Unrealistic guarantees:

Have you ever received marketing material from a billing company that promises payment from insurance in a certain amount of time or an accounts receivable balance below a specified dollar amount?

The time it takes for insurances to pay varies greatly. Practices with very different insurance mixes will likely have different wait times for payment. Different specialties can also have delays. It is important that the billing company look at your specific practice.

A practice’ accounts receivable will also vary based on the patient mix. Even more alarming is the promise of a specified dollar amount as this has no meaning. Depending on the amount marketed, a small practice might be a given to be below this amount while a large practice would only realistically reach the goal by writing off balances rather than doing the work to get anything and everything possible collected. A better (yet still flawed) promise would be to maintain below a certain percentage of accounts receivable over a specified age.

The non practice-specific approach:

Have billing companies quoted rates to you with no knowledge of your practice or regard to your specialty?

The cost to provide professional billing services will vary based on specialty and specific client requests. Insurance follow up and working of all denials are a vital part of the billing process. There is therefore a cost associated with the number of patients a practice sees. Following up on a $100 claim takes the same amount of time as following up on a $1,000 claim. This means a high dollar specialty can be charged a lower rate than a specialty with a low average claim reimbursement.

The level of reporting and the frequency of meetings with the billing company will also affect the cost to provide the billing service. A legitimate medical billing company will base their pricing on practice specific information. A company that quotes a flat rate for all specialties and practices will not provide your practice with the attention it needs and deserves.

Rates that are significantly below Market:

Effective medical billing takes time and costs money. If it were easy there would be no billing companies. When evaluating a potential billing company you should compare their rates with others to make sure they are competitive. If they are significantly higher or lower than the rest of the market you should ask why. A company that quotes a rate significantly lower than its competitors is not taking the time to make sure your account is handled correctly. The only way to do this and remain profitable is to only collect the claims that are easy and write off the others. Always remember, if the company collects less than its competitors, the lower rate will actually cost you more in lost income.