Starting a Medical Billing Business > Starting Your Own Medical Billing Business
Set up Fees
PMRNC:
I never used a software with a per client or setup fee but a lot of your ASP models are charging them and it's an understandable charge and up to industry standards today. I would say if you are being charged a setup or per client fee by your vendor it stands to reason to collect that as a setup fee. I never did refundable deposits because again, it really takes a lot of time and effort in setting up a client/practice and I believe you shoudl be compensated for your time as well as setup costs your vendor puts on you. For example if your vendor is charging $300 per practice setup (one database) your setup fee should at LEAST be this amount. If it were me I would charge that on TOP of my setup fee and maybe offer a discount giving them a sense of urgency to "sign" on the dotted line <g>
My setup fees ranged from $200 -$2000 depending on what I found after doing a complete practice analysis which consisted of analyzing reports (I try to get 6 months worth) such as A/R, Procedure codes, denials, managed care adjustments, etc. Also I took into account the services they wanted, sometimes full practice management for me meant maintaining managed care contracts and credentialing.. other times it might have been A/R clean-up only.. always think outside the box. Your setup fee can also tell you a lot about a potential client whether you realize it or not. The ones that balked or complained about it usually meant they were after something for nothing. With my first few clients I "cut" my deposit and let them know I was giving them a discount, but I never waived it completely.
Linda Walker - PMRNC
http://www.billerswebsite.com
Anne:
I just read here with interest because I was recently asked to do billing for a new client. I bill now for two PT/OT Groups (home business). I never charged any start-up fees because we all started this together - me as the biller and them doing the treating of patients - just a few patients to start - now it's grown and I've upgraded my software and now billing electronically. This new opportunity just happened - word of mouth - I didn't go out looking for more business. But think now I'm ready to take on more business. However, I just spoke w/ office manager once but evidently billing person they had before "messed things up" - I don't know how badly or exactly what all will be involved in the "clean up" but willing to take it on. There are two of us now doing billing in my business. Anyway, my question is: is there a guideline of some sort to determine how much to charge for clean-up - depending on size of practice?, how many claims per week?, how many months back clean up will involve?.
Also, I charge providers that I already bill for, 7% of collectibles - was willing to do that since, as I said we started small and I appreciated them giving me the opportunity. Now with this new client, if it works out as I'm thinking, will be different and I'm not sure if 7% is enough, or does that sound reasonable, or if I should charge a different way? Also, I don't have a contract w/ my providers. Is there a place to look for a standard type of contract?
I know a lot of questions here - I have more even :) but this is for starters. thanks, Ryanne
Michele:
There are no set guidelines for doing cleanup. You just have to decide what you will do and how you will charge. First I would pick a set date I'm willing to go back to, like June 1, 2008, or maybe even 1/1/08. Some will be denied due to timely filing, but some plans allow a long time. Many times clean up just involves billing the claims out and it's really no different then regular billing, just older dates. It depends on how the previous biller 'messed things up'. We did this for an account once where we submitted the old billing and most of it was just paid on the first time around. There was no extra work for us. We just added the clean up in with the regualar billing and charged the same amount. It was a large account and we wanted to establish a long term relationship with them so we let them know we were doing it as a favor.
If the cleanup is going to be more intense then you should find a way to bill for it separately and get a higher fee.
Your fee really depends on a lot of things, where you are, what type of specialty etc. 7% is around the going rate, you will find some services who charge more, but some who are charging less. I wouldn't recommend going less than 7% no matter where you are in the country.
I have not been able to find a sample contract. Some have offered on this forum to show one, but it has never seemed to surface, not sure what happened. Anyway, we have a very simple contract that our lawyer looked over and approved. It is very basic and covers us both for HIPAA, explains what we will do, what we will get paid, and when the provider should pay us. It has worked for us for 15 years.
Michele
Anne:
Thanks Michele, Your answers were as I expected - mostly - "it depends". My business partner and I are going to meet w/this new client next week, so will probably have more specific questions at that time.
thanks, Ryanne
MedicalBillingCourse:
My beliefs on this are in line with Linda's. There has never been a time that I have not charged a set-up fee. Not only does the fee pay you for your initial set up time and work, but the fee is also a great way to get your prospective client "off the fence" and on to "signing your contract" by offering a discount "if the contract is signed by XX/XX/XX date". :)
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