Of the many business challenges facing healthcare providers today, choosing between outsourcing medical billing services or maintaining an in-house billing department is critical.
There’s no true one-size-fits-all approach for practices. A variety of factors can influence the decision, including costs and staffing availability. But because your cash flow depends on billing, the decision on how to handle these services shouldn’t be ignored.
While many practices can handle billing services on their own, there may be warning signs suggesting it’s time for you to consider outsourcing. Today, we build on previous articles by providing you with these warning sings and how to remedy them.
Too Many Billing Errors
According to MGMA, your practice isn’t doing well if your denial rate is over 4%. And because the average claim denial can cost $25 to $30 each, doing it yourself may not be your best bet. Outsourcing, then, becomes an efficient alternative.
When outsourcing, you don’t incur any of the costs associated with finding errors and resubmittal because the billing company is charged with handling these expenses itself.
Your billing service is contractually obligated to perform certain services for you, including appealing denials to a certain level of success. Plus, you never have to worry about staffing, since it’s their job to provide support year-round.
Medical billing departments can also be sources of embezzlement, and employee neglect often leads to issues if managers don’t keep a rigorous eye on billing operations. A third-party medical billing company assumes all liability, thereby preventing you from running into legal problems caused by careless employees down the road.
Physician practices normally delegate dedicated staff members to manage their day-to-day administrative, billing, and operational needs.
But according to the Patient Profitability Index, a 5,000 physician survey, the burden created by tasks like coding and billing are habitually falling on the shoulders of physicians. Sadly, this comes at the expense of patient care.
When asked how much of time was spent on administrative tasks rather than patient care, 59% of physicians admit they sacrifice more than 20% of their time on paperwork. That’s equivalent to one full day per week spent at a desk rather than in an exam room.
The path to payment is flooded with printing, phone calls, back-and-forth with insurers and many other arduous administrative tasks. Outsourcing medical billing takes the headache out of running a profitable practice and enables you to scratch off time-consuming busy work that takes up time you could’ve spent on more productive activities, e.g., seeing patients.
Not Ready For ICD-10
On average, the American Health Management Association estimates coders will need to focus 16 hours of training on ICD-10-CM, 24 hours on ICD-10-PCS, and at least another 10 hours on practice implementations.
So if you haven’t made preparations for ICD-10 and don’t have the time to train your staff in the next 35 days, it may be a good idea to outsource your billing to a company that’s prepared to handle the anticipated 55,000 new codes.
In case you’re considering hiring a certified ICD-10 coder to cover in-house billing duties, keep in mind the average professional coder salary ranges in the $40,000s, not including benefits. It may be cheaper to go with an outsourced billing company, as most only charge a small commission rate on paid claims.
As we’ve mentioned earlier, the decision to outsource varies from practice to practice, depending on a variety of factors. Weigh your options carefully.
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