The topic of outsourcing a chiropractic office's billing brings up much controversy in chiropractic circles. Although, there is no right answer for everyone, let's take a look at the issue in detail to find the best answer that may suit you.

The Issue of Control
Chiropractors who are big fans of keeping billing in-house typically cite "control" as a factor of why they are in favor of in-house billing. While it may appear that you have more control over your billing by having an employee who works in your office handling your claims, your employee may have too much control.

That is, they can get to know patients and let overdue accounts slide. They can dislike certain tasks (calling attorneys, for example) and decide to ignore them. One of the biggest negative of in-house control is the fact that when your biller is sick, goes on vacation or is doing less than a stellar job, they have effectively controlled your ability to get paid. "Control" is not always a good thing.

Are Employees More Sensitive to Patient Concerns?
Another common reason that I hear in defense of in-house billing is that they wish to be more "sensitive" to patient concerns. Yes, it is true that an outsourced biller who is paid on a percentage of collections may not really care whether Ms. Jones can truly afford her co-pays, mainly because the biller does not know the patient. Billers want to collect - period. And when Mr. Smith's claims go straight to the deductible, again, the billing agency wants to be paid.

Again, look to the bottom line here before you conclude that you need this sensitivity from your billing department. Generally, these are the exact types of situations that will get you into accounts receivable trouble in the long run and are easy temptations for the in-house biller who wants to be liked. Down the line, the little incidents that your in-house billing employee has let slide will cost you money.

Still On the Fence? More Reasons to Outsource!
Given the requirements of today's billing processes, it takes the specialized skill of a medical billing professional to be successful and compliant. Billing should not be something someone does to fill in the time between scheduling patients and pulling their charts.

A decade and a half ago, billing was much simpler. Payers changed the rules once a year and informed practices in plenty of time so they could adjust their processes. Denials averaged less than five percent of total claims. Today, it's not unusual to have a 30 percent or higher claim-rejection rate, which requires extensive follow up.

The challenges that internal billing operations are faced with on a regular basis can lead to collection shortfalls or non-compliance.

Here are some more reasons why outsourcing to a billing company makes sense:

• Regulations change constantly, which means that dedicated personnel must be assigned to read bulletins, interact with payers, and attend industry seminars.

• In large organizations, Billing and Coding are separate departments. Most chiropractic offices don't have the resources to dedicate personnel who have the responsibility for ensuring that documentation and coding is compliant with federal regulations should also be certified by one of the accredited organizations. Outsourcing may enable you to achieve this.

• Implementing and maintaining a compliance plan can be expensive for an individual practice; with a professional billing company, the cost of a compliance plan and the compliance officer can be spread across many clients.

• Technology is a huge cost center for an individual practice. For example, in addition to the initial purchase price of payment-tracking software to ensure proper payment according to the appropriate fee schedule, there is the ongoing cost of keeping payment tables accurate. Denial management tools are also required to track and eliminate the root cause of why denials are occurring in the first place.

• Lack of follow-up relating to unpaid claims is the single biggest problem I encounter when consulting with most chiropractic clients. Follow-up is burdensome and time consuming. Because it seems to be the last thing folks get around to, it leads to lost revenue due to the various payers' "timely filing" requirements.

• It is getting harder to attract and retain competent billing personnel. The Society of Human Resource Management states that the cost of recruiting, hiring, and training a new employee is $3,500. Utilizing a professional billing company eliminates this expense in its entirety.

• Professional billing companies offer economies of scale, which makes their services less costly than if a practice tries to run its own internal operation.

When Outsourcing Does Not Make Sense
As I stated at the outset, I do believe outsourcing makes sense most -- but not all -- of the time. Typically, outsourcing may not be the best choice from a financial perspective if your chiropractic practice is at one of two extremes.

For tiny practices who have very few patients or for practices that are mostly cash-based, outsourcing may appear expensive and time consuming rather than just doing it yourself or in-house. Use caution here to make sure you or your employee know what they are doing before coming to this conclusion.

The other extreme is very large practices. The typical percentage an outside billing company may want as a fee for their service may not make financial sense if the practice has a qualified employee(s) who may be able to be amply compensated to do billing full-time.

Again, use caution here in not trying to save too much. Sure, you can probably spend less on your employee's salary than you may have to spend with an outside billing company. However, remember the issue of follow-up. Is your staff going to be able to handle it? If not, the extra money is worth it.

KEEP YOUR GOALS IN MIND
When looking at the big picture, it is important to keep the ultimate goal in mind.

For most, the goal of any chiropractic billing company is to maximize collections and ensure compliance. With the plethora of regulations that now affect billing and collecting, practices need full time professionals to handle their billing.

Today most chiropractors are working harder than ever before and making less due to additional regulations and declining reimbursement. The question they should be asking is, "Why should I have the additional burden of running a billing operation?"

As you can see, there are many good reasons to outsource your chiropractic billing and, likely, the scales are tipped in favor of outsourcing. Either way, now you can make an informed choice!



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