The debate on whether to choose in-house billing or outsourcing Ob/Gyn RCM depends on a multitude of factors such as practice, time the business has been around, market size, and finances. As Ob/Gyn billing and coding is the most crucial and complex constituent of medical practice, factors need to weigh appropriately before an action is taken on choosing the service. Again, due to newer and constant innovation of technologies, drugs, and codes, and government regulations, practitioners need to often choose which service will work best for them. Moreover, the management style of the practitioner/healthcare center tends to be an important aspect in deciding between the two options.
So what do these alternatives imply?
In-house billing refers to the billing and coding done by the staff of the practitioner/healthcare center i.e. all aspects of revenue cycle management such as insurance verification, patient registration, coding, submission of claims, and collections from insurances and co-pays and managing A/R’s which are handled by the employees. It could be a separate department in a larger center or the work overlaps between the administrative staff in a solo practitioners’ facility. In the case of outsourcing, a company is hired to take care of all the billing needs which charge a percentage of the collections or a fixed fee. However, it is imperative that the costs are evaluated before the work is given to the outsourcing company (costs should ideally be around 5-10% of the total revenue earned).
Pros and cons (in-house billing):
As soon as a patient visits the facility, insurance verification is possible spot on, and charges can be entered in the system leading to faster claims and payments by the staff. The physician can also have quick access to financials, such as past-due patient accounts, along with other expenses and revenues being traceable.
Once the physician/healthcare center has recruited a billing team, education and training continue along with the possibility of accurate and timely billing services. A competent billing manager will be able to provide regular guidelines and ensure that the staff is updated on the constantly changing codes and billing regulations. He can also handle all the issues related to software and technology.
In-house billing gets easier if documentation or codes need to be re-checked by a physician, which can be then done instantaneously. Sometimes, due to this proximity, the physician has better control over every aspect such as scheduling, purchasing, and finances, and the patients details remain confidential.
4. Few staff:
However, is the billing team is small and someone is absent (vacation/illness/quits), the operations can get disrupted and the revenues can decline if another competent personnel is immediately unavailable and/or is not being recruited at the earliest, and the workload increases. And if the billers are not competent, it can create a serious dent in the cash flow.
In-house billing can be expensive as physicians have to pay for employees’ salaries, allowances, and medical insurance along with other billing setup costs (technology, coding, execution).
Pros and cons (outsourcing):
Costs related to office space, investments in software and hardware, billing personnel and their salaries, health insurances, seating and storage space, training costs, etc. are avoidable.
There are no worries about staffing as replacements are available at all times. And as the billing is being taken care of by competent and certified billers, it leads to lesser denials on claims, along with the outsourcing company having the ability to figure out and fix the reasons for denials. Again, as the billing and coding personnel are experts in ICD-10 as well as other specialty codes, they tend to garner the most accurate and timely reimbursements.
If the medical company provides performance reports, the outsourcing company can automatically gain visibility of their billing operations.
The Ob/Gyn outsourcing company is more consistent in terms of accuracy, timing, and regularity in sending claims and their follow-up. They are also able to identify denials and other reimbursement trends.
Physicians who prefer to possess complete control and monitor operations may not fancy this option. Also, if the service fee is not set and depends on revenues, it tends to create issues as the billing budget varies and costs fluctuate widely. Also, add-on services such as cancellation fees, printing reports, sending of added claims and emails, etc. can end up costing more.
A cost-benefit analysis of requirements must be done before Ob/Gyn physicians/healthcare centers opt for the best fit.