Medical Billing Forum

Starting a Medical Billing Business => Starting Your Own Medical Billing Business => Topic started by: gderilus on September 07, 2009, 05:19:00 PM

Title: Fees
Post by: gderilus on September 07, 2009, 05:19:00 PM
Can someone tells me if I can charge 7% or a flat fee if I have a client that sees about 20 patients a month and they're all returning patients. Would it be better If I charge a percentage or per claims like a flat fee.
Title: Re: Fees
Post by: Steve Verno CMBS, CEMCS on September 07, 2009, 07:37:19 PM
We dont know if your state has a no percentage billing (split fee) law. It might be better to go with a flat fee but go with you gut feeling. Sometimes hard decisions need to be made by ourselves.
Title: Re: Fees
Post by: Michele on September 08, 2009, 06:34:47 AM
If your state is one with a fee splitting law, that will make the decision for you!

But otherwise, like Coding4aliving said, you must weigh both sides and decide what is best for you.  There is no right or wrong.

Michele
Title: Re: Fees
Post by: cardinal on September 08, 2009, 10:33:40 AM
Hi

As I just started my own billing business 6 months ago I am still learning.  I have 2 clients a chiro and a podiatrist.  I am not aware of fee splitting laws.  How do I find out if my state has one?  Is there a website I can reference?  I am in California.

Thanks a bunch
Nancy
Title: Re: Fees
Post by: Pay_My_Claims on September 08, 2009, 10:54:56 AM
Hey Nancy, congrats on your new service and clients. I don't think there is a website, but Linda Walker PMRNC is the fee splitting expert  ;D
Title: Re: Fees
Post by: gderilus on September 09, 2009, 10:00:17 AM
I live in Florida and I think there's a fee splitting law, But I was wondering if I can still charge a percentage even if there's a fee splitting law. I know sometimes it would be better to charge a percentage than a flat fee depend on the provider.

Also when charging a flat fee, do you charge like a specific amount each month or do you charge a fee per claim submitted.
Title: Re: Fees
Post by: PMRNC on September 09, 2009, 10:45:13 AM
Florida is indeed a fee-splitting law state:

The basis for the final order appears in F.S. 458.331(1), which sets forth a list of acts or
 omissions for which the board may take disciplinary action against a physician's license.
The list includes 458.331(1)(i), which prohibits "paying or receiving any commission,
bonus, kickback, or rebate, or engaging in any split-fee arrangement in any form
whatsoever
with a physician, organization, agency, or person, either directly or
indirectly, for patients referred to providers of health care goods and services . .
Title: Re: Fees
Post by: Michele on September 09, 2009, 05:16:08 PM
You can either set it up to charge a flat monthly fee or a per claim fee, whichever one works out better for the situation.

Michele
Title: Re: Fees
Post by: Steve Verno CMBS, CEMCS on September 09, 2009, 07:02:51 PM
IM also in Florida

Two companiea I worked for charged a percentage and they still do.  If you know anything about Florida, I doubt anyone will do anything if they find out you are charging a percentage.

The only thing you cant charge a percentage on is Florida Medicaid.  That is clearly spelled out in the Florida Medicaid Provider Manual.  We took our percentage and determined the per claim fee that is equal to the percentage and that is what we charged.

Good luck
Title: Re: Fees
Post by: PMRNC on September 10, 2009, 05:57:46 AM
I Don't agree Steve, it's not a matter of the state doing anything as it's not illegal for the billing company however if you are in a state that prohibits fee-splitting and you are charging a %, your contract is basically not worth the paper it's typed on, not to mention it's a risk to the provider because it's their ass on the line. I'm in NY and I know that if a potential client tells me they are using a service that's charging them a % I use it as a marketing tool and before the end of the conversation they are thanking me because I was thinking of them. It's just irresponsible to do something you have been shown to be wrong just because everyone else is doing it.
Title: Re: Fees
Post by: Steve Verno CMBS, CEMCS on September 10, 2009, 07:56:55 AM
Linda

My point was Florida is a don't give a crap state.  THis is why we have HMOs getting away with anything that thy want because no one at the regulatory level is willing to do anything to stop what is wrong. Evey day, there is a piece where a company is caught ripping off people.  The State didnt catch these people, the local news did. 

This is why billing in Florida sucks and you have to be aggressive to fight back.  Its high noon here with Gary Cooper all alone on Main Street.  It almost makes you believe that the regulatory people are being paid by the insurance companies, so why go after those paying you.  Everyone in Floida knows Tallahassee is a good ol boy town.  Im from Albany and I know its a good old boy town.
Title: Re: Fees
Post by: Stephanie Kendall on October 22, 2009, 04:05:55 PM
I've searched but can anyone tell me if Oklahoma is a state that you can bill a percentage of collections?  I really can't find it anywhere pertaining to medical billing.
Title: Re: Fees
Post by: Michele on October 22, 2009, 08:57:05 PM
Not sure about OK.

