Author Topic: The age old question of how to set fees for your Billing Service  (Read 3752 times)

HeidiK

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Hi Everybody!

As a medical billing service, I was asked recently what my charge would be "per claim" and I hadn't heard this term in a verrrrry long time!  I reached out to Linda Walker and Merry Schiff who both gave me some insight but I wondered how others in the field might respond to a request like that.

It's a different concept that was used back in the day when an office might only want someone to enter their claims and submit claim electronically.  I believe it was popular when most offices didn't use computers but wanted the quick turn-around for their reimbursement.  Crazy to believe, but that was only in the last 20 years or so! 

Now that pretty much everyone has a system in place, a "per claim" fee is hard to determine because you have to consider what is involved.  I came up with the following levels and wondered if anyone would like to offer their opinion on what you would charge for each level, and if you think other items should be listed or taken out.

TIER 1: CLAIMS PROCESSING   _____ per claim
   Submission of primary, secondary or tertiary commercial claims with required attachments when needed. (Each claim is charged individually)
   Submission of Workers Compensation claims and No Fault claims
   Posting patient and insurance payments for all claims filed
Analyze explanation of benefits statements from insurance companies and verify accuracy of payments. 
   Notification to the office when claim(s) are determined to be rejected, denied or paid inaccurately.
   Claim status review for all claims 35 days past submission date.  (Refiled claims are handled as a new claim submission)
Monthly Patient Statements printed and mailed, office handles patient phone calls

TIER 2: PRACTICE MANAGEMENT    _______ per claim
   All services as listed in TIER 1
   Toll-Free number and secure, encrypted email for patients use regarding any and all questions pertaining to billing.
   Monthly report of claims submitted, payments and adjustments applied.
   Quarterly review and report of Revenue Cycle Management Process
   Review and correction of billing errors when claims are rejected, denied or paid inaccurately and/or query to doctor for additional assistance when needed.

TIER 3: COMPREHENSIVE PRACTICE MANAGEMENT  _______ per claim
   All services as listed in both TIER 1 and TIER 2
   Certified Coder review of records to verify documentation supports claim, query to physician when addendum is warranted.
   Customized design of coding and billing forms and reports.
   Yearly Fee Schedule Review with Coding Updates
   Monthly Eyecare Professional Newsletter with billing, coding and marketing tips
   Discounted rate for subscription to Reimbursementplus.com
   2015 ICD-10-CM Update to System and applicable forms (Training available separately)

ELIGIBILITY AND VERIFICATION OF BENEFITS  ________ per pt/per visit
   Service available separately or in addition to any of the Tiers listed above. Current demographic and insurance information must be provided.
   Active coverage is verified online, and then a live call is made to the carrier to obtain details of patient coverage including patient and/or family deductible, out-of-pocket expenses, material allowances and eligibility.
   Completed EB Form will be sent back to the office prior to the patients scheduled appointment.  Copy should be given to patient when they check-in so they are aware of the full expected payment at check-out.
   Office will be notified immediately for patients who are found to be ineligible for have terminated coverage so other arrangements can be made or appointment cancelled.

I'm looking forward to seeing what everyone thinks, but please include how long you have been "in the business" with your post.  I think it makes a difference and hope to keep this topic informative and helpful.  :)  Thank so much and have an amazing day!
Heidi Kollmorgen, CCS-P
AHIMA Approved ICD-10 Trainer
hdmedicalcoding.com

PMRNC

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Re: The age old question of how to set fees for your Billing Service
« Reply #1 on: May 29, 2014, 02:14:17 PM »
Like we talked about, I don't like the whole "ala-carte" , "per claim" fee, I think it's outdated and has a slight air of unprofessionalism. That is JUST my opinion. Occasionally however we run into those practices that insist on a similar means of paying for services. I think you can be just as creative with this as you can with marketing. My suggestion was to work up pricing based on your time the same way and then determine how to divide that amount as a "per claim fee". This is a hard thing to do if you are new in business because you really don't know what your capable of in regards to productivity, it also depends on the services involved with a claim from start (pre-screening, eligibility/benefit verification) to the end (ZERO balance). To me that is more than just A CLAIM. Claims only processing was big back in the late 90's, it was a means for the office to maintain MOST of the control and data entry and the billing service would submit and post payments. Today's billing company surely has evolved and HAS to be much more diversified in the services they offer in order to compete. The days of just claim submissions is gone. That is one of the reasons I don't like the term "medical biller" to begin with. I refer to myself as a practice management expert/company/consultant.
Linda Walker
Practice Managers Resource & Networking Community
One Stop Resources, Education and Networking for Medical Billers
www.billerswebsite.com

HeidiK

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Re: The age old question of how to set fees for your Billing Service
« Reply #2 on: May 30, 2014, 08:48:06 AM »
Thanks for the input Linda!  My initial reflex is to agree with you entirely.  The more I think about it though, I am starting to see the marketing theory behind it.

