How Much Do Medical Billing Services Cost?
It is absolutely crucial that medical practices have effective and organized billing operations. Healthcare is (and should be) the top priority, but a medical practice is still a business that needs to turn a profit in order to stay open. Medical billing is complicated and time-consuming, requiring you to devote staff hours to processing claims and payments. And, with your staff worried about other procedures and tasks that have nothing to do with billing, mistakes can be made and things can go wrong. That's why many medical facilities outsource the task to a medical billing service, leaving the process in the hands of dedicated professionals and freeing their own staff to focus on the patient.
What Is a Medical Billing Service?
Hiring a medical billing service takes the weight of every aspect of the billing cycle off your shoulders. A billing service handles everything for you, including confirmation of insurance eligibility and coverage, patient registration, claim preparation, payment submissions, and verification that payments have been made on time. They field phone calls from insurance companies and patients, making sure to check any payments received against the payer's bill and contacting them when a payment has not been made in a timely manner.
Medical billing services also provide comprehensive reports at set intervals, including accounts receivable, charges billed, claims denied, and revenue collected. Most billing services will tailor what they offer to a provider's specific needs, so it is a good idea to request proposals from multiple companies to understand your options.
In-House vs. Outsourced Medical Billing
There is no way to run a medical practice without a billing component, but it can be difficult to figure out how to balance your billing with the rest of your workload. It is often best to leave that aspect of your facility in the hands of a third-party company to allow you and your staff to focus on the medical aspect of your jobs. But in figuring out whether it is worthwhile to do so, you also need to consider your monthly billing amount, the size of your practice, and how your staff is utilized. Smaller facilities may find it easier to outsource these operations, while larger ones may have the budget and staff to keep operations in-house. But remember that keeping your billing operations in-house requires you to keep a certified medical coder on hand that must keep up-to-date with the constantly changing medical codes and laws. Outsourcing to a medical billing service, however, leaves that responsibility entirely up to professionals that focus only on the billing aspect of your practice.
Cost does factor into deciding if hiring a medical billing service is the right choice for you, but it is not the only factor. Just because you can afford to have your own staff take care of the billing process does not mean that they should. There is a larger chance for billing errors to occur when on-site staff are taking care of the billing than with a dedicated service.
Additional Benefits of a Billing Service
There are numerous benefits that come with hiring a medical billing service.
- No longer need to become involved in negotiations between patients and insurance companies
- Fewer tasks for an already overworked staff
- Greater peace of mind that your practice's finances are being professionally handled
- Increased efficiency
- Faster claims processing and increased revenue
- Lower overhead costs
How Much Does Medical Billing Cost?
There are two main ways that medical billing services charge: by taking a flat fee per claim or by taking a percentage of collections. Companies that take a flat fee typically charge between $1 and $8 per claim, with the average coming in at around $5 per claim. Before deciding on a company with this payment model, it is important to know if they separate the costs of submitting inpatient and outpatient claims.
Some billing services charge a percentage of collections. These firms typically take between 5 and 10 percent, though it should be noted that rates can be as high as 15 percent. While that may seem high, it can actually be quite the earning incentive, as the service does not get their money unless you get yours.
Remember that different vendors will charge different prices and have different features and tasks included in their packages, so you need to make sure that you receive a full breakdown of all the associated costs. In addition, ask for references and read all available reviews of a service before making a final purchasing decision. Just because one service charges more than another does not mean that they will cost more in the long run; a billing service that performs well can increase your revenue and make up for the higher rate.