How to bring in cash like a billing company

The claim: Outsourcing your medical billing will save you time, resources and headaches. Well, sure, I've thought to myself while researching the topic. I could make the same argument to hire a cleaning service or a personal chef. In fact, make it a live-in housekeeper. Let's get this house humming with efficiency!

Oh, sorry. Did you say something? Ah, yes--I'm back now. The boss--yours truly--says that's not how it works. Those tasks, though admittedly not my favorite, are fairly integral to my position as administrator of my household. The staff (though two-thirds of them too short to empty the trash) and I will just have to roll up our sleeves and get it done. Hiring help isn't free, you know.

But what if outsourcing could help me make more money?

According to medical billing companies, that's exactly why you should turn your claims, your collection calls--essentially your entire revenue cycle--over to them. So the theory goes, they'll get you more money in the door, or at least more quickly and with fewer denials. You'll then be freed up to truly focus on making the patient encounter as seamless as possible, thereby rocketing patient throughput and revenue to even greater heights.

Depending on who you talk to, this may or may not be the reality. But if it is true, what makes it possible?

According to Mary Pat Whaley, administrator of Halifax (N.C.) Regional Medical Center and founder and editor of ManageMyPractice.com, one advantage of billing companies is speed. "Often small practices are only going to transmit claims once a week or twice a month, while a billing service is dropping things daily or even every two or four hours." The lower the lag time between when a service is provided and the charge is posted, the faster your practice gets paid.

As for denials, Whaley says, the secret is catching mistakes on the front end before they become a claim. There are three levels of denial, or gates, she explains, that a claim must pass through before it is paid or denied; and billing services are often more sophisticated than in-house billers at catching problems at the software, clearinghouse or payer level. "If you can fix your claim before it's accepted into a payer's system, you can do so using up only 48 hours. If you wait 30 days for a denial, you have to then figure out how to fix it, resend it, and wait another 30 days to see if it gets paid."

Finally, by filing perhaps exponentially more claims during a given time period, experience may give billing companies the ultimate edge, notes Frank Cohen, senior analyst at Florida-based medical practice consultancy MIT Solutions, Inc. "If I was going to have an open-heart surgery, would I want a doc who did one or two operations a year or 1,000?" he asks. "I want someone who is the most expert they can possibly be."

So, what do you think? Issues of relinquishing control and finding the right company to work with your practice aside, can outsourcing really deliver on its promises? If so, I might have to put some serious thought into getting that housekeeper. It's starting to look better and better on paper at least. - Deb