Author Topic: % billing  (Read 4648 times)

QueenAlicia

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% billing
« on: July 25, 2012, 02:55:36 AM »
For those that charge percent do you charge your percent on it based upon what they bill or what they collect?

Michele

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Re: % billing
« Reply #1 on: July 25, 2012, 09:33:41 AM »
When we used % it was on what was collected, but that was the problem.  Not all is collected but the work is still being done.
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PMRNC

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Re: % billing
« Reply #2 on: July 25, 2012, 09:36:57 AM »
You can do either, the bigger question is how your contract is worded. An entire contract can change meanings with a word or two.  Typically you would charge % of ALL revenue.

I agree with Michele, this model is dead in the water, you never receive fair compensation for the work involved. The only one benefiting from the arrangement is the provider. Further if you are in a state that prohibits this, the provider faces sanctions and your contract is Null / Void.   
Linda Walker
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QueenAlicia

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Re: % billing
« Reply #3 on: July 29, 2012, 06:48:19 PM »
I want to do this for everything but the copay.  I don't like percent billing but I am finding them some (such as mental health) may need it if they don't see many patients.  I do agree that you are not getting paid for your time and new billers and providers need to understand this.  It's not about pushing the claims and quantity but it's about the follow up and time.

TammyL

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Re: % billing
« Reply #4 on: August 08, 2012, 03:38:34 PM »
I just read this post regarding % billing and after reading I'm wondering if I need to redo my contract I have always charged a percent on what's collected but never put into considerations on the ones that I bill and may never get paid on especially like deductibles, ins terminated or pre-exisiting cause not all patients respond to there statements let alone pay the bill. But my concern is will a doctor even agree to paying a percent on what's billed and not collected. To them they may feel they paying more on work that hasn't been done yet.

DMK

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Re: % billing
« Reply #5 on: August 08, 2012, 03:58:19 PM »
When we used a billing company, they ONLY did not get a percentage of what I collected at time of service (so patient pay, co-pay ACTUALLY collected, and deductibles ACTUALLY collected).  If they had to bill the patient for it, they got a percentage when it got paid. 

So it was in the doctor's best interest to make sure staff collected what we knew we were supposed to collect, otherwise he gave up a percentage.

PMRNC

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Re: % billing
« Reply #6 on: August 08, 2012, 06:52:18 PM »
When I did percentage my contract was worded in such a way to reflect a % of total PRACTICE REVENUE.  Even if the staff is collecting it, it's same amount of work for me.  I did not charge lower % either, it's all data entry in posting payments and one is not easier than the other so only stands to reason it's same %. Another reason yet I was glad to get away from the % billing model. Provider's wanted to make their own rules on how this was done.
Linda Walker
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QueenAlicia

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Re: % billing
« Reply #7 on: August 08, 2012, 07:00:16 PM »
Yes, they sure do.  Every time I get a call they always say "I only pay 7%" and in my head I say well you continue to pay 7% to someone else who is willing to work like a dog for pennies.  I did a break down of percent one time and I was like it would take me between 30-40 claims to hit $100! Who in the world would want to do all that work and only hit $100 after filing 40 claims?! That does not make any sense.

Now, I do understand that some specialty's have low percentage especially if they get paid by medicaid or something. So in that instance I can see it is better for both parties.

To me it is just not worth it especially when you take in the business expenses and what not.  If the business if formed properly how are you paying yourself working for pennies?

KarenH

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Re: % billing
« Reply #8 on: August 08, 2012, 10:51:25 PM »
My % contract is worded whatever % of all receivables. Percentage billing is rough and providers do like to try to make their own rules. I need to move away from % billing I just have to figure it out and do a flat fee that floats.

PMRNC

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Re: % billing
« Reply #9 on: August 09, 2012, 08:37:29 AM »
If you base your flat fee by a fair hourly rate, you can't go wrong at all.. it works.  And the best part is that when you come up with your flat fee (by using the hourly rate) you don't have to explain it if you don't want to. We already know that MOST physicians are not great business people, they were trained to treat patients and we were trained to bring in the revenue. With this model you get to set your OWN hourly fee and decide what is fair to YOU, the provider STILL saves money because he's getting to write off your costs, not pay insurance, payroll taxes, etc. It's a win win.. So let's say your hourly rate you come up with is $25 bucks an hour.. he still makes out even if he hired an in-house biller at $10-15 an hour.   The formula is easy and even EASIER if you have been billing for a while because you have a good idea how long it takes you to enter how many claims.  there is ONLY one reason people are still using a %.. ONE REASON ONLY!!!....that's to appeal to the provider. There's NO other reason because you do NOT make what you are worth using a %.. EVER. The only one that benefits is the provider.     I think the other reason is strictly laziness or they just don't want to take the time to figure out a better way.  Think about this. many of you still billing this way get paid LESS than Medicaid pays out.. LOL seriously.. I don't mean to be flip but value yourselves a little bit more.   When billing companies begin to all make that professional change, the industry then takes a turn and we'll have less doctors saying "But so and so will do it for 4%".   Your not selling used cars.  Here's how it's done and it's SIMPLE SIMPLE SIMPLE.   

