A Guide to Outsourcing Medical Billing
Determining the Right Time
Engaging a billing partner rather than handling claims and collections in-house has become increasingly popular among medical practices. In large part, this is due to the challenges of maintaining expert staff and the ever-changing requirements and rules set forth by insurance companies.
The Challenges of In-House Billing
Many healthcare providers have maintained in-house billing because they believe they have greater control over their finances. However, compliance issues, coding errors, staffing and office space limitations, and hardware and software requirements can create debilitating inefficiencies and negatively impact profitability. To optimize financial performance, a medical practice needs a team dedicated to billing activities and the space and equipment to manage those processes accurately.
Research shows that at least 60 percent of healthcare providers spend an average of a full working day each week on billing-related tasks. That means 52 days a year that could’ve been invested in patient care and practice growth. Personnel management also requires a substantial investment of time and money to ensure proper oversight of medical billing activities.
When medical billing activities are managed in-house, physical office space must be allocated for staff and the equipment necessary to perform these activities. Because office space is at a premium, often in-house billing managers must share space with and be distracted by other team members, taking focus away from the financials.
Even when a medical claim is submitted correctly, there is a delay imposed by the insurance companies before payment is received. This can range on average from 15 to 20 days for electronically submitted claims, and 30 to 45 days for claims submitted on paper. The time frame increases if claims must be resubmitted for accuracy. This lag makes it difficult to predict revenue and cash flow for the practice.
The cost of finding and retaining quality team members is on the rise, and handling medical billing activities requires both experience and focus. To effectively manage the revenue cycle for a practice, the finance team must be highly trained in both medical billing and coding and not distracted by other tasks. Most medical billing experts do not have similar expertise in coding. If a team member leaves for another opportunity, your medical billing activities receive no attention until you’ve hired and trained a replacement. These gaps in billing management and experience can have devastating financial consequences for a practice.
HR Footprint & Overhead
As your practice grows, you must scale with that growth by adding more staff and resources, such as space and equipment. You also must invest in compliance, training and education to ensure your team is utilizing the latest medical billing procedures and coding practices.
Writing Off Claims
Sometimes the extraordinary time required to collect small balances from insurance companies, particularly if there are medical coding issues and resubmission’s, can appear to be an untenable investment. The practice opts to write off the claim, and then writes off another and another. Little by little, these seemingly minor losses can have a major effect on profitability. Payment reconciliation is also a key part of the collections process; if not handled with diligence and accuracy, poor reconciliation can compound the problem. Chronic write-offs create a domino effect, and eventually those losses can account for as much as 30 percent of the total collections for a practice.
If your practice has experienced even one of the aforementioned challenges, now is the right time to engage a medical billing partner.
The Benefits of a Billing Partner
When you engage the right medical billing partner for your practice, you can restore some sanity to your staff and yourself. The right partner should be able to offer you certain promises; without those commitments, you won’t be guaranteed improvement.
An Extension of Your Practice
The right medical biller should be your partner, working behind the scenes quickly and quietly to accomplish the tasks at hand. This means less time spent on billing-related tasks by you and your staff and more time to focus on delivery of patient care. Because of the contracted relationship with a billing partner and the accountability inherently tied to it, your practice can reduce its risk of embezzlement by staff while stabilizing revenue. The right biller will link your success with theirs, such that there is a financial incentive integrated into the partnership to motivate the biller to collect every available cent for you.
The right billing partner has a dedicated team of experts who stay updated on the everchanging insurance landscape, with leading-edge training on coding requirements and collections procedures. Less billing errors means more efficient reimbursements. This team is also focused only on your revenue cycle and because they work away from your office, they are immune to the distractions and interruptions in a typical practice environment, like patient emergencies, visits from sales representatives, and the general day-to-day activities of a busy office. A medical billing partner with the right technology and a complementary commitment to advancing innovation will reduce stress and hassle while providing improved financial outcomes to your practice.
