Outsourcing Medical Billing

Mon, 10 May 2021 16:48:38 GMT

Medical billing is the most important aspect of running a successful practice, and outsourcing can help you collect more revenue. Even if you have a highly skilled office manager and medical billing personnel, you are likely to have some inefficiencies in your medical billing that result in lower overall collections when you undertake in-house medical billing.

Finding and maintaining experienced billing employees to handle medical billing and collections has become challenging and costly for some small and independent practices; therefore, outsourcing your medical billing for a greater ROI is a preferable alternative. Many physicians are opting to outsource their medical billing these days in order to eliminate the administrative strain and overhead involved with the billing process. Outsourced billing can result in a 7-10% improvement in net collections as well as a better patient and provider experience for practices.

If you're not sure whether you need to outsource medical billing, the checklist below will help you make an informed decision.

• Is your percent of accounts receivable over 120 days greater than 15%?

• Are you seeing the same, or an increased number, of patients but seeing a decline in revenue?

• Is your net collection rate declining?

• Do you experience a high rate of turnover with your in-house billing staff?

• Do you have difficulty finding qualified billing staff?

If your answer to any of the above questions is” Yes,” then you should outsource your medical billing.

Once you've decided to outsource, you'll need to decide what kind of billing company you need, such as light, full service, or boutique based on your service needs. While not all billing companies are the same, and services can vary greatly, it's critical to have responsibilities clearly defined in any contracts you sign.

ROI of Outsourcing Medical Billing

When it comes to measuring ROI, you need to determine the actual costs of your current billing process with the help of your fixed and variable costs.

Determine fixed cost with the following factors:

• Hourly wages of staff and payroll costs

• Employee benefits

• Billing software

• Workers’ compensation insurance and payroll taxes

• Clearinghouse fees

Determine variable cost with the following factors:

• Rise in rejections and denial rate

• Declining cash flow and net revenue

• Unplanned staff sick leave and vacations

• Stationary, postage, and statement fees

Apart from the above, you can use some indicators such as First Pass Resolution Rate (clean claim rate) to evaluate ROI for outsourcing your billing.

First Pass Resolution Rate

These metrics determine your capabilities for follow-up claims that are not paid the first time.

• The number of claims paid by the payer upon the adjudication.

• Target: >95%

• Calculation: (Total Number Claims Submitted - Number Denied Claims) / Total Number Claims Submitted

You can miss big profit margins if you consistently re-work a higher percentage of claims or you process outstanding AR as denials. It’s essential to look at the number of “days in AR” and your “net collections” together.

Days in AR

• The number of days that charges are outstanding.

• Target:<30 days

• Calculation: (Total Receivables - Credit Balances) / Average Daily Gross Charge Amount) *Average Daily Gross Charge Amount - Total Annual Gross

Charges / 365

Net Collections

• The total amount you were potentially due from payers and patients was collected after excluding contractual adjustments.

• Target: >95%

• Calculation: (Total Charges - Payer Disallowed Amount) / Total Payments)

These two KPIs are important, and knowing them will help to determine whether you are achieving your ROI promised by the billing partner is realistic or not. If you are looking to optimize the ROI from outsourcing medical billing, we are here to provide solutions.

Optimize Your Revenue Cycle

Mon, 01 Mar 2021 17:42:45 GMT

Optimization of your revenue cycle creates an opportunity to make your practice more manageable and increase your revenue. Although medical billing can be overwhelming, knowing what processes will have the most impact on your practice is vital.

Here are a few important tips that will boost your efficiency and will make medical billing easier:

Patient Demographics and Documentation

It's best practice to ask for a patient's insurance card and government-issued ID card during the check-in process. It will enable your practice to capture all required details about patients, e.g., correct name (no spell mistakes), address, contact number, date of birth, marital status, SSN, employer details, and necessary insurance information. Obtaining accurate patient information can save your medical billers a lot of time and decrease the amount of time it takes to receive reimbursement for services.

Eligibility Verification

Eligibility Verification is one of the most important ways you can optimize your revenue cycle. Knowing that the patient’s insurance is valid and their treatment is covered is the first step. If treatment is administered without taking this step, you may never be paid for services rendered.

It is best practice to complete verification before the date of service. This allows the physician's office to confirm insurance coverage and inform the patient of possible cost-share prior to their appointment.

Some insurance companies offer this service online, making it easy to verify coverage, while others require you to call them to get information. Verifying coverage before each patient's visit is not always practical to your staff. At a minimum, you need to be sure to know benefits before the first patient visit and re-validate at the start of the year when most coverage renews. We at Healthy Rev have a streamlined insurance verification process that enables our clients to know whether they will get payment from payers or patients.

Prior Authorization

Prior authorization (PA) is an essential part of the revenue cycle. If the procedures or medication are not pre-authorized by the payer, the claim will rarely be paid. It’s very important that procedures are in place for PA best practices to ensure maximum and timely reimbursement for services. Unsanctioned procedures, incomplete documentation and missing patient information can all result in unapproved PA.

On-time claim submission

Many payers have submission requirements, such as requiring claims to be submitted within a specific time frame, ranging from 30 days to 365 days from the service date. It’s good to file the claim on time to get paid faster. If you fail to file a claim within the time frame, claims will get denied, and your practice will not be reimbursed for the services you provided to the patient. Having a fixed billing schedule for your practice will ensure timely claim filing.

We at Healthy Rev take claim filing as a priority task, and we submit all claims as soon as we validate all the required information.

Medical Coding Audits

Every physician practice should ensure that they provide correct information on claims to save efforts, money, and a lot of hassle correcting denials. It is mandatory to use the correct CPT codes for the services you provided and keep up-to-date on changes to the codes.

Medical coding audits look to the past to improve the future. It is a way to ensure that submitted claims are done with a high degree of accuracy and quality.

This circles back around to coding optimization and denial management. Medical coding audits can help lower overhead by reducing the need for work to be done twice.

Creating a proper process to keep on top of the administrative requirements for error-free revenue cycle will help any practice achieve success.

Healthy Rev offers solutions for the revenue cycle to ensure less overhead and faster reimbursement so you can provide better care to your patients.

Contact Healthy Rev to learn how we can optimize your revenue cycle.

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Outsourcing Medical Billing

Optimize Your Revenue Cycle

Optimization of your revenue cycle creates an opportunity to make your practice more manageable and increase your revenue. Although medical billing can be overwhelming, knowing what processes will have the most impact on your practice is vital.