Michele
Title: Re: Fees
Post by: Pay_My_Claims on October 23, 2009, 11:48:04 AM
Why does everyone still want to bill on a % basis??  Do you REALLY feel that you will make more money???
Title: Re: Fees
Post by: MBP on October 23, 2009, 02:26:17 PM
I think it is a very big motivation for billing away, as much as you can, when it is % :) seems to be a very fair way of compensating for billing services to me. you get what you work for. (i, however, respect that it is not legal and dont do it.. ;D )
Title: Re: Fees
Post by: jcbilling on October 23, 2009, 11:13:16 PM
I currently bill all of my clients on a percentage basis, and at this point will continue to until I have a client that is in a state that prohibits that.

When I have met with prospective clients, one of the biggest reasons they choose to hire a billing service vs. an employee is that they feel like they pay the employee whether or not the work is done correctly and promptly. Where as if a billing company is compensated for what they collect, they are more motivated to do a more accurate and efficient job.

I've been contemplating the idea of flat rate, but I'm not convinced it's the most fair way to go.

My question is, what are the benefits of not charging %?




Title: Re: Fees
Post by: Pay_My_Claims on October 24, 2009, 06:48:57 AM
It can also be said (reason why they prohibit fee splitting) is that it is a motivation to upcode, file false claims etc.  As far as them hiring a biling service, there are many that have their own that can't bill or code. They are killing the home-based billing services. When I calculate what I charge as to what is reimbursed by the insurance company each month....I may WAYYY more than anyone billing on 7-8% fee schedule. The average biller in my area makes about 15.00 per hr Which is 2400 a month before taxes. Depending on a physicians revenue she is already making a % of his revenue. If he is bringing in about $30,000 a month she is getting paid 8% If a provider is paying me a flat fee of $2500 a month, he would have to go way above his average for me to lose money doing % billing, but the month he drops down to 20K, I still do well. I don't knock it, but I know % billers lose more than flat fee billers. I have a lot of % billers who get screwed royally
Title: Re: Fees
Post by: gderilus on October 24, 2009, 02:49:25 PM
Wow Pay my claims, I just realized that your business name is almost the same as mine. My company name is AccuMed Billing Solutions, LLC. I'm still working on my website.
Title: Re: Fees
Post by: PMRNC on October 24, 2009, 03:59:50 PM
Quote
When I have met with prospective clients, one of the biggest reasons they choose to hire a billing service vs. an employee is that they feel like they pay the employee whether or not the work is done correctly and promptly. Where as if a billing company is compensated for what they collect, they are more motivated to do a more accurate and efficient job.

This was and will always be an issue, but my response to this very thing is that who care.. who's business is it? I decided a long time ago that ALL of my time is worth getting paid. I have clients in other states where I can bill a % but I choose not to, my time is just as valuable and the practice STILL saves money, everyone wins. But again.. I do not justify what I charge or how I charge. You wouldn't challenge your cable company or your phone company and tell them you want to pay them on a % would you? If you did they would laugh but you'd be told the same thing. These are our rates and this is what we charge. I got tired of billing for just when I collected when it was the fault of the office for not doing their part that led to the lower reimbursement and let's not forget that more than half of what we do is education..not just billing, Every moment of my time is worth getting paid. If a provider does not want to compensate me then he won't hire me and I don't want them anyway.

Title: Re: Fees
Post by: jcbilling on October 24, 2009, 11:11:18 PM
Charlene -

I understand what you're saying about upcoding and falsifiying claims. Although I consider my services very professional and work hard to stay compliant, I realize there are billing services that are just trying to "get rich quick" and therefore give the rest of us a bad name. I guess I have a mental block because I have read so many marketing materials engraving in my head why % billing is beneficial to the provider.

Linda -

You make a good point about not getting paid on the claims that are not the fault of our billing. I have a client who has 3 offices that we bill for. The one office refuses to verify insurance benefits because the receptionist "doesn't have the time" and since the provider is out-of-network, we have so many claims going to the deductible and they don't collect the payment upfront. So the provider is losing money and so am I. I have talked to the provider multiple times about this and he shows no effort to change. It makes me so frustrated, because we spend time sending the claims knowing they won't get paid.

My next question is how do you determine what you charge a client on a flat rate plan? I know there are many factors, such as overhead costs, your time involved with the account, etc. Do you make a itemized fee schedule? Or do you just present a charge and negotiate...or do you not negotiate? 