HR Pressures Relieved
In addition to optimizing revenue, the right medical billing partner can alleviate human resource pressures and reduce your practice’s personnel footprint, which typically results in immediate savings. The cost to employ a full-time billing manager isn’t limited to salary; that team member typically receives additional benefits which can add up to 30 percent more than just the base salary. Assume that same team member will be absent for vacation or sick leave at least three weeks of the year, and that’s lost productivity for your practice. The right billing partner deploys an entire team to your account and has redundancy to accommodate for any absences on the assigned team.
Finally, the right medical billing partner can free you of financial worries through special financing opportunities secured by your account. For example, Nobility is the only RCM provider to offer Pre-Funding. With this model offered exclusively to qualifying clients, the company pays the practice’s claims upfront and then collects from the insurance companies on the practice’s behalf. Pre-Funding enables the provider to have 100% predictable revenue, which, in turn, creates true financial freedom, now and in the future.
Choosing the Right Billing Partner
When you decide it’s time to identify a medical billing partner or make a change to your current service, the options can seem endless and overwhelming. But a “one size fits all” or “flat rate” solution rarely leads to ideal outcomes because practices are unique, billing needs can be sensitive, and providers have diverse priorities influenced by the practice’s size, scope and stage of its own life cycle.
Before considering a new medical billing partner, research is essential. Plenty of medical billing companies will promise “too good to be true” results, but if they can’t deliver, your financial health can be compromised and you will become rapidly disenchanted by the experience. Taking a few critical steps can help to ensure the process is productive and the final selection is one that benefits all parties involved.
Communicate your Goals
The best way for a medical billing partner to customize its solution for your practice is to first understand your specific goals and objectives. What kind of HR footprint does your practice have? What elements of the medical billing process challenge you most? What are you ultimately wanting to accomplish with your billing partner?
A medical billing partner should be a natural extension of your practice. When assessing if a billing partner is the right fit for your existing staff and your specific needs, you can get a much better sense of how your respective organizations will interface by opening the lines of communication to all stakeholders on the front end. This dialogue enables you to find out what the billing partner’s contingency plans might be to ensure there’s no disruption to the work on your account, get a preliminary glance into the communication style of the billing partner, and gain intelligence on other tangible and intangible dynamics.
Your peers often face the same challenges as you, so if they are satisfied – or better yet, ecstatic – with their billing partner, this partner may provide services that also align with your goals. But it’s not enough to simply ask for the name of a company; the most important question you can ask is, “Why are you recommending this medical billing partner?” Putting the “why” behind the endorsement gives you context and proof of performance.
Require Evidence of Performance
Financial stability is a crucial factor because the medical billing partner you choose will be managing your revenue. If the biller isn’t financial healthy, it stands to reason that the service it provides to you won’t improve your financial position either. Billing partners able to demonstrate a long-term commitment to remaining in the market will promote continuity for your practice, and those that can produce data to showcase performance – essentially “walking the talk” – will likely be a stronger and more valued partner for you, now and in the future.
Though the process can be time-consuming, undergoing a diligent and thoughtful assessment of a prospective medical billing partner is a worthy investment. Taking an investigative approach is the best measure to ensure your partnership is successful.
100% Predictable Revenue with Pre-Funding
Nobility clients have exclusive access to Pre-Funding, an option that ensures guaranteed revenue for healthcare organizations.
We pay your practice’s claims upfront and then collect from the insurance companies on your behalf, giving you access to ready capital alongside an all-inclusive billing solution to optimize revenues and efficiencies.
The Pre-Funding Process
Our team performs a free coding and billing analysis to rate reimbursement performance and determine if your practice is a candidate for Pre-Funding.
We evaluate the current AR and past production of your practice to set the PreFunding amount
If the analysis and assessment lead to an approval, you are invited to apply for Pre-Funding and a revenue payment schedule is provided to stabilize your cash flow.
Are you ready to focus on your patients and let a medical billing partner focus on your bottom line?
Nobility offers a free, no-obligation assessment of your practice’s current billing activities to develop customized solutions according to your needs.
For medical practices, visit www.NobilityRCM.com.
7465 E. Osborn Rd Scottsdale, AZ 85251