Expert Tips: How to Identify Red Flags When Outsourcing Medical Billing Offshore

offshore outsourcing medical billing

Effective planning, meticulous execution, vigilant monitoring, and astute management are essential elements for the success of any outsourcing endeavor. When it comes to partnering with a medical billing service provider, the level of effort required may surpass what some practices initially anticipate. Entrusting the billing function to an external firm without proper attention and oversight can lead to dire consequences. While many medical billing providers strive to enhance their clients’ profitability, there are some who prioritize their own interests within the outsourcing relationship, regardless of the potential consequences. If you have made the decision to offshore outsource your medical billing and are currently in the process of selecting the right company, it is vital to be aware to the following warning signs:

1. Lack of Experience

Medical billing providers can offer general or specialized services or a combination of both. The type of provider you need depends on the activities you want to outsource. If you run a private practice with a majority of patients covered by Medicare or Medicaid, it’s best to look for a company that specializes in Medicare billing processing and appeals. Alternatively, if you’re a heart surgeon or work in a similar specialty, seek out a medical biller with experience in processing claims specific to your field. Given that coding and billing regulations frequently change, it’s essential to find an offshore outsourcing medical billing partner who is well-versed in your particular industry segment.

2. Lack of Transparency

Transparency is crucial when entrusting your billing functions to a third party. If a medical billing company’s website only displays positive testimonials and they can’t provide you with a list of clients or contacts they’ve worked with in the past, consider it a red flag. Look for a provider who isn’t afraid to share what previous clients think of them.

3. Inflexible Outsourced Medical Billing Pricing Models

Medical billing pricing models can be percentage-based, fee-based, or hybrid. Percentage-based pricing models are the most common and typically range from 4 to 8 percent of net collections, excluding payer refunds. Fee-based models charge a fixed rate per claim, while hybrid models combine percentage-based pricing for some insurance firms and charge per claim for others. Some areas require medical billers to charge a flat fee instead of a percentage.

Each pricing model has its pros and cons, but the provider should be able to adjust their pricing based on your needs. For example, if you are a family practitioner with lower-margin claims, percentage-based fees may be more appropriate. Beware of companies that offer only one pricing model and look for a provider who can customize their solutions to fit your practice. By doing so, you can avoid overpaying for services that you don’t need or underpaying and receiving subpar services that compromise your revenue cycle management.

4. Poor Communication

Good communication is essential between you and your medical billing partner. Ensure that you can easily reach your provider whenever you need help or for meetings. If they’re difficult to contact, you feel that they’re giving you the runaround, or you’re on hold for extended periods, look for someone else. Physicians and healthcare administrators are busy individuals, and top medical billing providers understand this and the need to provide prompt support. You should have direct access to your account manager and top management through various channels, such as telephone, email, or chat.

It’s also important to have access to your claim information whenever you need it, regardless of whether it’s stored and managed by the medical billing provider. Reports on charges and payments should be provided as actual system-generated reports, not just summaries or snapshots. Beware of medical billing companies that do not provide this level of access to your data.

Additionally, it’s important to know who owns the data when the outsourcing contract is terminated. Some providers may retain ownership to prevent clients from terminating the agreement, so it’s important to clarify ownership and access rights upfront.

5. Poor Medical Billing Data Management

Be wary of medical billing companies that lack robust data protection systems. It’s important to pay attention to complaints from previous clients regarding unauthorized data sharing, even if it’s unintentional. The medical billing provider should have backup and recovery strategies in place in case of a security breach or unforeseen circumstances. Choose to partner with a company that prioritizes the privacy, safety, and redundancy of your data.

6. Lack of Performance Guarantee

When choosing a medical billing company, it’s important to look for providers that offer a performance guarantee to ensure that they will meet your expectations. A guarantee can give you peace of mind knowing that the provider is confident in their ability to deliver high-quality services. Additionally, guarantees can serve as a way for providers to hold themselves accountable and provide motivation to continuously improve their performance.

7. Incompatible Medical Billing or Healthcare Software/Technology

While there is a vast selection of medical billing software options available, not all are created equal. Be cautious of medical billing companies that require the use of specific software, whether it be their own or a third-party option. A reputable service provider will work with you to personalize the necessary technology and offer recommendations that align with your objectives and budget. For instance, integrating software with an existing EMR system can be costly, and certain companies may push you to purchase their exclusive billing software, even if you are not ready to part with your current system. If they fail to offer alternatives, it is advisable to look elsewhere.

8. Deceptive Marketing Techniques

Some medical billing companies use deceptive marketing tactics by advertising very low rates to attract clients. However, it’s important to read the fine print before signing up. Vendors offering low prices often have high revenue requirements, which can make most clients ineligible for the low rates. Additionally, they may only offer limited services, such as one-time claim submission and processing without appeals or resubmission services. This can leave the burden of claims follow-up and unpaid balance collection on the practice, so be sure to choose a provider that offers comprehensive services and transparent pricing.

9. Long-term Contracts

It is generally wise to exercise caution when working with a new billing provider that wants to lock you into a long-term contract. While outsourcing contracts typically run for 24 to 60 months, it is important to carefully evaluate the terms and conditions before signing. Avoid providers that push for longer terms or are not willing to negotiate on the length of the contract. It’s important to have the flexibility to switch providers if the service is not meeting your expectations or if your practice needs change.

Before signing a contract, carefully review the termination clauses to ensure that you can exit the agreement if needed, and make sure that the provider is willing to work with you to make any necessary adjustments to the terms of the contract.

To learn more about outsourcing, you can read our Top 8 Qualities of an Outsourcing Company in the Philippines article. We invite you to follow us on social media and to visit our website to learn more about our service

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