Title: Re: Fees
Post by: PMRNC on October 24, 2009, 11:37:16 PM
What I do is estimate the time I think necessary for each client on a monthly basis. I then determine my hourly rate (new billers will have this number lower, it should be based on experience, geographic location and education) then I deduct estimated costs and voila! my contract then has a clause that allows me to have a sliding scale so if the provider adds more work, that makes more work for me and I get paid more. It's quite simple but yes I hear you about the marketing stuff being drilled into your head. When I had my billing company setup a few years ago in PA I couldn't imagine charging anything BUT a %, but the more I researched, played the numbers..the more it worked. Then after you arrive at your monthly fee you get used to that way of thinking and you can justify it to the provider who questions it.  For example here in NY it is illegal for a provider to enter into a fee-splitting arrangement, but there are a lot of billing companies who either don't know of it or just ignore it because "everyone else is doing it" When I have a potential client that is using one of these billing companies, I use it as a marketing tool I tell the provider that it's not illegal for me, but for them.. and that my best interest is their practice not just my wallet, that usually sells them or they research and see what I'm talking about, and then they have become educated. 

I don't negotiate.. I used to, but I've been doing this too long to do that anymore. For the first few clients I can totally understand having a bargaining chip or negotiation, but I just don't anymore.
Title: Re: Fees
Post by: Pay_My_Claims on October 25, 2009, 02:02:21 PM
Charlene -

I understand what you're saying about upcoding and falsifiying claims. Although I consider my services very professional and work hard to stay compliant, I realize there are billing services that are just trying to "get rich quick" and therefore give the rest of us a bad name. I guess I have a mental block because I have read so many marketing materials engraving in my head why % billing is beneficial to the provider.

Linda -

You make a good point about not getting paid on the claims that are not the fault of our billing. I have a client who has 3 offices that we bill for. The one office refuses to verify insurance benefits because the receptionist "doesn't have the time" and since the provider is out-of-network, we have so many claims going to the deductible and they don't collect the payment upfront. So the provider is losing money and so am I. I have talked to the provider multiple times about this and he shows no effort to change. It makes me so frustrated, because we spend time sending the claims knowing they won't get paid.

My next question is how do you determine what you charge a client on a flat rate plan? I know there are many factors, such as overhead costs, your time involved with the account, etc. Do you make a itemized fee schedule? Or do you just present a charge and negotiate...or do you not negotiate? 



You would be getting paid if you charged a flat fee instead of %.
Title: Re: Fees
Post by: Pay_My_Claims on October 25, 2009, 02:08:01 PM
What I do is estimate the time I think necessary for each client on a monthly basis. I then determine my hourly rate (new billers will have this number lower, it should be based on experience, geographic location and education) then I deduct estimated costs and voila! my contract then has a clause that allows me to have a sliding scale so if the provider adds more work, that makes more work for me and I get paid more. It's quite simple but yes I hear you about the marketing stuff being drilled into your head. When I had my billing company setup a few years ago in PA I couldn't imagine charging anything BUT a %, but the more I researched, played the numbers..the more it worked. Then after you arrive at your monthly fee you get used to that way of thinking and you can justify it to the provider who questions it.  For example here in NY it is illegal for a provider to enter into a fee-splitting arrangement, but there are a lot of billing companies who either don't know of it or just ignore it because "everyone else is doing it" When I have a potential client that is using one of these billing companies, I use it as a marketing tool I tell the provider that it's not illegal for me, but for them.. and that my best interest is their practice not just my wallet, that usually sells them or they research and see what I'm talking about, and then they have become educated. 

I don't negotiate.. I used to, but I've been doing this too long to do that anymore. For the first few clients I can totally understand having a bargaining chip or negotiation, but I just don't anymore.

I learned from it also Linda. My entire premise of doing medical billing from home is that every provider that I worked for, I KNEW I could do the job accurately and efficiently, and more time effective if it wasn't done in the setting I was in. More often Billers are Practice Managers, or they split their time doing front desk work. I know that if I could only do one provider in 8 hrs, it wouldn't be beneficial to work from home. If I could manage 4 providers in an 8 hr day, and at MINIMAL get paid the same as if I was working in an office (ex 2500 a month x 4 = 10k a month) The providers are happy, they are getting great service for the same or less than an in-house biller, and I get paid in a month what it takes others 4-6 months to make. I win, the provider wins. I really understand the reason behind the % billing, the motivation to do it, but lets be real. A BAD biller is a BAD biller. I don't like sales,and % billing is a sales position. I work each claim regardless of how I am paid because I enjoy my job, and I like to succeed. My knowledge will get me the $$ I deserve.
Title: Re: Fees
Post by: PMRNC on October 25, 2009, 02:17:44 PM
Quote
I don't like sales,and % billing is a sales position. I work each claim regardless of how I am paid because I enjoy my job, and I like to succeed. My knowledge will get me the $$ I deserve.

