The decision whether to hire a professional billing service or to keep billing and collections in-house can be a tough one for physical therapists. Naturally, you want to keep your expenditures as low as possible so that your clinic’s bottom line stays healthy. That’s why your first instinct may be to do billings and collections in-house to avoid paying service fees. But more often than not, this decision turns out to be the more costly one.
PT Billings and Collections Options
For you and your team in PT practice, taking good care of patients and looking after billing and collections in-house is a huge juggling act. Over-commitment results in under performing in all areas and is a straight path to burn-out, high turnover, and expensive mistakes. Hiring a billing clerk is another option. But let’s call a spade a spade. An in-house billing operation in the hands of a general administration staff member is, for all intents and purposes, like having an amateur doing a job that requires professional standards of education and training. It’s a complex and multi-faceted job. PT billing and collections involves always being up-to-date on specialized terminology, perplexing codes, complicated forms, and intricate processes imposed, and frequently changed, by insurance companies. It’s a profession all on its own.
What’s at Stake?
An in-house biller/clerk is almost never able to keep up with all the changes to payer regulations and rules, with checking benefits, with filing completely error-free claims in a timely manner, with posting payments, with following up on and resolving denials, and so on. The result? Your revenue stream slows down to a trickle, placing your clinic at risk. By hiring a professional billing service, you get an entire team of dedicated billers and managers working for you and providing you with an array of services designed to maximize your claim reimbursements. They make sure there are no errors or loopholes in submitted claims or other documentation that can be used as reason to deny reimbursements or shortchange you.
Higher Reimbursements More Than Pay for Themselves
This kind of an error-free performance requires in-depth knowledge of the insurance industry as well as PT billing and collections. While you might initially see the expense of paying for this experience, doing so can significantly increase your reimbursement amount per claim. You get more claims done right the first time. Thus, hiring a professional billing service can recoup more than you spend. The higher the average reimbursement, the better for your bottom line. Meanwhile, doing it in-house almost always results in lower reimbursements and more time wasted on follow ups.
The Net Benefit
In the end, how cost effective is in-house billing, really? You have to pay salary and benefits to the person hired to do that job. A conservative estimate of your expenditure here is about $30,000 to $40,000. On the other hand, assuming an annual revenue of $250,000, your cost of hiring a professional billing service is approximately $17,500 (fees estimated @ 7% of collections). The cost/returns calculation regarding the management of your PT billing and collections ultimately comes down to a binary choice: paying out more in payroll expenses and getting a more “amateur” performance that garners mediocre revenues, or paying less for a professional billing and collection service that maximizes your revenues. Hiring a professional billing service simply makes sense. Creative Commons Attribution: Permission is granted to repost this article in its entirety with credit to Jet PT Billing and a clickable link back to this page.Tags: hiring a physical therapy billing service, hiring a professional PT billing service, hiring a pt billing service