01 Apr 5 Reasons to Switch Medical Billing Companies
Learn to identify when it’s time to switch medical billing companies.
The relationship with your medical billing company should feel like a true partnership. After all, you are trusting them with your revenue, cash flow, and patient satisfaction to a degree. When a practice partners with a medical billing company, the practice depends on the billing company’s expertise, workflows, and professionalism to pay staff, keep the lights on, and run a profitable business. With so much at stake, minor disruptions can become sizable problems quickly. When that is your practice’s unfortunate reality use this guide to learn when to switch medical billing companies.
With so much at stake, when do you know that it may be time to change your medical billing company?
The answer to this question is not an easy one. So, when trying to decide if it’s time to change, we recommend looking for the following signs:
1. Your level of service has dropped
When you ask your billing company a question does it take a long time to get answers? Are they responsive to your concerns? Ideally, your RCM partner should be proactive and reach-out if they detect a possible problem or issue, and even better, have a standing appointment with you to check-in and report on your revenue performance. When questions arise, your billing company should respond fully and promptly. You should feel like they are not just another vendor, but a partner focused on your practice.
2. Denials and time to resubmit/appeal is increasing
Denials can happen for a variety of reasons; often times they can be the result of incorrect coding or insufficient documentation. If your denials are increasing along with the time it takes to appeal or resubmit, this can be a critical red flag which may indicate a systemic problem.
According to the American Association of Family Practitioners (AAFP), the average denial rate is between 5 – 10 percent but most medical billing companies including Medusind aim for a denial rate that is significantly lower. Some specialties will fall on the higher end of the spectrum while others will be lower. Your billing company should be as invested in your cash flow as you are. Rising denial rates or a large time lag in responding to denials could mean that your account is no longer a priority and not getting the attention it deserves.
3. Collections are uneven
Are your payments clustered together? For example, most of your payments are posted in the second week of every month, but your patient volumes are steady. If this is the case, there may be delays in claims submission. Quick claims submission is a critical component in the revenue cycle. Delays in submission can be dangerous to cash flow consistency.
Another pitfall of delayed claims is running into timely filing issues. Some payers, particularly those that deal in Workers’ Compensation, can have short claim submission windows. If all the information needed for the claim has been sent to the billing company, there should be no more than 48 hours between information receipt and claim submission.
4. A/R balances are growing
There are few things in revenue cycle management more frustrating than watching your total accounts receivable balances rise month after month. If you find yourself in this position, the time is now to start looking for a new billing company.
A sign that there may be problems in the future is when 0 – 30 day A/R ratios begin to drop. Efficient billing cycles should see ‘front loaded’ A/R meaning that the majority of A/R is in the 0 – 30 day range, followed by the 31 – 60 day range. With electronic filing, some insurance companies will send payment in as little as two weeks. Therefore, high days in A/R is another sign of a problem with your medical billing company.
5. Patient volume is up but not reflected in revenue
Theoretically, increases in patient volume should have corresponding increases in revenue. If your insurance collections are not growing, you have a sure sign that there is a problem. No company gets everything right all the time. However, when it comes to your revenue cycle, an uneven ratio of collections to patient volume means you are losing money. If you are not absolutely sure improvements are being made and change is happening, it’s time to examine other options.
If the time is now to switch medical billing companies let us know
Each of these signs is an indicator of a deep-rooted problem with your current medical billing situation. When it comes to your revenue cycle management, you cannot afford to ‘wait and see.’ For the financial health of your organization, it is essential to be proactive and switch medical billing companies sooner rather than later. In retrospect, you will be glad you decided to change your medical billing.