Effective Medical Billing
Collecting fees for services can often prove futile for the healthcare industry, with the average reported recovery rate falling anywhere from 15 to 21 percent. Retaining a quality Medical Billing Service has the potential to increase those rates by up to 40 percent or more, in some cases.
An experienced Medical Billing Service understands the key to effectiveness in maximizing their collection ratio. The process of collecting medical bills is a complicated one, with complex terminology, a variance in billing procedures, and rigid deadlines to meet. Insurance companies are rarely helpful in this matter, often delaying the process, or trying to avoid the bill altogether.
With these challenges in mind, reliable metrics take on the utmost importance in optimizing collections for Medical Billing. A few key measurement metrics for performance that a good Medical Billing Service should utilize in their tracking and reporting methods include:
Gross vs. Net Collection Rates
Simply put, the Gross Collection Rate simply gives you the percentage of what you charged that you actually collected. This does not include any charge-offs or write-offs, and may result in a lower ration where there is a high payer mix of Medicaid and Medicare. The Net Collection Rate, in contrast, is the ratio of payments to charges once the adjustments due to write-offs have been factored in. This number is an important one, as it gives you an idea of how much you have collected of what you are owed, as well as giving you an idea of how good your Medical Billing Team is performing. A quality, high performing Medical Billing Service should report a ratio of over 90 percent.
Percentage of Past Due Bills and Length of Time in Collections
Tracking past due bills is important, as is amount of time between billing and collections. Past due accounts should be reported in numbers, along with the percentage of accounts that are 30, 60, 90 and 120 days past due. A good Medical Billing Service should be able to analyze and troubleshoot the reasons behind a bill’s past due status, as well as minimize the time between billing and collections
Patient Deductible Collections
It is generally the responsibility of the office staff to collect up front any co-payments or payments required to meet healthcare deductibles. This is expressed in Percent of Patient Liability, which is the ratio of patient responsibility to total billed charges. This particular measurement is a direct reflection of the effectiveness of a practice’s office staff.
First Pass Claims Acceptance Rates
This describes the percentage of claims that are filed that are paid without needing follow-up. A high percentage in this rate is a direct reflection of the effectiveness of a Medical Billing Company.
Insurance Denial Rates
When claims are filed and denied without payment, it is important to identify the reasons as well as troubleshoot the potential causes that might affect future claims. Measures should be taken to keep this number as low as possible.
If you are considering a Medical Billing Service, be sure to ask questions as to how their performance measurement system is evaluated, as well as the process used to deal with any issues that may result in collection delays. Main Street Medical has assisted hundreds of physicians and their practices in becoming more technologically efficient and compliant, as well as more profitable, by managing their revenue through our comprehensive billing service. The healthcare industry is constantly changing and all of us at Main Street Medical look forward to providing technology solutions that can make your practice more efficient – contact us today for more information.