Signs you need a new medical billing company

Signs you need a new medical billing company: the short answer

You likely need a new medical billing company if your A/R over 90 days keeps growing, your monthly reports don’t answer basic questions, denials sit unworked, you can’t get a straight answer when you ask about a claim, nobody explains why denials happen, or your contract makes it hard to see your own data or leave. Any one of these is worth a conversation. Several together usually mean the arrangement is costing you money every month.

1. Your A/R keeps growing

Aging A/R is the clearest sign. If the share of your receivables older than 90 days is rising month after month, claims are not being worked to a result. Older claims are harder to collect and some will pass the payer’s filing or appeal deadlines and be lost for good.

Watch days in A/R and the share of A/R over 90 days, broken down by payer. Our guide to days in A/R benchmarks explains what to track. A billing company should be able to show you these numbers and explain any change without being asked twice.

2. You can’t follow the reports

A good monthly report tells you what was billed, what was collected, what was denied and why, and what is still outstanding by age and payer. If your reports are long, full of totals with no explanation, or change format from month to month, you can’t hold the company to its results.

Ask yourself whether you could answer these questions from last month’s report:

• How much did we collect, and how does it compare with what we expected?
• What is our denial rate, and what are the top reasons?
• How much A/R is over 90 days, and which payers is it with?
• What was written off, and who approved it?

If you can’t, ask the company to explain. If the answers are vague, that is a sign in itself.

3. Denials sit unworked

Every practice gets denials. What matters is what happens next. If you find denials that were never appealed, claims that were resubmitted unchanged, or balances that were written off without your approval, revenue is being left behind.

Ask how quickly denials are worked after they arrive, who works them, and how many are still open. A billing company should work every denial to a result: paid, corrected, appealed or closed with a documented reason. Our guide to reducing claim denials describes what a good denial process looks like.

4. Nobody explains why denials happen

Appealing denials one at a time is only half the job. The other half is finding out why they keep happening and fixing the cause. If the same eligibility, authorization or coding denials come back every month, and nobody has told you what to change at the front desk or in documentation, the company is treating symptoms.

A good billing partner groups denials by root cause and tells you plainly what needs to change and who should change it.

5. You can’t get a straight answer

When you ask about a specific claim or patient balance, you should get an answer within a reasonable time from someone who knows the account. If emails go unanswered for days, you are passed between people who don’t know your practice, or answers change depending on who you ask, the company doesn’t have enough attention on your account.

Patient complaints are another warning. If patients call your office confused about statements, or say they never received one, the billing process is reaching them badly.

6. Collections drop while visit volume holds

If your providers are seeing the same number of patients but collections are falling, something in the revenue cycle has broken. It could be a payer change, a coding problem or a credentialing lapse, but your billing company should notice it before you do and tell you what it is.

7. The contract works against you

Read your current contract carefully. Warning signs include:

• No clear access to your data. You should be able to get your claims, payment and A/R data at any time, in a usable format.
• Long notice periods or exit fees. These make it expensive to leave even when service is poor.
• Unclear tail terms. Find out whether the company keeps charging its percentage on payments that arrive after you leave, and for how long.
• Vague scope. If the contract doesn’t say who works denials and old A/R, those tasks may simply not be done.

Our guide on how to choose a medical billing company covers what a fair contract should include.

How to switch billing companies without losing cash flow

The biggest risk in switching is a gap where nobody is working claims. A careful handover avoids it.

1. Get your data first. Before giving notice, confirm you can export your claims history, open A/R, payment history and patient balances. Make sure you have your own logins to your practice management system, clearinghouse and payer portals.
2. Read the notice and tail terms. Know exactly when your current contract ends and what the outgoing company is responsible for after that date.
3. Agree who owns the old A/R. Decide in writing whether the outgoing company keeps working claims it submitted, or whether the new company takes them over. Ambiguity here is where money is lost.
4. Run a short overlap. Have the new company start on new claims while the outgoing company finishes its work, with a clear cutoff date for charges.
5. Update payer and clearinghouse settings. Check that remittances, electronic funds transfer and clearinghouse reports go to the right place after the switch.
6. Watch the first 90 days closely. Track claims submitted, payments received and denials each week until the new process is stable.

What a good billing partner looks like

When you compare replacements, look for the opposite of every warning sign above. A good partner gives you a monthly report you can read in a few minutes, works every denial to a result, explains the root causes and tells you what to change, answers questions about a claim quickly through a named contact, and offers a contract that lets you keep your data and leave on reasonable notice. Ask each candidate to show you a sample report and describe exactly how they would take over your open A/R.

Before you decide, get a baseline

Switching is a big decision, and it should be based on numbers rather than frustration. A clear picture of your denials, aging A/R and collections tells you whether the problem is the company, a process inside your practice, or both. Our A/R recovery service can also take on aged claims during a handover so they don’t fall through the gap.

Request your free A/R audit and we’ll review your recent claims and show you where revenue is being lost. You keep the findings whether or not you work with us, including if you use them to fix things with your current company.