It seems that no one would volunteer for a pay cut, but some providers are doing just that.  Physicians are fighting hard to repeal the government’s 27% SGR reduction, but many in private practice are voluntarily accepting pay cuts anyway.  How can this be? The AMA states that many private practices using in-house billers leave an estimated 10%-15% of the practice’s revenue uncollected--either through a lack of billing education or unmotivated employees.  And the amount of money that goes uncollected can be staggering. 

The CPA of a large surgical group recently asked us to conduct an audit of the practice’s billing.  This practice was receiving 100% of all the fees being requested, so the doctors thought their billers were doing a great job.  Not so fast.

We concluded that this group lost $600,000 in one year, mainly because their billers were using an outdated fee schedule--that’s more than a month’s worth of revenue.  The head of this billing department didn’t know that fee schedules change, thinking that if they did change the payers would have told her.  The truth is that providers rely on billers for their income.  If you’re entitled to $100 and don’t know it, and only ask for $75, that’s a 25% pay cut.  We see this over and over. 

Use of a billing service is cheaper and more productive than in-house billing.  Most billing services charge less than the 10%-15% that you’re not collecting.  And you’re still paying a billing staff on top of that.  The fact is use of a billing service affords practices much greater control over their billing.  Our basic industry standards are set much higher than any office setting, and billing services are better able to keep a practice up to speed on compliance regulations.  Billing has undergone many changes in the past five years, and keeping up with these changes is simply unaffordable to the average medical office.  Billing services offer economies of scale, which means sharing of costs over a wide client base.

A good service will offer more than just billing.  You should look for their staff to consist of Certified Professional Coders and Certified Specialty Coders, and their billers should have multiple years of experience billing in your specialty.  They also should offer a variety of programs designed to accelerate your cash flow, like claim scrubbers to catch errors upon submission.  Online patient eligibility verification, and online patient bill pay options should round out the list of amenities that should be on the list of any billing and coding service worth its salt.

A good billing service will also perform random client monitoring on both billing and compliance issues, all designed to prevent a government audit.  Better services can generate custom-designed reporting tailored to your specific needs, and clients should even be able to create their own reports using dashboard reporting tools—perks not available to the in-house operation.

Nobody wants to volunteer for a pay cut, let alone a preventable one.  With the government forcing reductions in attempts to balance the national budget, don’t lose more income through neglect.