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Four Costly Misconceptions About In-House Billing

Learn to recognize misconceptions about billing that may be starving your office of efficiencies. Read the list and see if you can improve.

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5 min read
March 21, 2013
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billing misconceptions

Billing is a crucial aspect of running your practice. However, you may be doing a disservice to your business by keeping your billing in-house. Now, before your say, “hogwash!” and list the perceived benefits, let me tell you that those benefits might actually be misconceptions. Let’s tackle ‘em.

Misconception #1: You’ll have more control over your billing.
Proximity does not equal effective control. Just because a biller is inside your clinic doesn’t mean you have the time to supervise them. You’re treating patients, and everyone else in your practice has responsibilities, too. Managing an in-house biller means you’re also managing your entire revenue cycle. That’s a whole lot of extra (and not fun) work—a burdensome amount that you can easily shove onto the back burner—meaning you can shirk that task.

A professional off-site billing service actually offers you more control with less time-consuming responsibility. These services offer complete transparency and dedicated specialists (or account managers). Plus, the service should auto-generate at-a-glance reports for you, so keeping an eye on your revenue cycle is actually that—just an eye, not your entire self.

Misconception #2: Your current staff can handle your billing.
According to the MGMA’s 2009 “Practice Perspectives on Patient Payments” research, 23.2 percent of total patient services revenue (accounts receivable) is attributed to collections from patients—and that’s an increase over previous years. Additionally, according to the Center for Policy Research, the number of high deductible health plans and accompanying health savings accounts have more than doubled in the past four years.

What does this mean for your billing? More time spent on sending patient statements, handling patient billing questions, establishing payment plans, and following up on late or missed payments. Tack all that onto managing the rest of the billing process, while keeping up with the ever-growing complexities of government regulations, third-party carrier changes, and technology in general. Want to do all that in-house? Then you’re looking at one additional employee at least.

However, when you outsource your billing and revenue management, you and your staff needn’t worry about the hot mess of to-dos above. Again, you’ll have more time to focus on patient care. And you’ll have an entire team of billers working for you without needing to shell out all the dough associated with hiring another employee.

Misconception #3: Keeping billing in-house is more cost-effective.
An experienced medical biller isn’t the only requirement for in-house billing. You also need software. And both are critical to the success of your practice. If you hire your own biller and purchase a do-it-yourself medical billing software, you’re looking at about $65,00 in payroll and software fees—not to mention benefits, 401k, training, sick days, vacation, and turnover. Plus, labor hours might prove higher because, without a billing software that integrates with your documentation tool, your biller is going to devote time to double data entry. I’m not hearing any bang out for your buck.

But if you outsource your billing, you may find you’re saving money. I’m talking thousands on payroll taxes alone. Additionally, most billing services are pay-for-performance. If you don’t get paid, they don’t get paid. In-house, though, your payroll most likely runs the same time each month regardless of the performance of your biller. Plus, if you chose a billing service that fully integrates with your documentation, then there’s no double data entry and that means reduced errors.

Misconception #4: You can handle your billing in addition to seeing patients.
I touched on this point in the first misconception. Proximity does not equal effective control, and let’s not even think about possibly tackling all this by yourself. In-house billing involves a lot of time, money, and energy. You shouldn’t be expending all that on billing. After all, you have patients to treat. And that begs the biggest question here: Why do the billing yourself? If you’re a clinic owner, you most likely don’t do your own business taxes, answer your own phones, or schedule your own appointments. You’re a small business, sure, but you’re not a one-person show.

You started your practice to take care of patients, not fight with insurance companies and resolve billing issues with patients. Relinquishing control is scary, but with the right partner, you’ll breathe easy as soon as you make the transition to outsourcing. More than breathing easy, you’ll find lots more time to focus on what matters.


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