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Medical billing has become increasingly complex thanks to insurance industry practices and inconsistencies, and ever-changing regulations. Navigating those complexities accurately and in a timely manner is essential to every medical practice that depends on cash flow to function; that’s every practice these days. Inefficient billing methods, inadequately trained staff, lack of supervision, and constant software updates cause errors and delays that cost you money. You can’t afford to have billing complications slow your revenue stream down to a revenue trickle.
A practice that sees 30 patients a day must submit 150 patient claims every week, 50 weeks a year. Following up with insurance carriers, denied claims, resubmissions and research, invoicing patients, posting payments, running reports, and performing practice analysis requires additional staff resources.
Medical Billing Services Save Money
Let’s look at a small physician practice for the sake of simplicity. The practice has a dedicated in-house biller.
- Base Pay
- Medicare and Social Security
- 401K
- Disability
- Healthcare
- Time off
- Total labor cost of 1 in-house biller
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$30,000
$2,295
$1,080
$720
$5,220
$3,270
$42,585
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Then let’s add the operational costs:
- Software/Hardware
- Materials
- Clearinghouse Fees
- Total operational costs
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$2,000
$1,800
$720
$4,520 |
The annual cost of in-house medical billing comes to $47,105 per year.
Now let’s see what happens if the same practice contracted with a medical billing service to perform claims generation/submission, insurance follow up, patient invoicing and support, detailed reporting, expert practice analysis, and other related services. Let’s assume the practice negotiates a fee of 8% of collections. Other fee structures are possible, including flat fees.
In our example, the practice has 7,500 patient encounters a year, with an average reimbursement of $60. Annual receivables are $450,000. At the 8% rate, the annual cost of professional billing services is $31,500.
That’s a savings of $15,000 a year.
Medical billing services invest in training and research to stay on top of current reimbursement codes, submission requirements, industry trends, and government regulations - so you don’t have to. They constantly implement software improvements and updates. Their highly trained specialists spend endless hours dealing with insurance carriers and clearinghouses. They even talk to your patients who have billing concerns.
Medical billing services provide specialized knowledge, continuity of operations and a network of support. They eliminate your dependency on one or two costly staff members to maintain revenue flow for your entire practice. Professional medical billing services leverage economies of scale and efficiencies of specialization to save physician practices operational time and expense while improving billing accuracy and revenue flow.
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Outsourcing 
TBO emphasizes a "culture of compliance" in all phases of operations.
