The Anatomy of Working with a Third Party Billing Company
In-house billing for an urgent care can be a stressful endeavor for an urgent care platform that is either starting out or is in a financial pinch. However, there is a solution that could increase the overall bottom line for an urgent care. The Ambulatory M&A Advisor examines the process, benefits and more of an urgent care outsourcing to a third party billing company.
Cara Buckhaulter, Billing Services Operations Manager for NueMD Billing Services explains that there are several benefits for an urgent care business to work with a third party service.
“One of the largest benefits is that they are not required to employ billing staff when they outsource to a third party billing company. If they were going to hire someone in the office, they likely would have to hire more than one person. Then, not only would they be paying that person, they would also have insurance costs. By outsourcing they eliminate those overhead fees that they would have to pay a staff person as well as the requirements of oversight of a staff person,” Buckhaulter says.
“The next thing I would says is by outsourcing you get someone that is knowledgeable. They are well versed, especially if it is someone from a company that has experience in urgent care billing. You would have billers and coders in your specialty that are up on the rules, regulations and coding guidelines. That is hard to get when you are just hiring someone from the office.”
Max Lebow, MD, Medical Director of Reliant Immediate Care Medical Group Inc. backs up Buckhaulter’s views by saying that third party billing can stay current with the complex rules and regulations, not only of the Federal government but the state Medicaid.
“A third party biller who has staff dedicated to keeping up with all of the rules and regulations, and all of the preferences of the different insurance companies and different payors will be more likely to be able to submit a bill that is accepted for payment on the first try without getting returned for further analysis or denials of service,” Lebow says.
Lebow says a third party biller, especially if they are billing for multiple sites, is getting heads up from their experience with a large group of payors and gets to know the right people to call at the insurance companies and at the state and federal levels. This helps them make sure that questions are answered right away and that the bills go through as clean claims, or claims that meet all of the billing requirements by a particular payor. There are rules that payors have to pay in a timely way and most payors have to accept electronic billing.
“That is another important point to make. Until recently, a doctor or practice could submit their bills however they would like to; but now the standard is to submit them in an electronic format. Making sure that that electronic format is perfect and can be accepted at the other end is an important part of making sure that you are paid in a timely manner. It has just become so complex that many small practices are leaving a lot of money on the table. You don’t want to give that much advantage to insurance companies and other payors,” Lebow says.
What Lebow has found with smaller urgent cares, is that at least with half of them, their billing was being done by a relative of a doctor or somebody they knew who was not professional. The businesses didn’t realize the expertise that was required to do billing in today’s environment.
“It is not only to get the money that is part of it. If you don’t get paid for what you do, the worst thing that can happen to you is that you go out of business. If you submit bills that fall into non compliant status or are overbilling, you could run into compliance problems as well. Compliance can be a lot worse than going out of business. If you submit bills that are non-compliant, you could get in trouble and get audited. It is very important from a safety point of view to be billing using people who are experts in the field,” Lebow says.
When selecting a billing company, Lebow says owners have to dig deeper and ask questions like how quickly they are paid when they submit bills, the percentage of clean claims they present that are not returned for further information or down coding.
“If you are not doing it correctly, often, you won’t get paid at all.You want to make sure that your company is working your accounts receivable, making sure that they are working hard to collect every cent that you are owed. You want feedback from the billing company in the form of reports on how your account is doing,” Lebow says.
Coleen Campbell, director of business development with Healthquist Inc. says during the process of finding companies they will want to look at a lot of companies will indicate that they have certain specialties and expertise.
“They need look for exactly what their needs are with regards to full services provided. Whether it be just billing, credentialing, renegotiation of contracting, collections…all type of practice management for their centers or practices,” Campbell says.
Campbell says if they do not elect a billing company that has the experience or knowledge of how to go about getting reimbursements in a timely fashion, the decision is a big risk.
“You want to look for a company that is very proactive in going after your appeals, your timely filings. Your coding has to be within the element of what is expected to be seen in an urgent care setting. A lot of times you see too many low codes or too many high codes. You do not want audits to come into your billing arena. You are then under the gun with respect to them looking at every little thing, which will delay your reimbursement and therefore impact, your monthly bottom line,” Campbell says.
Tracy Patterson, principal with Continuum Health Solutions explains that aside from high or low codes, there are other risks involved when going with a third party billing company.
“Just like with any other vendor, you are going to introduce new risks with outsourcing. Billing and collection companies offer a variety of services, and depending on which of those services you end up collecting, those risks can change. For example, they will have access to your PHI, so you will need to make sure that they have proper security measures and safeguard for your security policies and compliance plans. While that third party will increase the number and types of risks, depending on the quality and expertise of both you and the third party, your overall risk may increase or decrease,” she says.
Lebow says the hiring business is also going to want to get feedback from them about the documentation of your providers.
“Are they documenting correctly to get the most for the work that they are doing? A good billing company is looking at your provider documentation and giving you reports such as the range of CPT codes, the different percent levels of not only you as a group, but also individual providers of that urgent care. This way you could know if a provider is documenting and billing too high or too low,” Lebow says.
Buckhaulter adds that while it is important to stay on top of billing teams, the thing that sometimes is the hardest for new practices to get used to is they are switching from an in-house billing team to an outsource.
“If you are the kind of practice that wants to constantly see what is happening day to day, you don’t always have that immediate gratification of response when you have an outsourced biller. Most companies give you someone you can reach out to and ask questions of, but they will not always be on-demand like they would if they were sitting in the desk at your office,” she says.
Lebow concludes that a business should look at a billing company as a partner because they truly are.
“They are paid on a percent of what they collect for your Urgent Care. If you do poorly, they do poorly, but a rising sea level will make everyone’s boat go up. You want to have very good communication with your billing company to make sure you are getting what you want from each other,” he says.
If you have an interest in learning more about the subject matter covered in this article, the M&A process or desire to discuss your current situation, please contact Blayne Rush, Investment Banker at 469-385-7792 or Blayne@AmbulatoryAlliances.com.