Billing is an essential part of every medical practice, but sometimes it's best left in other hands, so your staff and medical professionals can focus on other aspects of the practice. Outsourcing your billing to a third-party service is a great way to reduce overhead and free up resources.
DrChrono is a well-priced medical billing service that provides users access to easy-to-use and effective electronic health record (EHR) and practice management software. Pricing for DrChrono ranges from 4 to 9 percent of net monthly collections, typically falling around 6 percent for the company's average client. There are no additional setup or clearinghouse fees associated with DrChrono's revenue cycle management (RCM) service.
One of the most unique features of DrChrono's billing service is its hybrid plan, which is specifically designed to provide a low-cost solution to new practices that are still ramping up operations. It saves new practices the cost of hiring a certified coder, but also allows them to handle some of their billing in house to keep outsourcing costs low. As time goes on, practices can make a decision whether to fold billing into their internal operations, or fully outsource RCM to DrChrono at the normal rates.
AdvancedMD's medical billing service is well worth the price tag. Not only do you gain access to AdvancedMD's integrated electronic health record (EHR) and practice management software for free, but you'll be guaranteed in writing a 95 percent first pass claim rate. AdvancedMD's billing process is comprehensive, from coding claims to following up on denials and unpaid balances, and it includes robust support from a U.S.-based support team.
AdvancedMD's most advantageous feature is that the billing department uses Optum, the same scrubbing software as their preferred clearinghouse partner RelayHelp. That ensures that any errors that would be caught by the clearinghouse are flagged and rectified prior to submission, reducing the denial and rejection rates.
Human Medical Billing is a small medical billing service that excels in its personalized attention to clients and its flexibility in terms of contract requirements. Human Medical Billing will take care of everything from credentialing to the billing process, and allows for contract cancellations with just a 30-day notice. The company charges a $500 monthly minimum or a rate of 6 percent of net monthly collections, whichever is greater. The 6 percent rate could potentially be negotiated down depending on the specifics of your practice.
Human Medical Billing does not charge any setup, implementation or clearinghouse fees; everything is included in your monthly rate. The company also has a unique committee-style system that uses teams of experts to focus on one aspect of the billing process. This ensures that the people handling your billing are well-versed in the areas of the process they cover.
Medical billing is a wildly complex and unwieldy process. Any healthcare provider knows that there is a lag between services rendered and payment received, and the amount of revenue each patient encounter generates is unpredictable and variable. That means a good billing department is nimble, adaptable and continuously educating itself. For some practices, that can be a tall (and expensive) order. When medical billing becomes too much of a hassle, there are professional services which can manage your billing process in exchange for a percentage of your net collections.
Pricing models are largely the same in the medical billing service industry. Most companies in our review charge a percentage of net monthly collections, meaning the more revenue they generate for you, the more they get paid. Those percentages typically fall between 4 and 9 percent, although there are outliers on both the low and high ends.
Some companies also charge additional fees, such as setup fees, implementation fees, or clearinghouse fees. These fees can vary greatly from company to company, so it's important to question sales representatives to find out what their policies are.
Occasionally, medical billing services will institute a monthly minimum, which must be paid in case the percentage of a practice's revenue for the month isn't high enough. Other services will charge a base price per provider per month, on top of which a small percentage of collections is taken, but this model is rare.
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Outsourced Revenue Cycle Management vs. In-House Billing
Whether you contract with a medical billing service or keep your billing in-house depends entirely on how large your practice is, how much revenue you take in and how you utilize your staff. When doing billing in-house, you will need a certified medical coder on staff. You will also need to keep up with ever-changing medical laws and codes. Numerous things can go wrong with a medical claim, such as a simple coding error, which will make insurance companies reject them. It will be up to you and your staff to deal with rejected claims if you do in-house billing. Billing services take care of all of that for you, so it's up to them to stay on top of drafting claims.
Cost can ultimately determine which is the smart choice for your practice. In-house billing requires payroll for a medical coder and usually an annual license for medical billing software. Someone with this certification will cost more to employ than an average clinical staff member and taking care of claims will likely be their full-time responsibility. Billing services typically charge a percentage of net collections, often between 4 percent and 9 percent. You should be able to calculate what makes financial sense for your practice. On a perfunctory level, you must consider a medical coder's salary versus the speculative cost of service's percentage, though there are many other costs to your practice to consider for each route.
Outsourced billing can be a good solution for small practices that need their staff to focus on other aspects of running the office. Having one person on payroll as a medical coder may not make sense budget-wise with the number of patients the practice serves. For larger practices and hospitals, a billing service may not be as worth it if you have the budget for medical coders and have a large volume of claims you believe you can handle internally.
To determine our best picks for medical billing services, we created a list of roughly 30 reputable companies, based on other reviews and customer feedback. From there, we eliminated vendors that had higher than average pricing, restrictive contract requirements, or failed to respond to initial requests for additional information.