If you want to CHANGE a client from % to flat fee that's the easiest because you have been working with the client and you know how long it takes you to work on their practice so for this example we will say you are going to a flat fee based on $25 per hour.   You know that you spend 15 hours a week on this acct.  That's 60 hours per month @$25.00 per hour = 1500.00   The next thing you do is deduct your expenses FOR THAT CLIENT:  Clearinghouse, postage, phone, fax, ink, claim forms, envelopes etc.  Let's make that expense $350  $1500-$350 =$1150   DONE.   Ah but now you want to know what happens when his practice grows and your time increases?  Simple too.  For a week or two before making the switch set a timer and work on claims for that client, see how long it takes you to input claims for one hour. For example, maybe you can do 10 claims in an hour which allots you some time for a phone call, or research a code, etc, but comfortably you can enter 10 claims in an hour.  There's your sliding fee.  For every 10 new claims sent your rate increases $25.00 (hour) If the practice only has 5 new claims that one month, you note it on the invoice but don't charge the additional $25 until they hit the 10 claims total.    See how simple that is??     

For a new client you can try and do an average for 90 days taking into account their estimated volume and note in your contract that the fee will be adjusted after 90 days so you get a feel for the work involved.    OR you can take their volume and apply the same method of how many claims per hour and give yourself a tiny bit of wiggle room. 

For the brand new biller... obviously you are less experienced and getting $25 per hour is not only not practical just yet but it's not going to do you much good to try and live up to that high of an hourly rate right out of the starting gate.. In that case I recommend going in, $10-$13 above the average salary in your area, that way you still make money, the provider STILL saves money and everyone is happy. Just be sure to have points in your contract to allow for review of fees so you can increase with time an d experience.

Now what to do if the provider wants an explanation of how your charging.   Again, very simple.  You explain that your monthly fee is based upon your time and experience, minus all your expenses. PERIOD.   That's the truth, and you don't have to get into the hourly rate which opens up that door of "negotiations".  What I normally do is feel out the client and usually I can tell if they are shopping.. and if they want to negotiate, so I set my rate just a tiny bit higher to allow them to feel in control to negotiate a little. I might NOT raise that and give them the monthly quote and then offer them a break on the setup fee with a time period to sign the contract.  Feel them out and you can get a good idea of what type of client your getting.   I won't and have NEVER haggled.. never haggle. I have literally packed up my stuff and told the provider good luck and left when that happens. I will make the point that they don't get to haggle with their insurance company over malpractice premiums, or their accountant or their electric company, rental leases, etc.. I'm no different. 

Linda Walker
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www.billerswebsite.com

QueenAlicia

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Re: % billing
« Reply #10 on: August 09, 2012, 12:26:09 PM »
That is so true and we don't haggle with Shell & Arco when it comes to gas in our cars so why shoulld they haggle with us.  It really pisses me off because it's like we are trying to make a living just like they are and they want us to do it for pennies and demand a bunch of work.  I wonder how the inhouse billers feel working for cheap doctors. 

I actually know a doctor who I fired who wasn't giving her employee's benefits.  She treated them like trash and I told them all that they were fools to stay and work for that "you know what explicit that starts with a B".

TammyL

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Re: % billing
« Reply #11 on: August 09, 2012, 03:18:52 PM »
Great Advice Linda I will be using this and get away from the % billing.

Michele

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Re: % billing
« Reply #12 on: August 13, 2012, 08:12:45 AM »
When I did percentage my contract was worded in such a way to reflect a % of total PRACTICE REVENUE.  Even if the staff is collecting it, it's same amount of work for me.  I did not charge lower % either, it's all data entry in posting payments and one is not easier than the other so only stands to reason it's same %. Another reason yet I was glad to get away from the % billing model. Provider's wanted to make their own rules on how this was done.


Wow, this brings back memories.  :) 

Someone accused us (Alice and I) for being "dishonest" for a statement similar to this.  I will forever stand by it.  Nothing dishonest, we didn't hide anything.  We are going to be paid for our work.  The dr was.  Whether his staff collected it or we did, we tracked everything to make sure all was pd and pd correctly AND we provided reports to them to show the TOTAL revenue.  Still can't believe the CRAP that got thrown at us for making such a statement.  :)  Good times....good times.....
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DMK

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Re: % billing
« Reply #13 on: August 13, 2012, 10:12:21 AM »
I agree completely.  I never understood what difference it made it I collected from the patient.  The billing service still had an entry to make.  They still had to (1) enter the charges, (2) enter the payment the patient made at time of service (3) bill the insurance company and this was before electronic billing (4) enter the eob when it came back from the insurance company.  So 4 types of data entry for nothing?  I guess that's why they're out of business now.

PMRNC

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Re: % billing
« Reply #14 on: August 14, 2012, 09:46:48 AM »
Do you know why percentage billing is still done? It continues because of the medical billing courses/training out there who continue to push it simply because it's a "marketing" angle to the provider.  Again, the billing company does NOT benefit from this model at ALL!
Linda Walker
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www.billerswebsite.com