Here's an example... If you go to a drive-thru car wash, your choices are clearly spelled out.  Basic is $6, add tires and wax $8 and if you want towel dry and RainX for your windows $9.99.

If a lot of people are like me, they will just choose the basic (mostly because it's probably going to rain within an hour of me driving out!) :)  But later, when you go to a party or you are standing next to your car chatting with a friend, you notice how your tires aren't shining and your car doesn't look sparkly.  Or when it does rain, the water doesn't bead up and wipe away from your windows so you can see clearly.  You wish at that point, that you just paid the extra couple bucks for a better job.

Kind of the same idea with the per claim structure,  give the doctor the choice of a lower cost option to get your foot in the door. Obviously keep track of  how many rejections you had to send back to the office for corrections.  How much time did the process ultimately delay payment?  If you do a good job and develop the relationship, very quickly you will be able to show how the couple extra dollars is worth you doing full practice management.  At least with this method, you have a chance to show you know what you are doing.  If it never comes to that and you end up just doing the basic work, isn't a few dollars per claim better than NO dollars per ANYTHING?

Perhaps it's not something you need to consider as you are established and have references to prove your worth.  Maybe this is an option for newbies or those just starting out.  There is free software out there and lots of ways to do it for minimal cost.

Great discussion!  :)
Heidi Kollmorgen, CCS-P
AHIMA Approved ICD-10 Trainer
hdmedicalcoding.com

Merry

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Re: The age old question of how to set fees for your Billing Service
« Reply #3 on: May 30, 2014, 09:38:42 AM »
Love your analogy Heidi.

DMK

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Re: The age old question of how to set fees for your Billing Service
« Reply #4 on: May 30, 2014, 10:36:59 AM »
Great discussion.  From another point of view, most doctors have no idea the work involved in processing a claim (data entry, submission, follow up, collections).  All they know is a claim is $X.XX income and overhead is taken out of it.  This might catch me flack for saying, but MOST doctors are great doctors and bad business owners.  They don't take into account that a GOOD biller can do the work FAST and EFFICIENT the first time around, which is more cost effective for everyone!

On a personal note, I'm astounded at how long my personal medical bills take to process.  I live in a rural area, and the doctors use billing services from the big cities.  Even electronically, I don't get statements for months for my services.

Michele

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Re: The age old question of how to set fees for your Billing Service
« Reply #5 on: May 30, 2014, 12:28:03 PM »
Great discussion.  From another point of view, most doctors have no idea the work involved in processing a claim (data entry, submission, follow up, collections).  All they know is a claim is $X.XX income and overhead is taken out of it.  This might catch me flack for saying, but MOST doctors are great doctors and bad business owners.  They don't take into account that a GOOD biller can do the work FAST and EFFICIENT the first time around, which is more cost effective for everyone!

How TRUE!  We run into that exact scenario.  The doctors have no clue how much work is involved OR how much money they are losing when they don't have a good biller!

Regarding the per claim fee, we have a couple of clients that we charge a per claim fee but I've never seen a scenario like you described below.  It's interesting.  I can see from a marketing standpoint how it could be useful.  But as a biller of more than 20 years I don't think it would be a good concept.  I feel that the drs would all pick the cheapest method but be disappointed with the service (like your carwash analogy!  :) ).  Then they would think that you (the billing service) were not good.   :-\
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PMRNC

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Re: The age old question of how to set fees for your Billing Service
« Reply #6 on: May 30, 2014, 02:44:11 PM »
Quote
Here's an example... If you go to a drive-thru car wash, your choices are clearly spelled out.  Basic is $6, add tires and wax $8 and if you want towel dry and RainX for your windows $9.99.

This is where we may disagree, lol and that's ok. I just can't compare a car wash with the full on picture involved with Practice management. There is a huge difference between service industry and good/supply.. If I go to the car wash, even if I pick the basic low end price w/out the rain x, and I pull my car through, I already know what I'm getting before I come out. We also certainly can never see attorney's charging "per contract", "Per letter", or "per phone call".. I think our services air just a bit more professionalism.

Again, though, I do understand if you have a practice insisting on a per claim structure, it's easy to just go about your fees the same way, and humor them with a "per claim quote".  But if they are expecting $2 a claim, well, I'd have to question if I wanted them as a client anyway. The Tier pricing would work in this situation, but again, I think it's a lot of unnecessary work to figure it out.
Linda Walker
Practice Managers Resource & Networking Community
One Stop Resources, Education and Networking for Medical Billers
www.billerswebsite.com