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How Medical Billing Works

For a physician, other medical practitioner, group practice or clinic, how medical billing works can be a daunting task, and can have a major impact on your bottom line. A billing service that does not bill the sessions correctly, misses deadlines, or does inadequate follow-up can have a disastrous effect on your bottom line. However, a well run billing service can simplify your life and greatly improve both your cash flow and total income.

Unfortunately, Medical billing has been promoted by some software companies as an easy way to make money working from home, and some people have set themselves up as medical billers who have little or no experience in the field. It is easy to find horror stories from medical practices who have hired someone who really didn’t know what they were doing. There are a lot of details needed to submit a claim properly so that it will be paid, and if the billing service doesn’t know the intricacies of proper procedure codes, modifiers, place of service codes, etc, the claims will not be paid. Be sure to check out the billing service thoroughly before you sign up!

When you do find a competent, experienced billing service, it can make a very positive change in your life and your practice. You may find that many hours you previously spent each month getting bills submitted or waiting on hold with insurance companies can be better spent seeing additional patients, building your practice, or just spending more time doing other things you like to do. Your cash flow will probably greatly increase as well, as just a few unpaid claims a month can make the difference between a practice that makes money and one that is losing money. Providers often find that a good billing service pays for itself many times over both through many fewer claims that are not paid, and more time available to build the practice and see patients.

Here at Billing Advantage, we provide the best mix of services to help your practice run smoothly. Our highly experienced and professional staff will handle all of your complex billing needs with ease, removing this burden from your hands. You can turn your billing over to us with full confidence that it will be done professionally, accurately, and thoroughly.


Should I Use a Billing Service?

Not every provider should use a billing service. If your practice is primarily self-pay, or if you are only seeing a few patients and you have the time and the interest to do your own billing and prefer to follow up on unpaid claims yourself, then you might do better keeping this in-house. Also, if you are detail oriented and have lots of down-time during the day when you are unable to schedule appointments, it might make sense to do your own billing. However, if you are not especially good with keeping track of details, if you don’t have much down time, if you find you are losing money because of unpaid claims, or if you just plain hate doing the billing, then perhaps you should consider using a billing service. Another point to consider is that it can be very time consuming to keep up with all the regulations and procedures in an ever-changing industry. A good billing service, such as Billing Advantage, will do this for you.


Type of Billing Services and Charges

There are a wide variety of billing services and how medical billing works. These range from small one-person businesses operating out of someone’s home, to large corporations serving hundreds of customers. A few specialize in billing for a particular medical specialty, while most manage all types of medical billing. Some have many years of experience and others are new to the business, and are trying to learn as they go. Most billing services work on a percentage basis, although some charge per claim. In some circumstances, such as taking on a large batch of old, unpaid claims or help in restructuring a practice, some billers will work on a per-hour basis. Typically, though, you will pay a percentage of the claim to the biller. Shop around, as there is a wide variety in rates, but be sure that you look at other factors besides just who has the cheapest rates.

Billing Advantage is a professionally run corporation, serving over 200 providers in 22 states. Our charges are a percentage of payments you have received. We invoice you based on money you have in hand, never the amount you bill out. We don’t get paid until you do.


Typical Procedures

In many cases you will submit the information needed to do the billing by fax, email, or through a web-based communications program. Some billing services offer you the opportunity to enter patient demographics and other information directly into your on-site practice management software. Most billing services have the capability to submit claims electronically, which has become the norm for claims submission. You should probably not consider a billing service that does not offer this option. Medicare especially has been moving towards requiring that all claims be submitted electronically, and actively tries to discourage submitting claims on paper. However, keep in mind that some of the smaller insurances and HMOs do not accept electronic submissions at this time, so some claims will still be submitted on paper.

Billing Advantage offers several different options for you to submit demographic and claims information to us. Many of our customers prefer to enter their data directly into our web-based system. If you choose to work with our partner, Practice Fusion, all you have to do is enter your patient demographic information, and write your progress note as you normally would. We then extract the information needed to submit the claim without you having to do anything further. We also offer several other options for customers who prefer not to use Practice Fusion, or who do not want to do any data entry themselves.


What to look for in a Billing Service 

It is important when comparing billing services to look at what services they are offering for the rate they charge.  Some services will submit your insurance bills and do very little else.  Others will provide a wide range of services such as complete follow-up on unpaid claims, tracking authorizations, mailing bills to patients, tracking co-pays, etc.  Here are some questions to ask when comparing billing services:

  • How long have you been in business?
  • How much experience do you have with billing my particular medical specialty?
  • What are your charges and what is included in this fee?
  • Are there start-up fees?
  • What reports to you provide?
  • Are you HIPAA compliant?
  • What are the procedures for getting information back and forth?
  • What follow-up do you provide after a claim has been submitted?
  • Do you provide electronic claims submission?
  • Do you track authorizations and obtain authorizations when possible?
  • Do you track co-pays and deductibles?
  • Do you provide billing to patients?
  • Can I contact references/current customers?
  • Are there any annual fees?

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