The Pros and Cons of Outsourcing
The question of whether to outsource medical billing operations or keep the process in-house is one that weighs heavily on many doctors and practice managers. The right answer differs from practice to practice based on a multitude of factors: age of the business, size of local labor market, and state of practice finances, among other considerations.
Aside from clinical services, billing and revenue cycle management are the most important processes of your practice. Your cash flow depends on them, so the decision of how to handle these services shouldn’t be taken lightly. You should do thorough assessments of your practice’s cost, staffing, and volume metrics to determine what’s right for you.
In the preliminary stages of the decision-making process, however, you’ll need to take a generalized look at what most doctors and administrators consider to be the major advantages and disadvantages that the in-house and outsourcing options each present.
Cons of In-House Medical Billing
Higher Costs: It’s generally accepted that the expenses of paying billers’ salaries, covering employee benefits, and purchasing technology systems add up to more than is commonly paid out to a third-party billing solution.
Liabilities: Medical billing departments can be hotbeds for embezzlement, and general employee neglect (think ignored encounter forms, discarded superbills, and unappealed claim denials) can go largely unnoticed if managers don’t keep a stringent eye on billing operations.
Support Issues: If your billing department consists of only two or three staffers, your operations – and cash flow – can be majorly stalled when even just one employee gets sick, goes on vacation, takes a leave of absence or quits altogether.
Pros of Outsourced Medical Billing
Less Expensive: Especially if you’re starting up a new business or transitioning because of an employee’s resignation, outsourcing makes the most financial sense. Check out this hypothetical cost analysis on the topic from Physicians News Digest.
Transparency: A medical billing company should be able to supply you with comprehensive performance reports automatically or upon request. This capability grants you unparalleled visibility into your billing operations without requiring you to micromanage – or even oversee – any staffers.
Enhanced Consistency: Your outsourcer will be contractually obliged to perform certain services, such as appealing denials, for you with a certain level of success. Plus, you never have to worry about staffing, since it’s their job to support your needs year-round.