Medical billing is a complex process that involves multiple levels of healthcare staff across an organization, from physicians to coders to Accounts Receivable departments. On a daily basis, these individuals must translate patient care episodes into claims to send to insurance companies for reimbursement. However, submitting and receiving claims can take weeks or months to complete, and insurance companies may not pay what the healthcare organization hoped for. An ongoing cycle of these types of occurrences can create financial setbacks for hospitals and providers, resulting in higher cost of care and increasing levels of bad debt. These developments in the recent history of healthcare are troubling, especially as healthcare continues to be a battleground topic in the United States government. That’s why many healthcare providers and clinical staff are investigating better ways to perform their billing tasks. For many, this includes considering and vetting third-party billing agencies to which they can outsource work for a cheaper and more effective cost than they are currently working with.
What Is Medical Billing Outsourcing?
Medical billing and coding is an in-depth process that often benefits from skilled knowledge of and experience in communicating with insurance payers. It can involve a variety of staff, from dedicated coders and accountants to part-time or temp workers to physicians and their assistants. However, because billing workloads can sometimes be rather heavy, outsourcing the work to a third-party billing company can be an attractive option for many. These companies help by partnering with clinical staff and dedicating time and manpower to assisting with healthcare reimbursement.
Coding and billing are both highly delicate and detailed tasks, and errors are easier to make that one might think. Unfortunately, the more errors that appear, the less likely an insurance payer is to reimburse in full or reimburse at all. If insurance denies a claim or only pays part, the rest of the cost falls on the healthcare organization itself or on the patient. This process is complicated even further by the fact that healthcare business models and staffing levels are not uniform, so billing work is not one-size-fits-all. As a result, creating an effective revenue cycle can be difficult.
For many organizations, a solution to this problem is to outsource work to the aforementioned third-party medical accounting firms. Partnering with an organization like this can result in a number of advantages for clinical staff members. However, despite the many advantages to medical billing outsourcing, integrating an external team may seem intimidating or confusing.
Top Medical Billing Outsourcing Worries
Many clinical staff members are hesitant to involve an outside company with their finances. Some of their worries are as follows.
Difficulty With Trust
Sometimes, organizations fear that trusting a third party to help them with their finances could end up costing more money and that they may be slow to provide solutions to reimbursement failures and insurance claim denials. These concerns are valid, and a reputable medical billing outsourcing company will do their best to communicate with you every step of the way. Transparency and accountability are essential qualities that a healthcare billing outsourcing company must possess and display to a hospital or other medical organization on a daily basis.
Will It Actually Save Money?
Because the greatest concern of all when considering outsourcing is how much it will cost, some leaders in charge of deciding whether to take this step have doubts about whether they will actually save money in the long run. After all, using proprietary labor is often cheaper than hiring an outside company to do work for you. Third-party medical billing companies must also therefore prove that the value they provide is worth the investment.
Doubt About Third-Party Fees & Costs
An additional cost vs. value concern that may appear is the question of how fees are presented. Will the outsourcing company charge a flat rate and no more for their work, or will they charge extra for certain services? Will there be hidden costs or will all costs be presented to the healthcare organization in a fair, well-communicated manner?
As a result of these concerns, many providers continue to believe that they should simply keep their billing process in-house. And yet, there are still good arguments for why this work should be outsourced. If this topic interests you, read more about the outsourcing argument here.
Advantages To Outsourcing Medical Billing Services
Many healthcare organizations outsource their billing work because it can be a perfectly viable solution to the major need of improving cash flow and reimbursement rates. The right partner will be willing to work and communicate with you to make the most of your relationship. When this occurs fluidly, an incredibly rewarding experience can result. There are many advantages to this, and you can read more about them here.
Save Time and Resources
Outsourcing your A/R work to a skilled, trustworthy medical billing company can significantly lower the cost of creating and submitting claims. Properly performing billing and coding tasks takes a significant amount of time and training, which means it also costs a good deal of money. But what’s your healthcare organization to do if the people it hires to do this work are only part-time or temporary workers? What if billing isn’t their only job and they have other unrelated duties to perform that divide their attention? And what if turnover is high for work like this? Your organization will likely end up with a fragmented billing process that doesn’t work efficiently and that effectively costs you more time and money to maintain.
Outsourcing to a third party billing company can help alleviate some of this risk and cost. People who work for companies like this are usually well-trained by their company and stay up-to-date on industry trends and changes. Not only that, they often work in close-knit teams that are capable of working together to swiftly submit accurate claims, close unpaid and legacy accounts and create an efficient workflow that saves money and brings in more revenue for your organization and theirs alike.
