The choice to outsource your medical billing can yield substantially better results than the choice to keep billing in-house. Why? Because a properly structured outsourced billing relationship insures that the medical billing company succeeds by making you succeed.
The average medical billing company's fee is a percentage of the practice's collections. As a result of this their compensation is directly proportional to to how much money they collect for your. In stark contrast to this are internal medical billing employees that are paid on an hourly basis. They are paid because they are at their desk, not because money is flowing into the practice's bank account.
This issue, however, is often not fully understood or appreciated by many providers. These providers frequently say: "the staff works directly for me in my office-- they are more loyal and will do a better job and I can see what they are doing". Experience has shown, however, that this is often not true.
In a recent meeting with a multi-physician provider practice I was told a tale that I have heard many times before. One of the offices multiple medical billers was out for a few days. While she was out her supervisor was looking through the billers desk for some information that was needed. What she found was over $40,000 worth of old claims that the biller had stuck in her bottom drawer and never billed. As if this was not bad enough, almost all of the claims were beyond the timely filing deadlines and the money was lost forever. When the medical biller was back in the office she was reprimanded for this horrendous error. She was not terminated - she kept her job despite the fact the office lost thousands of dollars because of this horrific medical billing performance.
Why wasn't more severe action taken? Because of concerns with upsetting the billing staff and exacerbating a staffing problem that existed. The biller was moved from follow-up to the front desk where she is now being trusted to collect the critical demographic information required to properly bill claims.
This volume of missing charges should not have gone unnoticed. There should have been multiple reports that could have identified such a problem. The practice, unfortunately, did not know how to properly utilize the capabilities of the billing system and so, the required reports were never run. Proper use of a billing system requires much investment in time and training, an investment that hourly employees often do not make. This $40,000 in unbilled charges is likely a proverbial roach of this practice - in other words, for the one you see there are likely hundreds you do not.
Utilizing a medical billing company is not a panacea for such situations, but if you insure the following actions are built into your agreement with the billing service, you should be in good shape:
- A fully integrated tracking system (charges by locations/provider and payments by source - lock box, office, PO Box) should be in place and you should have full visibility into the system at all times.
- The medical billing service should assume full responsibility for timely filing issues and pay the practice the allowed amount for any claims they fail to submit prior to the timely filing deadline. This eliminates the risk a practice has when the billing is done by in-house billers who will never provide such a guarantee.
- 24/7 access to the medical billing system so that full transparency exists between the practice and the medical billing company.
We often hear from the physicians how hard and long they work for ever decreasing reimbursements. All this is true. However, too often we also see practices (through various reasons) hurt themselves financially - over and over again.
It has been said that the definition of insanity is doing things the same way and expecting different results. This certainly applies in the story outlined above. The biller that left $40,000 in charges unbilled will likely continue to cost the practice money. Just because she works for the practice does not mean she represents their best medical billing solution.
A high performing medical billing company with complete transparency and full alignment of incentives is the surest path to medical billing excellence and strong financial performance for your practice.
Copyright 2008 by Carl Mays II - 15246
The average medical billing company's fee is a percentage of the practice's collections. As a result of this their compensation is directly proportional to to how much money they collect for your. In stark contrast to this are internal medical billing employees that are paid on an hourly basis. They are paid because they are at their desk, not because money is flowing into the practice's bank account.
This issue, however, is often not fully understood or appreciated by many providers. These providers frequently say: "the staff works directly for me in my office-- they are more loyal and will do a better job and I can see what they are doing". Experience has shown, however, that this is often not true.
In a recent meeting with a multi-physician provider practice I was told a tale that I have heard many times before. One of the offices multiple medical billers was out for a few days. While she was out her supervisor was looking through the billers desk for some information that was needed. What she found was over $40,000 worth of old claims that the biller had stuck in her bottom drawer and never billed. As if this was not bad enough, almost all of the claims were beyond the timely filing deadlines and the money was lost forever. When the medical biller was back in the office she was reprimanded for this horrendous error. She was not terminated - she kept her job despite the fact the office lost thousands of dollars because of this horrific medical billing performance.
Why wasn't more severe action taken? Because of concerns with upsetting the billing staff and exacerbating a staffing problem that existed. The biller was moved from follow-up to the front desk where she is now being trusted to collect the critical demographic information required to properly bill claims.
This volume of missing charges should not have gone unnoticed. There should have been multiple reports that could have identified such a problem. The practice, unfortunately, did not know how to properly utilize the capabilities of the billing system and so, the required reports were never run. Proper use of a billing system requires much investment in time and training, an investment that hourly employees often do not make. This $40,000 in unbilled charges is likely a proverbial roach of this practice - in other words, for the one you see there are likely hundreds you do not.
Utilizing a medical billing company is not a panacea for such situations, but if you insure the following actions are built into your agreement with the billing service, you should be in good shape:
- A fully integrated tracking system (charges by locations/provider and payments by source - lock box, office, PO Box) should be in place and you should have full visibility into the system at all times.
- The medical billing service should assume full responsibility for timely filing issues and pay the practice the allowed amount for any claims they fail to submit prior to the timely filing deadline. This eliminates the risk a practice has when the billing is done by in-house billers who will never provide such a guarantee.
- 24/7 access to the medical billing system so that full transparency exists between the practice and the medical billing company.
We often hear from the physicians how hard and long they work for ever decreasing reimbursements. All this is true. However, too often we also see practices (through various reasons) hurt themselves financially - over and over again.
It has been said that the definition of insanity is doing things the same way and expecting different results. This certainly applies in the story outlined above. The biller that left $40,000 in charges unbilled will likely continue to cost the practice money. Just because she works for the practice does not mean she represents their best medical billing solution.
A high performing medical billing company with complete transparency and full alignment of incentives is the surest path to medical billing excellence and strong financial performance for your practice.
Copyright 2008 by Carl Mays II - 15246
About the Author:
Carl Mays II, President and Chairman of ClaimCare Medical Billing Services, is an expert in the field of medical billing and medical practice management. Carl has been working in the medical field for more than 12 years. Prior to that Carl worked as an aeronautical engineer for Boeing. Read more about medical billing companies at the ClaimCare Blog.
