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10 Reasons to Outsource Medical Billing

10 Reasons to Outsource Medical Billing

Several years ago, based upon a thorough review of the facts, I recommended a client outsource his practice's billing. It was a peculiar conversation:

Me: You could successfully address a number of issues by outsourcing your billing.

Client: I learned in medical school that it is important to keep billing in-house.

Me: That may have been true at the time. Your current situation is different. Let's talk about it.

Client: I learned in medical school that it is important to keep billing in-house.

That old advice, based on who knows what set of facts, was as universal and unchanging for that physician as "Do no harm" or "When you hear hoof beats, think horses not zebras." Unquestioning loyalty to that premise cost him a lot of money.

Here are some of the benefits that can be achieved with outsourcing billing:

1. Free up office space

If the billing is outsourced, the biller does not need a place to sit and the billing records are somewhere else.

2. Make some employee turnover irrelevant

Make employee turnover in the billing department someone else's problem. Unless your practice is big enough to justify a billing department, with a set of employees with varying skills and levels of sophistication, high turnover is almost inevitable. Some billing work can be mind-numbingly dull and some requires sophisticated skills in analysis, synthesis, and communication. Very few people capable of these higher-level requirements will be satisfied for long with dull routine work.

3. Cut down on incoming phone calls

Office staff is relieved of calls that go directly to the billing service. The biggest benefit, however, is the calls that are never made because billing and claims errors are more often avoided in the first place.

4. Turn a fixed expense into a variable one

Staff and office space are fixed expenses. They cannot go below a certain level no matter how low the volume of billing is. When they go up, they go up in stair steps. If the practice is paying a percentage of collections for the billing service, there is a perfect correlation between collections and cost.

Another benefit is that the interests of the practice and the billing service are aligned. If the billing service increases collections and their rate is anything less than 100 percent of collections, the practice is money ahead.

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