When it comes to billing, medical practices can choose to outsource or take care of it in-house. To select the best option, review the features and benefits of each method:
Medical Billing Services
When you opt for outsourcing, your staff will forward bills and other financial documents to a medical billing service provider. According to The Profitable Practice, once the service receives your paperwork, the company will manage your claim submissions, tracking and basic data entry tasks. Typically, you’ll pay a medical billing company a percentage of the amount that they collect. Currently, the industry average is around 7 percent.
Medical Billing Software
Traditionally with medical billing software, you’d have a software installed locally that to manage your practice’s finances. Cloud-based medical billing software is becoming more prominent and is also a viable option. In most cases, medical practices only require basic billing software, but if your system is outdated, you may consider upgrading to a billing management program. The extended framework includes features that will help you manage your entire facility. Features include using it for scheduling, storing electronic medical records and assessing imaging.
How They Differ
Because billing can be time consuming and emotionally challenging, you may prefer to outsource. Medical billing service companies follow up on rejected insurance claims, and they will contact patients regarding delinquent accounts. This type of service is set up to send invoices to your patients. If your practice is short-staffed, then a service provider may be more helpful than in-house software since outsourcing decreases the amount of labor needed to operate your facility. A major benefit to choosing a medical billing service provider is the convenience that it offers.
Medical billing companies may provide better transparency. If you select this type of service, make sure that the company supplies detailed performance reports upon request. This will let you review your billing operations. Outsourcing ensures that you will have access to a billing staff at all times. The service also delivers operational consistency as most companies agree to perform a specific set of services. One of the downsides to outsourcing is its variable cost. This feature delivers budgeting challenges since the company’s fees will change every month. Also, outsourcing may include extra fees. Before contracting with a billing service provider, confirm their exact pricing structure. In addition, you will need to hand over billing control to another entity.
By choosing in-house software, you’ll be retaining complete control of your practice’s operations, which provides peace of mind. Once you’ve paid for medical billing training and the processing software, you’ll have a better return on your investment. If problems arise, then you’ll have immediate access to your records. With in-house billing software, you can quickly address any administrative issues.
One of the drawbacks to in-house billing is the cost. The additional salaries and expenses for employee benefits are likely to increase your practice’s overhead. Billing technology systems can be pricey, and cash flow problems may arise when you have a small staff of one or two billers. If one of your employees becomes sick, takes a vacation or quits, then you’ll be facing retraining expenses for a new employee as well as a potentially stalled billing department in the interim.
Billing management can be a tough choice since service providers and in-house software offer advantages and disadvantages. When making the decision, consider the size, age and needs of your practice. For instance, if you’re just getting started, it may make more financial sense to outsource. If your practice is established with a billing system in place, then a system upgrade may be all that you need.