Should a Practice Outsource Billing to Prepare for ICD-10 Challenge?

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Outsource Billing to Ready for ICD-10

• Every practice across the country will send out claims based on ICD-10 codes starting October 1, 2015, if they want to get paid for services rendered.

• The updates are massive, as will be the adjustments you’ll need to make to meet this challenge.

• Are you equipped for these workflow changes?

• And is Outsourcing your medical billing only way forward ?

Outsource Billing to Ready for ICD-10

• The following presentation will identify the medical billing challenges a practice faces, and if your practice needs to outsource medical billing to prepare for the ICD-10 challenge.

• Periodically benchmarking certain key performance indicators (KPIs) against industry and specialty-based averages is a tried and tested method of determining what the “better performers” are doing to earn more.

• Here are a few you should test:

Outsource Billing to Ready for ICD-10

1. A/R exceeding 120 days

– The time it takes to get paid for your claims must be provided by your billing team via monthly insurance aging reports.

– A MedicalGroupManagementAssociation (MGMA) benchmarks the 120-day aging bucket for different specialties.

– Compare the MGMA percentages for your specialty with the results at your practice to find if the A/R at your practice is collected slower or faster than the industry average.

Outsource Billing to Ready for ICD-10

2. Cost of appealing denials

– “Cost to appeal denial” by The Verden Group’s CEO Susanne Madden found that appealing an average of 16 denials out of 200 claims/month would cost your practice $7,680/year in time and resources; with each appeal costing $40.

– Dig deeper into this KPI, as your practice could be losing a lot more on appealing denials.

Outsource Billing to Ready for ICD-10

3. Patient Collections

– The best practices send out only two statements for collections, while other practices send 3-5. They also send lesser letters and make fewer phone calls for collections. Which category does your practice belong to?

– Assessing these KPIs will help you gauge your billing team’s productivity, as inefficiency lowers revenue.

– And while these are problems you’re already dealing with, here’s what ICD-10 will bring:

Outsource Billing to Ready for ICD-10

• ICD-10 codes will be complex

– With about 155,000 diagnosis and procedure codes in ICD-10 replacing approximately 14,000 ICD-9 codes, the dynamics of Medical Billing at every practice will change.

– Not only are there a lot more codes that medical billers will need to learn, they are also on a lengthier and more complex format.

Outsource Billing to Ready for ICD-10

• Preparation and impact of the ICD-10 conversion on billing

– Getting paid for claims will require a lot more effort with all these new codes, and this will add up to the existing issues that your billing team is facing.

– Moreover, the conversion will require:

• An implementation team

• Internal awareness and training

• External communication with partners (to assess readiness of EHR vendors, insurance, clearinghouses)

• Internal and external testing of the new codes

Outsource Billing to Ready for ICD-10

• The challenge of transitioning to ICD-10 for every practice will be huge, but the impact will vary based on your current billing methods, preparation for the transition, and the billing team you’ve employed.

• Many are switching from in-house billing departments to professional third-party outsourcing, for efficiency, consistency and security.

Outsource Billing to Ready for ICD-10

• Others are dedicating resources to train their team for ICD-10. However, getting all of this done before October 1, and ensuring that your payments aren’t affected in the process will be a huge challenges

• But what’s best for you depends on the current revenue cycle management processes deployed at your practice.

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