Healthcare is an industry in an ongoing state of flux. In October 2015, the use of ICD-10 billing codes became mandatory in the United States. This created a major transformation in billing procedures for medical providers ranging from a solo physician office to mega-hospitals. The number of codes available to medical billers when they used ICD-9 was about 13,000. With the implementation of ICD-10, that number exploded to about 68,000 procedure codes.
While the change was made to allow for greater specificity when coding medical procedures and allow for public health officials to track illnesses and injuries, some are simply ridiculous. For example, ICD-10 code YD: V91.07XD – Burn due to water-skis on fire, subsequent event, or ICD-10 code V97.33XD: Sucked into jet engine, subsequent encounter.
The advent of ICD-10 exacerbates the approximately 30,000 shortfall of medical billers as well as creating a level of detail that might leave some scratching their heads. This shortage and the renewed emphasis on detailed billing makes for a solid business case for outsourcing medical billing.
Benefits of Outsourcing Medical Billing
Outsourcing is a word that entered the American lexicon as a practice where jobs were performed in countries with much lower labor costs. But, medical billing outsourcing is usually done by a firm in the United States. For medical and health providers billing as an outsourced service helps providers in a number of ways.
- Medical billing companies have well-trained billing staff who often have access to ongoing education and information about ICD-10 billing.
- Since billers have extensive training, the number of rejected claims and claims returned for additional information is significantly reduced.
- Billing errors related to ICD-10 cause delays, sluggish claims processing, less timely appeals and follow up, and an overall reduction in revenue cycle management.
- Billing companies file appeals on a timely basis. Secondary carriers and individual deductibles and copays also have follow-up leading to an improvement in revenue cycle management. Write offs for small balances becomes the exception rather than an everyday occurrence.
- When revenue cycle management improves so does cash flow with a result of more revenue going to the provider’s bottom line.
ICD-10 is a strong enticement to outsource medical billing for providers, but there are other advantages too.
More Benefits of Medical Billing Outsourcing
Surveys have historically reported that providers choose to outsource medical billing for many reasons including:
- Cost-savings as determined by net costs. Cost avoidance for computer hardware, billing software, billing personnel and other attendant costs for in-house billing are avoided.
- Improved patient satisfaction with clear and complete statements reduces phone calls to the provider for an explanation of a bill. Many billing providers include their phone number for billing inquiries.
- Allows providers time to give to other issues. Also, let’s providers have more time for diagnosis and treatment.
- Billing staffs take up space that can be used for patient care, a more beneficial use to providers as more space may mean more patients.
- Allows patients choices for paying bills — this may be at the point of service, over the phone, through provider’s web portal and more.
Providers who outsource patient payments and billing communications find they have a strategic advantage in speeding up the patient payment system. Not only do billing partners take care of all billing issues related to ICD-10 coding, they also enjoy lower costs, gain a better understanding of their cash flow, give patients multiple choices for paying bills and improve staff productivity. All these factors serve to bolster a provider’s bottom line.