How does one go about determining if their medical billing service is getting the job done? Here are some specific metrics and guidelines:
#1 – Are you receiving payment for all of your claims?
We all want to get paid for the work that we do, but what can you reasonably expect from medical billing?
The goal should always be to aim for 100% of your claims being paid, but if you are actually coming in at around 96 to 99 percent, then you are doing okay. By that I mean the percentage of money from claims rather than claims paid. The reason being that if all you are receiving are payments for smaller claims, then you will be missing out on the high-fee claims that will help push your money percentage up to where it needs to be. The healthcare system that we work in is far from perfect, so a realistic goal is to reach 98% of money from claims.
Anything under 95% should raise a red flag.
If you are sitting at 94%, then it’s not necessarily time to ring the alarm bells, but you should be taking a closer look at your reports to see why your number is so low.
If you drop under 90%, then it’s time to panic. All of your claims will have to be seriously evaluated as it would seem that you are doing something very wrong.
This just highlights the need for a reliable reporting process and how you can lose money without one. It’s not entirely uncommon for a practice to recover less than 90% of the money they are owed, but many of them fail to even notice.
That leads us very nicely to the next question that has to be asked:
#2 – Do you know which claims have been paid and which haven’t?
There are always going to be claims that go unpaid, each of which will have a different reason for being that way. It’s important to have a firm understanding of the most common reasons why payment isn’t made.
Those reasons can include: A client that has switched insurance, but forgot to get pre-authorization. It may also be that the client had a deductible, but simply neglected to pay the final bill.
If you are not aware of the different reasons that could be at the heart of many of your unpaid claims, then chances are that you are missing out on money that is rightfully yours.
If you have a person who is responsible for all of the billing, then they should be able to detail the status of every claim, paid or outstanding.
If you have no idea why a claim remains unpaid, that’s a red flag!
If you can’t tell what claims have or haven’t been paid, then it’s time to hit the panic button!
#3 – What is your DRO (Days Receivables Outstanding)?
The rule of thumb is that you should receive payments due within 45 days. You will find that some insurance companies will pay out much quicker, but they are within their rights to wait the full 45 days.
One of the most common reasons that claims take longer is because they were not submitted in a timely fashion. All of your bills should be submitted several times a week, with any less than that only giving rise to possible delays.
Another reason that causes claims to be delayed is when they are submitted to the wrong managing company. Insurance companies will oftentimes have some of their services managed by a different company. Submitting the claim to the wrong department doesn’t mean that you won’t get paid, but it does mean that it will likely make the departmental rounds before the money is final sent out.
If your DRO is beyond 60 days, that’s a red flag!
Anything after 90 days means it’s time to hit the panic button!
It doesn’t matter if you do all your own billing or work with a medical billing company; you have to remember 3 things:
1. Don’t fall for excuse after excuse
2. Get as many specifics as possible from your biller
3. Automate all of your reporting; you will find that there are numerous systems on the market that can help you, no matter how big or small your practice is
We make it our priority to make sure that your medical billing runs smoothly.
We had our own medical practice for many years, and during that time perfected the billing process to the point where we felt we could help others. With that in mind, we are delighted to offer you full service billing that will save you both time and money from the very moment that you trust us with your billing.
Please feel free to call us so that we can answer any questions that you may have. 1-855-4-THRIVE or visit our Medical Billing Website!