I COULDN'T HAVE SAID IT ANY BETTER!!    ;D :D ;) ;D
Title: Re: Fees
Post by: jcbilling on October 25, 2009, 02:45:13 PM
You all mention the slidng scale...how does that work? Do you review certain reports every quarter and determine if the fee goes up or down? based on reimbursements? how does that work?

Title: Re: Fees
Post by: PMRNC on October 25, 2009, 04:41:17 PM
Very simple, this might vary depending on the client/specialty, work, etc but I have a set amount lets say 10 for example; for every 10 additional patients added there is an additional charge, again this fee comes from working the numbers to come to my hourly rate. I say 10 because that's about the equivalent of an hours work.. some clients it's 5, some 20.
Title: Re: Fees
Post by: Pay_My_Claims on October 25, 2009, 09:13:17 PM
i do quarterly and yearly reviews.
Title: Re: Fees
Post by: MBP on October 26, 2009, 08:39:22 AM
Charlene, you are talking about how many providers you can bill for in what time. i am new to billing and i am getting faster and more efficient the more i learn, but i still wonder if i am as effective as possible (considering the level of my experience). you said billing for 4 providers in 8 hours, how many claims daily or weekly/monthly, do you take care of? i know if varies by the specialty of the provider but i would just like to get an idea so i can compare my efficiency to a person who has been in the field for a while and is good at it. i cant really calculate my productivity yet as i am still sorting through a mess my provider got into after not having any biller for 4 months and that is very time consuming and confusing.
Title: Re: Fees
Post by: Pay_My_Claims on October 26, 2009, 10:23:15 AM
Yes, it varies a lot depending on volume and specialty and SIZE of clinic. I prefer and really want to move to doing 100% DME billing. I really love that as opposed to medical billing. The time it takes for DME depending on what they ask (claims submissions v/s auth's and submissions) can determine how much time it would take for me to do them. The provider that I work for has 3 companies and is HUGE. If I had to be honest about it and do it from beginning to end, he would be my only provider without help. I would however make the money and make it well because I would be replacing 6 employees. This is how you have to determine cost as well. If you go to a provider and they have 3 billers, I wouldn't want to charge him the same as if he only had 1, that would be shooting yourself in the foot.
I can at minimal work 4 providers of average clinics that are in the gen med specialty. This would be doing full practice management. DME billing, I can manage about 6.
Title: Re: Fees
Post by: PMRNC on October 26, 2009, 08:20:07 PM
here is a tip and it's a good way to not only measure your efficiency but create your very own Policies & Procedures along with a company manual which I think is important in case something were to happen to you.
To start, get yourself a 3-5 subject spiral notebook. Begin logging your time and procedures per client. Do this for about 6 months and review it, you will have a good idea of how much time you are spending on each client as well as where your time can be better spent. Basically keep a diary of everything even phone calls from patients or with your client, that counts as time spent on their account. What makes it difficult to figure out in a standard day is that every practice is different. For example I had a client that only saw patients twice a week so he was only generating 10 claims a week but yet he was terrible at getting his OTR's out, he missed authorizations, when I sat down to figure all this out I found those problems and ways to fix them efficiently so that I only had to spend 2 hours a week on him as opposed to 5 or 6 which was way out of line with his production. When you are all done and within 6 months you also have the beginning of a good policies & procedures guide for your business :)  Makes it easy if you need someone to step in and help or take over someday.. always plan for the unexpected!
Title: Re: Fees
Post by: jcbilling on October 26, 2009, 09:22:22 PM
As always..thanks for all the helpful insight!

Title: Re: Fees
Post by: MBP on October 27, 2009, 08:44:08 AM
Charlene, Linda, thank you both for your insights, great info and advice!!!
Title: Re: Fees
Post by: Pay_My_Claims on October 27, 2009, 11:28:31 AM
Erika,
You are very welcome...
Title: Re: Fees
Post by: MBP on November 05, 2009, 10:14:16 AM
Linda, i read here that you are a fee-splitting guru  ;D i've been trying to find it on black and white for my provider, she was shocked to hear it was prohibited in some states and wanted me to find something about it, but all i can find is florida everywhere! :) i live in ohio and work in michigan, is there a list of states that prohibit fee splitting anywhere online?
Title: Re: Fees
Post by: Pay_My_Claims on November 05, 2009, 12:32:24 PM
Linda, i read here that you are a fee-splitting guru  ;D i've been trying to find it on black and white for my provider, she was shocked to hear it was prohibited in some states and wanted me to find something about it, but all i can find is florida everywhere! :) i live in ohio and work in michigan, is there a list of states that prohibit fee splitting anywhere online?