That left us with a list of 10 finalists, from which we chose our three best picks. Those finalists included: AdvancedMD, athenahealth, CareCloud, Chart Logic, Clinical Info Solutions, drchrono, Human Medical Billing, Iris Medical, NueMD and Talisman Solutions.
To determine our best picks, we considered the following criteria between our 10 finalists:
Pricing: How did the service's pricing compare to others in our review, and was the company up front about how their pricing model works and what is included?
Additional fees: Are there additional fees on top of the base pricing? Did the company explain these fees in a forthcoming manner?
Contract requirements: What is the minimum contract requirement? Is there an opportunity to cancel early for no fee if service is not meeting expectations?
Claims process: What does the claims process look like, and what services does the company include in its pricing? Are there certified coders on staff? Will staff follow up on outdated or denied claims?
Specialties: What specialties does the service commonly work with, and will it tailor its process to the needs of the practice given its specialty?
First pass rate: How many claims are generally accepted by payers on the first pass, and how many require resubmission or follow ups?
Support: What kind of support team can a practice expect from the service? Are there dedicated account managers that act as one-to-one liaisons for any and all questions?
Reporting: What kind of financial reporting can a practice expect and how often? Are reports customizable? Are they available on demand?
Customer service: Were customer service and sales representatives friendly, knowledgable, and up front about the specifics of the service? Were they able to answer all our questions? Was contacting the correct representatives straightforward? Was there a long wait time for assistance?
A medical billing service should improve your revenue cycle management by boosting your revenue and helping you fully understand the financial health of your practice. Read all our reviews to find the best fit for your medical billing needs.
When negotiating with sales representatives for a medical billing service, it's important to ask the right questions. Take your time and thoroughly investigate your options. This isn't just a simple product or service you're buying – it's the complete management of your medical practice's financial health. A good medical billing service can boost your profits and reduce your workload, but a bad one could sink your business, so take your time.
Here are some key things to keep an eye out for:
What is the percentage of net monthly collections the billing service takes? Does that include any fees? Is there an additional cost beyond the percentage?
What kind of reporting or visibility do you have into billing operations? Can you see claims status in real-time? Do you receive monthly reports? How can data be sliced and diced?
Does the medical billing price include access to an EHR and practice management system? If so, how does the software work and are you on the hook for any fees associated with implementation or training?
Does the company maintain its own certified medical coders on staff?
What is the claims scrubbing process prior to submission?
What is the company's "first pass claims rate?" In other words, how many submitted claims are accepted by payers the first time?
What will a company do to solve rejected or denied claims? What about unpaid claims?
Is there a dedicated account manager that you can go to with any questions, problems, comments, or complaints?
What are the minimum contract requirements, are you able to cancel your contract if service is poor, and are there any cancellation fees associated?
As always, be sure to have an attorney look over any contracts before you sign. If you can, speak with colleagues in your industry about the services they use and whether they are satisfied. Outsourcing your revenue cycle management is a massive undertaking and it should not be taken lightly. Do your homework to ensure you are partnering with a company that not only has a positive track record, but will also be the right fit for your practice.
State of the Industry
Medical billing services are a fast-growing sector of the healthcare industry. A report from Market Research Engine found that the Global Medical Billing Service industry is expected to grow beyond $16 billion in total market value by 2024. The report finds that the major driving factors contributing to the growth of the industry include rapid changes to healthcare regulations and efforts to increase revenue growth.
Similarly, a report from Transparency Market Research Report finds that the industry is poised to continue its rapid growth through 2023. The reason? There is growing perception among small and mid-sized healthcare providers that outsourcing their medical billing process will cut operational costs and improve their efficiency. Further, the report reads, the high cost of maintaining in-house billing staff and the management software required is a barrier to keeping billing operations in-house.
Common Medical Billing Service Questions & Answers
Have a medical billing service question of your own?
Overdue payments are a chronic problem in professional services, which is why I've always advocated being paid in advance, even if it means a small discount. There are times when payments are late because of client cash flow problems (primarily in smaller businesses), or because invoices are lost, or because mistakes are made.
But late payments are usually a product of either overly bureaucratic rules being enforced or just sloth. When a client says "It takes 30 days to go...
You can do all of that. Personally, I send an invoice to my clients for 50% of the accepted proposal in the beginning, and will start on the project as soon as I receive notification the invoice has been paid. Then a second invoice upon completion and launch of the project.
Benefits: no printing, mailing, ink, no waiting on the post office to deliver the mail with the invoice because it is delivered immediately through email, and shows immediately in my account upon payment...
I would look at which states you want to bill in. Then go to each state's department of commerce website as you will need to get licensed in each state to be able to bill. From there, I would post on LinkedIn or a similar site to find people who know how to bill, what software you need to get started, etc. That should get you moving in the right direction. Good luck.
There are multiple options available to you, but yes, you should do the accounting in a program. If you start from now using accounting software, you'll have all of your history in one place and can generate reports to compare time periods. And many import your transactions, so if you know what they are for, it won't take long to post.
That doesn't mean you have to do the work yourself. If it's a fairly simple business, you can have a teenager or intern assist you as long as you understand...