A quality billing outsourcing company will be willing to openly communicate with your clinical staff. Trust in this industry is built on transparency, and a third party medical billing company will do its best to keep you apprised of their success rate and the techniques they’re using to streamline the process. Also, if they’re doing what you hired them to do, your organization should be able to see the difference in its operating costs and in the increased cash flow coming in.
Stay Up to Date
As the healthcare industry evolves, so do billing processes and regulations. Many factors change the billing environment, including: adoption and adaptation of new reimbursement models, updates to medical coding standards and insurance payers’ and government entities’ adoption of new practices. A quality medical billing outsourcing company will take a vested interest in staying educated about changes as they occur, and will work to best utilize their talents and skills in service of your organization. As a result, your organization will benefit from their consistency and attention to detail.
Gain More Control of the Process
One big concern for many healthcare organizations about the possibility of outsourcing their medical billing process is the level of risk involved. Some providers and billing staff may feel as though letting a separate entity do much of the required work takes control of the work out of their hands. However, many organizations and people in leadership positions who integrate outsourcing actually find that they feel a greater sense of control over the process than before. With regular communication and reports from the third party company, they’re able to see a much bigger picture of their accounts and billing outcomes than before. This can result in higher levels of confidence and an ability to further plan out an effective revenue cycle management system.
Focus On Patient Satisfaction and the Goals of the Organization
Hiring a third-party organization to help your billing department can also help your entire clinical staff focus less on reimbursement issues and more on creating a positive healing environment for patients and staff members alike. Once the medical billing company that you partner with starts helping you save time and bring in more cash, you’ll also have more time to focus on other goals that help create positive outcomes for you and your patients. The details of the billing process are important, and most clinical environments have people trained to handle them. However, outsourcing billing work can help all of your staff focus more on the people they serve and the overall health of the organization.
How Can A Revenue Cycle Management Vendor Impact Cash Flow?
The financial decision of hiring a third party medical billing firm for your medical practice is obviously one that requires a great deal of research and vetting. Again, it may seem odd that hiring a separate company to help you with billing and A/R tasks wouldn’t actually increase your cash on hand, but if done correctly, that’s exactly what can happen.
Billing companies take a certain percentage of the money that they bring in for your organization, but the advantage of having them is that their main purpose is to bring in more money for your organization than you’re accustomed to. So even with deferring a small percentage of those funds, you’ll still end up receiving more revenue, or, at the very least, not shouldering more debt. This is all possible because a skilled medical billing company can work with insurance payers to submit clean claims and increase claim approval rates. Even if it doesn’t seem like hiring an organization to help increase revenue intake will be cost-effective, in the long run, it definitely can be. You can learn more about a medical billing company’s impact on your cash flow here.
Questions To Ask Your Medical Biller
When researching and vetting a medical billing company, there are several big questions that you can ask that will help determine if the service they offer is right for you.
How Quickly Can They Begin Processing Claims?
Many healthcare organizations have immediate financial needs that a billing company can help solve, so it’s vital that you find out what their timeline is for beginning to work with you. You’ll also want to find out how long it takes for them to undergo the whole claims process with insurance payers and how often they follow up on claims, because speed is of the essence where getting paid for medical services is concerned.
What Services Do They Provide?
Since each medical billing firm has its own structure and way of working with its clients, you should ask what services and benefits your organization will receive from working with them. What kinds of reporting do they do, and how involved in the process do they get?
What Training Does Their Staff Receive?
For a medical billing company to be successful, it has to offer the right kind of training to its employees. What techniques do they use for creating and submitting claims, and how good are they at compliance with regulations like HIPAA? Do they offer more training and stay more up-to-date on changes in the industry than your workers?
Who Will Handle Accounts Receivable?
You’ll want to establish early on what kind of relationship you want to have with your outsourcing company. Do they want to take on your full workload or just help out where you need them to? Will they defer to your preference? How do they handle A/R work, and how will their team communicate and integrate with your existing staff?
Will They Provide Regular Reports?
Communication is the key to trust between a healthcare organization and its medical billing outsourcing company. And in order for your organization to work toward a healthier revenue cycle, it will need all the data it can get to create plans and reports. Therefore, your outsourcing company should be able to give you regular updates on cash flow and how quickly they are closing accounts so you can get a big picture view of the process.
The DECO Difference
We are a revenue cycle management (RCM) company that partners with many healthcare organizations to improve their billing processes and improve their financial performance. Not only do we work alongside your staff to improve cycle times and help close accounts, we also work with great compassion to capture patient information while they are in your facility. By doing this, we are able to obtain accurate data that can help in the claims process. We actively seek out ways to help patients find coverage so we can help you submit clean claims and stop eating the cost of the care you provide. And we work with a high level of communication with your team, with boots on the ground so that you can rest assured that we have your best interests at heart and are doing everything we can to help your revenue cycle succeed. If you’d like more information on this topic, visit our other articles and contact us today!