Proper Medical billing is time consuming and arduous. It often takes the attention of medical providers from their core expertise. Why? Because they often end up processing the billing themselves, or at the very least, being heavily involved in the process. We believe that medical Providers should spend their time doing what they love, and that is patient care, not medical billing.
Constant changes in the healthcare industry, medical billing procedures, ICD-10 codes as well as HIPAA regulations can affect the revenue or cash flow for the practice. It can get worse with the wrong billing company. This means there’s a lot to keep up with. When you consider healthcare providers in private practice as well as large organizations, it is inevitable for errors to occur.
Healthcare organizations can choose one of two options. Establish an in-house medical billing department in the practice Or, you could outsource your medical billing to experts. Experts such as Lightspeed RCM, Revenue Cycle Management. Let’s review the cost analysis of both options below. This information will help those looking to find a reputable and reliable (RCM), Revenue Cycle Management company make the right decision.
Let us compare the data below provided by, www.MTBC.com.
They have included industry averages to compare:
In the scenario listed below, from WWW.MTBC.com, the Practices is loosing approximately, $250,000 in cash flow, for in-house billing.
- Three physicians
- Two medical billing experts
- 80 insurance claims/day
- $125 bill per claim:
Explanation of the data, are specified below:
Billing Staff Expenses
In-house: The billing staff expenses are based on approximate average costs in the US.
1 Medical billing employee = Salary + healthcare + state taxes + training cost
= $40,000 + $4500 + $6000 + $1000
Also included $15,000 for office space, office equipment and other related expenses.
Outsourced: 5 hours are included to process the medical billing. On an average it is $15 per hour. Other circumstances may require additional hours. Which can cost up to $4000 annually.
Software & Hardware Cost
In-house: Practice management software costs about $7000 per system annually and $500 for computer hardware.
Outsourced: If you take into consideration, printing and other minor charges, it can cost $500.
In-house: If you face on average of 20,000 claims per year then it would cost you $3600 annually.
Outsourced: Medical Billing companies typically, charge a percentage of the collected amount as their fees range from 4% to 7%.
Percentage of Collected Amount
In-house: For the most part, only 60% of the bill is collected (if you have an in-house billing department).
Outsourced: It costs up to 15% if you outsource your medical billing.
If you’re looking to improve your cash flow or revenue cycle and provide more time for you and your staff to have more time for patient care, based on the data above, outsourcing your medical billing is your best option for achieving your goal.
1. “https://wwWhy Should You Outsource Your Medical Billing?” MTBC Official Healthcare Blog, 2 Oct. 2018, www.mtbc.com/learningcenter/outsource-medical-billing/.
2. MarketScreener. “MTBC Medical Transcription Billing : Why Should You Outsource Your Medical Billing?” MarketScreener.com | Stock Exchange Quotes| Company News, 10 July 2018, www.marketscreener.com/news/MTBC-Medical-Transcription-Billing-Why-Should-You-Outsource-Your-Medical-Billing–26905483/.