It’s probably not a stretch to say that most doctors didn’t choose their profession because they wanted to be successful business people—yet in today’s environment of burdensome regulations, tight profit margins, and a trend toward corporate medicine and commodification of health care, that’s exactly what doctors have to be in order to survive financially. And it’s probably not a stretch to say that most doctors and small practice administrators would rather focus on the activities that deliver better care and overall experiences for their patients than business practices that improve profitability.
It’s tempting to keep activities in-house as much as possible, where there is the perception of more control over the outcome. However, some activities benefit from specialization and economies of scale—and medical coding is one of them. Here’s why:
Most small practices cannot afford to pay for a medical coding specialist.
According to the American Association of Professional Coders, a credentialed coding specialist commands an average salary (excluding benefits) of between $47,000 and $65,000. Add your 25% for taxes and benefits, and you can expect to pay around $75,000 for a qualified coder. Then there’s equipment, workspace—all the things that add up when you bring on new staff.
A coding specialist is worth her weight in terms of improved reimbursement and protection against payer audits—especially when coding violations can easily cost your practice tens or even hundreds of thousands of dollars.
And it’s not just the risk management aspect that a medical coding specialist brings to your practice:
- Coding and documentation requirements can and do change almost constantly, especially under the ICD-10 regime. A credentialed coder is plugged into the system and stays on top of regional and national coverage decisions, payer requirements, and other policy and regulatory requirements that affect medical coding and billing. This ensures that you are coding to the maximum level allowed without putting your practice at risk.
- Improved coding accuracy directly contributes to your revenue. You get the most reimbursement for your time and services and spend less time reworking and resubmitting rejections and denials, which indirectly improves your bottom line.
It’s really not in dispute that credentialed coders and billers are essential to revenue cycle management. But if your practice can’t afford the level of talent required, there are still options.
Related Link: 10 Ways to Improve Medical Practice Profitability and Efficiency
Outsourcing your coding and billing is cost efficient for small and mid-size practices.
When you outsource your medical coding and billing, you get access to this level of skill and professional experience without committing to the high cost of hiring a Certified Professional Coder or Certified Outpatient Coder. You are, in effect, sharing the cost of this expertise with other small practices, giving you all the benefits of in-house talent without the cost and exposure.
It’s a win-win for smaller practices, because third-party coding and billing companies offer you the same (or even greater) levels of transparency and control:
- Real-time access to a suite of custom performance and financial reports, often more sophisticated than internal practice management software packages offer.
- Dedicated billing account managers who make it their business to become intimately familiar with your major payers, patient mix, ancillary services, bundled services—they know your particulars and stay on top of changes that affect your reimbursement. Most have many years of experience in your specialty, giving you access to additional coding and business expertise.
- Performance-based fee structures based on the revenue they actually collect for your practice.
- A layer of protection and expertise in evaluating payer contracts—outsourced billing specialists have deep and broad industry knowledge that gives you an edge when it’s time to negotiate.
If your coding and medical billing performance is less than stellar, or you have questions about how to improve your bottom line with outsourced medical coding and billing services, contact the practice professionals at M-Scribe today for a free consultation.