is a crucial factor. When you outsource your medical billing, you can end up saving tens of thousands in revenue. That’s because you won’t need to hire in-house staff (and incur costs like healthcare, taxes, etc), pay for billing software subscriptions, or update your computer equipment.
Furthermore, you don’t need to worry about steep capital investments. If you are just starting your practice, the cost of in-house staff is expensive. You may need to account for training, equipment, and office space.
Some billing companies charge flat rates per claim, while others charge a percentage based on the total claim reimbursement. Regardless of their fee structure, it still tends to be cheaper than hiring in-house staff.
We all know that healthcare is constantly evolving. One standard today may be obsolete tomorrow. Moreover, it can be challenging, if not impossible, to keep up with all the trends each insurance company maintains.
Billing companies, however, have to stay current with payer trends. These changing trends are especially important if your agency accepts Medicaid or Medicare. Unlike you, billing agencies have to be aware of the regulations and requirements if they want to succeed.
Because processing claims is a billing company’s sole focus, it ensures that your facility maintains compliance. You won’t have to worry about the slight changes in reimbursement rules.
Access To Data and Analytics
Your billing service will be able to provide a birds-eye view of your company’s fiscal health. For example, are you still getting denied for certain kinds of claims?
As mentioned, competent billing companies can significantly reduce coding errors. That said, they may also be able to provide you with insight into the best ways to code for certain claims.
You’ll also know your status with regards to your receivables. You’ll see the percentage of claims paid out from the initial submission compared to 30, 60 or 90 days outstanding. (This data is valuable information that you may not be able to receive from an in-house biller.)
Safety In The Event of Audits
Audits are scary and time-consuming, but a professional billing company can save you unnecessary headaches.
That’s because they provide expert advocacy in the event of an audit. Because they ensure compliance, they have all documents and data readily available, and they’ll know how to speak and represent the claims on your behalf.
More Focus on Client Care
No matter your specialty, competent healthcare always has one core focus: excellent and unforgettable client care. Without that at the center of your practice, you’re missing the point of what you do.
By outsourcing, you naturally free up your time. Having more time provides you with more energy and resources to focus on quality patient care.
If you are a smaller practice, you may not be able to afford extensive medical office staff. And if you’re juggling all the nuances of billing on top of minimal staffing, it will be challenging to devote your time appropriately.
Without excellent client care, you risk alienating your patients. If that happens, you risk going out of business!
Cons of Outsourcing Billing
All decisions have pros and cons. If you run a medical practice, it’s essential that you also consider the pitfalls that choosing a poor medical billing service can create:
When you have an in-house team, you can manage your employees and request certain tasks, if necessary.
However, when you outsource, you need to collaborate with the billing company to make changes. If your company is undergoing significant changes, you may need additional support to increase productivity or adapt to specific patient needs.
Make sure the medical billing provider you go with is one that can be reactionary and flexible to your needs.
Compromise Patient Satisfaction
Unfortunately, outsourcing could have a small impact on patient satisfaction. A lot of patients like the convenience of going to their doctor’s office, making direct payments and discussing their bill, as needed.
Always ask about the billing company’s approach to managing patient care. Do they speak on your behalf? Do they have a strategy for managing unhappy patients?
Going with the wrong billing provider could result in unhappy patients that aren’t satisfied with the communication between them and your practice. If you go with a provider, make sure you do your due diligence in asking the right questions to them upfront before making any final decision.
And remember, the right billing provider is going to give you the answers you deserve!
Although outsourcing medical billing may be cheaper than hiring staff, you need to be aware of the potential hidden costs.
For example, you need to consider the time and money spent dealing with contracts or legal fees. You may also need to hire a professional liaison for managing the communication between your office and the billing company.
Note that competent billing companies are transparent about their prices. They’ll let you know what fees to expect and when to expect them. Unreliable, cheaper companies may lure you in with enticing prices only to trick you later on.
Medical billing providers can help out quite a bit, as long as you choose the right one!
Different Types of Billing Companies
As you’ll learn, no two billing companies are precisely the same. It’s vital for you to determine the different types of options available in today’s market. It’s also essential to learn which specific services each company offers.
Home-based medical billing companies may be a good option if you’re on a limited budget and serve a smaller number of patients.
However, it is still crucial that the company has enough education and experience in healthcare to be suitable for the job. Smaller billing companies usually charge per job. Having fewer jobs, of course, means spending less money.
Physician Practice Management Services
Larger practices with hundreds of staff members naturally require more extensive coding and billing services. Larger scale billing companies are equipped to provide complete management over administration and billing tasks.
How To Choose The Right Billing Company
If you do choose to outsource, you are now faced with another crucial decision; How do you choose the right company? And, more importantly, how do you guarantee that they are the best for your company?
Know Your Budget
It’s rarely (if ever) a smart idea to choose your billing company based on price. Like anything in life, you tend to get what you pay for. Choosing the cheapest company may undoubtedly raise red flags about their competency and credibility.
Get a few quotes from different companies. Assess the pricing and services offered by each vendor, so you can gain insight on the price range that you can expect.
Remember that this is your opportunity to ask questions and receive the clarification you’ll need. How does the company specifically charge for a service? When, if ever, will other charges be applied? Are discounts available?
Assess Reputation and Past Experience
Just like you probably wouldn’t check into a hotel without reading the reviews, you shouldn’t hire a billing company without doing your market research.
How long has the company been in business? What kinds of clients have they served? Can they provide real references who can vouch for their customer service?
Have any of your colleagues used them in the past? Better yet, do your colleagues have any recommendations regarding vendors they liked – and vendors they didn’t like?
Consider Your Specialties
If you have a general practice, specialties may not be much of a concern. However, if you focus on a niche population, you may require more specialized billing.
If this is the case, you need to inquire about the vendor’s competence in your specialty. Have they had past experience working with other clients like you? Do they approach their billing (or fees) any differently?
Competent companies want to guarantee your satisfaction. They also want to ensure compliance. Therefore, they will tell you if they cannot adapt to your company’s needs.
Consider Staff Size
While you may not consider the staff size when outsourcing work, it does matter when it comes to your billing. Large, complicated projects may require more experts, especially if it’s a peak time.
Will you be working with the same employees? Who will be your point-of-contact if you have questions or concerns?
Better yet, how will you be communicating with the staff? Via email or phone? Will you have access to unlimited communication?
Determine Customer Support
Did you know that 40% of Americans report that they believe businesses now pay more attention to customer service? This is an important trend to consider when looking for your billing company because you want a provider that values you as much as you value them.
Let’s be honest. It’s easy to like a company when everything is going right. But, what happens when problems start to surface? What happens when issues fall between the cracks?
You want to be working with a company that isn’t afraid of dealing with tough issues. For example, what is their average collection rate? What about their average processing rate? How do they handle dissatisfied customers?
Should You Outsource Medical Billing?
The decision to outsource medical billing may not be a simple one, so don’t rush into making the choice before you’re ready. Doing so may be costly and inefficient.
Instead, it’s best to consider what your practice needs. Do you plan to continue growing and expanding? Do you want to remove some of the excess work associated with billing and hiring staff?
At Absolute Medical Billing, we pride ourselves on providing expert coding and superior practice consulting. Our dedicated team of professionals is here to help your organization every step of the way.
Are you interested in learning more about what we have to offer? Contact us today to get started.