Oh yes she is the GURU!! look in the archives and all of our "discussions" on this topic..LOL
She is one of the reasons that I know do simply FLAT FEE BILLING!!
Title: Re: Fees
Post by: PMRNC on November 05, 2009, 03:33:54 PM
In our subscriber area we have several resources on this subject along with case summaries and legal verbiage. The states that are clear are NY & Florida, and some states it's prohibited to bill a % for Medicaid. Illinois was one of the states with a prohibition but it was recently overturned.
Title: Re: Fees
Post by: dfranklin on November 15, 2009, 07:03:15 AM
I am very interested in charging a flat monthly fee going forward. Does anyone have a sample agreement they could send me so I can see how to word it for a flat monthly fee?  Particularly one that has a sliding scale option in the agreement?

I would greatly appreciate it!
 ;D
Thanks!
Title: Re: Fees
Post by: Pay_My_Claims on November 15, 2009, 06:02:23 PM
I am very interested in charging a flat monthly fee going forward. Does anyone have a sample agreement they could send me so I can see how to word it for a flat monthly fee?  Particularly one that has a sliding scale option in the agreement?

I would greatly appreciate it!
 ;D
Thanks!

who did your original contract??? The problem with others showing you their contract is, maybe like me, they may have paid a lawyer do one for them and someone gets a copy of it for free. There are plenty of "sample" contracts online. A contract is simply what you want to say put in legal terms.
Title: Re: Fees
Post by: dfranklin on November 15, 2009, 08:53:01 PM
I understand, They don't even have to give me the whole contract...just the wording they used for the flat monthly part.  I actually paid $20k to be part of a group that provided me with contracts etc that were professionally prepared but none had "monthly fee" in there only per fee and percentage.  So I did pay a lot of money for what I have but would love to see how I can modify my current contracts that I already have to include the flat monthly since this is a new and growing way to charge the providers.
Title: Re: Fees
Post by: PMRNC on November 16, 2009, 06:15:23 AM
All your doing is replacing under "payment' within your contract the % with the flat fee. Depending on how you have this setup you might revise the "terms" section as well:

for example:
--------------------------------------------
In consideration for the services rendered by BILLING CENTER, CLIENT agrees to pay the BILLING CENTER the following fees:

All Setup fees are non-refundable and required prior to the commencement of services performed, including the setting up of CLIENTís accounts. The standard Setup fee includes setting up CLIENT and practice into BILLING CENTERís database and with clearinghouse.

The standard Setup fee is $<<Insert Amount>> plus an additional $<<insert Amount>> per patient for setup in BILLING CENTERís database. The $<<Insert Amount>> per patient fee is for each and every new patient that must be entered into BILLING CENTERís database on an ongoing basis.

Fees for services rendered, as outlined within this Agreement, are invoiced at a flat rate of <<Insert Amount>> monthly.

-----------------

Another thing you can do is simply attach a separate fee schedule as an exhibit with all charges, and word your contract like this:

---------------

Rate of Payment for Services. Client agrees to pay Billing Company for Services in accordance with the schedule contained in Exhibit B attached hereto and executed by both Client and Billing Company.

Title: Re: Fees
Post by: Pay_My_Claims on November 16, 2009, 07:02:24 AM
I understand, They don't even have to give me the whole contract...just the wording they used for the flat monthly part.  I actually paid $20k to be part of a group that provided me with contracts etc that were professionally prepared but none had "monthly fee" in there only per fee and percentage.  So I did pay a lot of money for what I have but would love to see how I can modify my current contracts that I already have to include the flat monthly since this is a new and growing way to charge the providers.

20K............waaaaaaaay too much in my opinion. You must have gotten much more out of that group.
Title: Re: Fees
Post by: gderilus on November 16, 2009, 05:33:19 PM
maybe he bought a business opportunity  cause this is a lot of money for a simple contract
Title: Re: Fees
Post by: dfranklin on November 16, 2009, 05:58:27 PM
Yes, when I said to be part of a group I meant to become a licensee which included contracts, agreements, marketing etc.  And yes it still is too much money, knowing what I know now, but I probably never would have known what I know now if I hadn't. So I still feel I made a positive dececision and put me a little farther ahead of the game then I probably would have been if I hadn't.