Four Tips to Consider Before Switching Medical Billing Companies

New technologies have significantly improved administrative tasks yet many healthcare organizations today still rely on manual processes that cause administrative strain and employee turnover. Retaining and recruiting non-clerical staff is difficult and can be expensive. In the US, the average cost of hiring a new employee is $4,425. In healthcare, this cost can easily exceed 30 percent of the annual salary for the position.

Hiring is not an easy process and takes time. Forty-two days is an average amount of time it can take to hire new staff. And the time required to train new staff, around five to eight months, can increase the burden on the rest of your staff. During the onboarding process, new employees must familiarize themselves with coding claims appropriately and staying up to date on the latest changes in coding and billing. Meanwhile, your experienced team members are likely overworked trying to keep up with responsibilities while understaffed.

If you find your administrative team is stretched thin, it may be time to outsource medical billing services. This blog offers ways to improve medical and collections during staffing gaps.

Or perhaps you currently outsource your medical billing but are unhappy with your vendor. Aside from the obvious cost considerations or low reconciliation rates, organizations often leave their current billing company due to non-monetary reasons such as compliance issues, poor patient experience, lack of vigilance, or failure to provide reports to clients. Before making a switch, it is important to do your due diligence to find a partner that fits with your organization and delivers on reconciling old claims in a fair and efficient manner.

Here are four points to consider before switching billing companies:

Don’t underestimate the strategy and consulting phase

Medical billing is a complex process. Aligning with the right vendor that shares data and develops strategies based on revenue operations and impact is critical. Some medical billing companies charge a collection percentage. Other companies charge per CPT code, especially those located in states that disallow collection based on percent. Be cautious as you make the switch. A new billing company may impose such charges after you’ve already paid the previous billing company. Your best decision might be to stay where you are. The key to making the right decision is due diligence.

Know your expected value

It is important to evaluate and understand the value of your inventory and know what you can expect to get with old account receivables (AR). It is all about accuracy and transparency. In some cases, there may be a large number of bills that were never sent, or were billed incorrectly, and therefore not accounted for by a previous billing provider. You would be surprised at how much money can be left on the table if not identified. Some billing companies avoid providing this information, or won’t reveal its worth, in order to appease a healthcare practice with old AR to increase the possibility of a larger amount of permanent billing. From a total collection perspective, it is all the same. Best practice is to identify a reliable partner that takes total accountability of the process.

Evaluate past vendor performance

Understanding who is coding your charts is an important step. Does your potential billing partner have experienced coders by specialty, case mix, etc.? What is their QA process? These are important questions to ask to determine not only quality and accuracy, but also where they specialize. For example, let’s say you’re an ER group. A vendor has excellent quality and turnaround times, but 90 percent of their clients are in radiology. It makes sense to pass on this one since specialty knowledge is critical. And finally, determine the specifics of proper reconciliation. Is a percentage of charges being lost? If so, is there a front-end problem or transfer problem? Could this be a coding issue or are they missing procedures altogether?

Assess their compliance program

Compliance is a serious word for a medical biller—with good reason. It means you follow the rules and regulations, and it covers a wide variety of issues from privacy of patient information to billing practices. In some cases, billing companies may be too conservative, which could lead to loss of revenue. On the other hand, an aggressive approach can create issues. Does the billing company that you’re either leaving or considering have a compliance program in place? If so, evaluate their policies and procedures.

If you are looking to maximize or improve collections or don’t feel like your practice is getting quality service, it might be time to switch your medical billing company. Medical practices can ease the burden of change by following these four guidelines.