"Based on median values, the practices that outsourced had improved collection percentage, higher charge per visit, higher payment per visit, lower office expense, and a more productive staff." - Chuck Felder
In-house or Outsource?
To help you decide whether to outsource or retain billing and collections in-house, ask yourself the following questions:
- Are you willing to dedicate staff to billing and collections exclusively? Many practices assign billing and collections duties to current staff, often the front desk personnel, who also have to answer the phone, schedule patients, and cover for other staff members. Your staffing model will indicate the priority you are assigning to billing and collections.
- Are your staff entering charges, filing insurance, and posting payments every day?
- Are denials being followed every day, with feedback to clinicians and practice owners regarding non-covered codes?
- Are you auditing to ensure that insurance companies are paying according to your contracts?
- Is there consistent follow-up on unpaid claims?
- Can your staff demonstrate the percentage of money after adjustment by insurance contracts, collected each month? What is the average number of days to collect that money? What percentage of average monthly charges is outstanding in your accounts receivable? Do staff formally report these benchmarks to you each month?
- Do you have stable staff, experienced in collecting rehabilitation codes? Is there a contingency plan if your in-house biller resigns?
- Do you have a practice management system that is robust enough to manage the frequent regulatory changes?
- Is your staff trained in the Fair Debt Collection Act? Are your patient data being transmitted according to the security requirements in the Health Information Technology for Clinical and Economic Health Act, Public Law 111-50 (HI-TECH)?
If you answered yes to these questions and you are meeting the industry standards and timelines for collecting revenue, you may be successful with in-house billing. The final consideration is what it costs you to perform these functions. In calculating your fixed costs, be certain to include office space that would otherwise be used to generate revenue or be eliminated to reduce overhead, billing staff salaries and benefits, insurance, office supplies, phone, postage, and additional computers and software.
Your time as a revenue-producing, practice-building entrepreneur must also be considered. If you are continually involved in billing office issues, then your costs should be included. Compare these costs with the percentage billing companies charge.
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