Revenue cycle management (RCM) is one of the most important parts of your clinical practice. It’s also one of the most challenging, especially for small practices with a limited number of staff who are asked to take on a lot during a typical day. Keeping your practice profitable means collecting as much of your billed charges as possible, so for many small and independent practices a better option is to outsource revenue cycle management (RCM) to a third-party vendor. Here are just a few reasons it might make sense for your practice.
1: Manage Growth
As a small practice you may have been able to manage billing on your own, even with limited staff, when your practice was small. As you grow to add new providers, new services, new clinic locations, or more patient volume, that billing can get more complicated. Third-party RCM vendors have expertise in medical billing services for a wide variety of medical specialties and clinic sizes. They also have a dedicated staff of medical billing professionals that they can expand as you grow. You won’t need to hire more staff or provide more training as your needs change.
2: Control Costs
The largest expense for almost any organization—medical practices included—is staffing costs. Hiring a staff member means paying a salary, taxes, benefits, and other costs, and those can add up quickly. If you are struggling with clinic profitability, one of the best ways to cut operational costs is to reduce your staff. Most clinics don’t want to do that on the medical staff side because you want to maintain a high level of service for your patients. Outsourcing your RCM makes a lot of sense to keep staff costs low.
3: Maximize Collections
Healthcare payment models are very unique; you provide a service today, but often don’t get paid for an average of 40-50 days after the service is rendered and you may get paid from multiple sources (one or more payers and patients). The more time that goes by between date of service and payment, the less likely you are to collect the full amount. Practices that have small or inexperienced RCM staff may not be able to focus enough attention on collection efforts to maximize it. If you notice are collecting less than 80% of your billed charges, outsourcing can not only cut costs, it could also improve collections so the overall benefit to your bottom line is significant.
4: Streamline Billing
Medical billing can be complicated, and even small errors can result in denied insurance claims, which shifts the burden of payment to your patients and is frustrating for everyone. An experienced RCM outsourcing company with a good track record for submitting clean claims and getting paid immediately, that also knows how to follow up on denied claims properly, can streamline your services.