Analyzing the Cost of In House Billing vs. An Outside Agency
The cost differences between employing an in house billing specialist or hiring an outside billing agency to handle a health care company’s billing services can be immense. Aside from the health care services provided, billing and revenue cycle management are fundamental to the financial health and overall wellbeing of any health care practice. The cash flow of a health care practice is dependent upon accurate, efficient, and effective medical billing practices, which is why any decision surrounding the medical billing services of a health care practice should not be taken lightly. A thorough assessment of a health care practice’s staffing, costs, and volume metrics is crucial in making a decision regarding in house billing or opting for hiring an outside agency.
In House Medical Billing
There are numerous perks to handling medical billing operations in house. Some examples of the pros to handling medical billing services in house can include the following:
- Proximity: should a billing issue arise, having an in house billing department can allow issues to be resolved in a timely matter, as they are located in close proximity to, if not directly in, the health care practice’s facility.
- Control: retaining control of financial operations through the use of long-term, trusted employees that doctors, administrators, and additional health care providers have direct access to can allow a more hands-on approach with regard to medical coding and revenue cycle management.
- Return on investing: training in house medical billing specialists can be costly, as is the cost of up-to-date billing technology. Once a health care practice has committed to using in house billing and purchasing the needed billing technology, all of this money and time can be lost if a company opts to switch to outsourcing billing.
The drawbacks to handling in house medical billing services can include higher costs, as payment for fulltime medical billing specialists can be expensive, as are the technologies needed to properly support a medical billing department.
Outsourcing Medical Billing
Depending on the needs of a health care company, outsourcing medical billing services may be advantageous. Here are a couple examples of the pros to outsourcing medical billing operations:
- Less expensive: for new health care companies, hiring an outside billing agency will often make the most financial sense, as they can help develop and instill healthy billing practices.
- Performance reports: any medical billing agency should be able to provide comprehensive performance reports, informing a clear understanding of all billing operations.
There are also drawbacks to outsourcing the medical billing needs of a health care practice. Unfortunately, there can be hidden fees when working with an outside billing agency, which is why it is essential to carefully review a contract prior to making a decision. In most cases, medical billing companies charge a percentage of collections. Hence, the more money a health care company draws in the more it will pay to the billing agency.
What Is Best?
In analyzing the cost differences between in house billing services and outsourcing the medical billing needs of a health care company it is also essential to take into consideration the nonfinancial implications, including the benefits and drawbacks of both options. The ultimate answer for which is best, to hire an outside medical billing agency or to handle the medical billing services in house will differ from practice to practice. Identifying the unique and specific medical billing needs of a health care practice will help an organization make the right decision.
As insurance regulations change, it is imperative that companies understand how each change can affect their practice, in all aspects. Insurance companies are notorious for offering excuses and utilizing loopholes to avoid paying providers what they owe. Accreditations such as CARF and JCAHO are now a common requirement for insurance companies to render payment. These certifications alert the public that a company has been adequately inspected and is considered reputable, meeting the accreditations high standards. The accreditation process can be arduous, requiring a significant amount of time and energy. Our staff offers diverse skills that enable Oracle Billing and Services, Inc. to assist in areas ranging from CARF-Accreditation, Verification of Insurance benefits, Insurance Collection Calls, Drug/Alcohol state licensing, JCAHO-Certification and more. Oracle Billing and Services has extensive experience in assisting companies in the health industry, in understanding the ever-changing regulations as well as providing expert consultation for all areas of operations.