July 11, 2014
Outsourcing, till a few years back was seen as a fad by the experts but today it is an industry in itself. One finds processes being outsourced in almost every business and more recently the field of medicine has also joined the bandwagon. The topic of discussion here is, whether the process of submitting and following up on insurance claims, better known as medical billing should be outsourced by hospitals, clinics or be kept in-house.
There is no right or wrong answer to this debate. It is a different scene for every practice and it depends on factors such as size, need and earnings of the practice. The goal of every medical practitioner is to provide the best medical care to the patients whilst maximising the revenue and controlling the costs. This is one of the main reasons why choosing an appropriate medical billing methodology is important.
Both the methodologies, in-house and outsourcing medical billing services have benefits as well as drawbacks, and therefore, it is very important that every individual practice weighs the pros and cons well before choosing the best suitable approach for them. Mentioned below are a few pros and cons of both the methods that will be useful to the practitioners.
In-House Medical Billing Pros
Control: An important advantage with the in-house billing methodology is that the practitioner has more control over the daily operations and can monitor all the activities closely. This results in better functioning and more accountability. It also reduces the chances of delays and errors in the billing procedure.
Complete security of information: In today’s time, maintaining confidentiality of any information is important to every kind of business. An in-house billing system enables practitioners to maintain secrecy and helps reduce and avoid any unwanted breaches of sensitive patient information.
In-house Medical Billing Cons
Cost: Maintaining an in-house billing system means investing in additional manpower, software and technology for smooth execution of the billing process. This might sometimes lead to adding more costs than actual revenue generated.
Administrative problem: There are administrative issues one might encounter while managing employees from the in-house billing department. Attracting and retaining the right talent, competency and performance issues, disciplinary problems to name a few. If the billing team is small, all these problems can pose to be hindrance in the smooth functioning of the process.
Outsourced Medical Billing Pros
Focus on medical care: By adopting the methodology of outsourcing medical billing activity, one can concentrate wholly on providing the best medical care to patients. The practice will be free from the burden of managing various issues such as administrative, technology related and all other operational problems. They can thus completely focus on providing the best medical service to their patients.
Transparency and credibility: A good billing company will be a team of professionals with robust processes in place. The practitioner can demand for regular reports which can be audited at regular intervals. Since a third party will be managing the billing process, there will be less scope for negligence or fraudulent activities that can be carried out. This will bring about more transparency to the whole process and in turn will increase the credibility of both, the practitioner and the medical billing company.
Cost effective: Another advantage of outsourcing the billing process is that it is cost effective. Most of the billing companies follow similar pricing methodology. They charge a percentage of the overall collection of the practitioner which implies that they earn only if the practitioner earns. Therefore, the billing company will work hard to deliver good results.
Outsourced Medical Billing Cons
Loss of control: The outsourced billing methodology often creates disconnection between the billing function and the practitioner. The practitioner is aloof from the day to day billing activities and therefore might not be able to foresee any forthcoming issues or problems to address them beforehand.
Hidden costs: All practitioners opting for outsourced billing must carefully read and thoroughly examine the terms of the contract they are entering into with the billing companies. They should be aware of all the possible costs that the billing company is capable of charging, for example, charges for cancellation of the contract, cost involved for generating and sending reports. The practitioners must ensure that they are getting a cost effective service from the billing company.
To conclude, it can be said that every practitioner must carefully evaluate the needs of the practice before choosing the billing methodology. Cost is definitely an important factor in the decision making; however, other factors involved are also equally significant and should also not be ignored.