| dy"> | | | | Total Cost of Outsourced Billing (at 8%) (TCOB) |
| The single biggest mistake doctors make is | | | | · TCOB = Total Insurance Collections X |
| forgetting to calculate what it will cost them to | | | | Billing Company Fee |
| manage the staff they hire to do billing in house. It | | | | · $432,000 X .08 = $34,560 |
| is one of the golden rules of business. Pay | | | | FAQ |
| yourself first. There are other hidden costs when | | | | Q: What if I found one super biller that could work |
| it comes to managing a billing team as well. The | | | | 20 hours per week they can get it done? |
| numbers below are based on numbers that were | | | | A: You would still need to manage that person 2 |
| given to the doctor from a very well know | | | | hours per week and it is not worth the time. |
| chiropractic coach, not numbers I came up with. | | | | Your staff salaries would drop to $15,600, but |
| · Projected number of weekly patient | | | | you would still be paying yourself $48,000, giving |
| visits: 500 patient visits/week | | | | you a total of $63,600 or 14.72% of insurance |
| · Projected Total Collections(TC): $60,000 | | | | collections. You would not be under 8% until you |
| month x 12 = $720,000/year | | | | spent less than 45 minutes per meek managing |
| · Total Insurance Collections (TIC): 60% | | | | one part time person to do billing for a 500 per |
| insurance = $432,000 | | | | week office. |
| Total Staff Cost (SC) | | | | Here is what you should be asking: |
| · Staff hours per year (SHY):o 3 part | | | | 1. Can one part time person handle the billing for |
| time staff = 3 x 20 hours/week = 60 hours per | | | | an office seeing 500 patients per week? Claim |
| week x 52 weeks = 3120 hours/year | | | | submission, EOB posting and follow up? |
| · Average hourly rate (SHR):o $15/hour | | | | 2. Since this person is not paid based on a |
| · (SC) = (SHR) $15/hr X (SHY) 3120 | | | | percentage will they really fight for every dollar? |
| hours = $46,000 | | | | 3. What happens if they are out sick for three |
| Management Cost (MC) | | | | days? |
| · Doctors hourly compensation (DHC)o | | | | 4. What if they get a better job? How will you |
| Hours worked = 30hrs/wee X 52 weeks = 1,560 | | | | find the time to replace them? |
| hours/yearo Total Collection = $720,000/yearo | | | | 5. Will they be attending seminars to learn the |
| DHC = (Total Collection) $720,000 / (Hours | | | | latest in coding? |
| Worked) 1,560 = $461/hour | | | | 6. Will they be processing thousands of claims per |
| · Hours spent managing billing staff | | | | month like a professional billing service would and |
| personally (HS): 2 hours/week x 52 weeks = 104 | | | | be able to analyze data to make sure they stay |
| hours/year | | | | ahead of the insurance companies? |
| · MC = (HS) 104 hours/year X (DHC) | | | | 7. Will they give you compliance reports showing |
| $461/hour = $48,000 | | | | you exactly when you raise a red flag for an |
| Total Cost for in house billing (TCIB) | | | | insurance audit? |
| · TCIB = Staff Cost (SC)+ Management | | | | 8. Will they provide real time reports and accurate |
| Cost (MC) | | | | call logs on every claim so you can check their |
| · TCIB = (SC) $46,000 + (MC) $48,000 | | | | productivity at any time? |
| =$94,000 | | | | 9. What if insurance collections go down? Will your |
| TCIB as a percentage of collections (TCIB%) | | | | staff take less pay? |
| · TCIB / Total Insurance Collections = | | | | 10. Would an in house biller agree to a percentage |
| TCIB% | | | | of collections as compensation? |
| · $94,800 / $432,000 = 21.94% | | | | |