The medical billing service business is an important link between the doctors, health-care providers, patients and insurance companies. Without an efficient medical billing service several doctors and health-care providers would have to wait too long to get their legitimate dues. The same applies to patients. They are fully dependent on medical billing service operators to get their insurance claims processed fast.
The medical service billing business has a wide target market. It includes family practitioners and medical specialists like geriatrics, pediatrics, osteopaths, obstetricians, oncologists, mental health practitioners etc. It also includes social workers, nursing homes, ambulance services, pharmacists, home-health practitioners, medical equipment providers and bionic body parts providers.
The large and diverse market makes it easy for the beginner to start the medical service billing business. You may first target that market in which you have some previous work experience and contacts. If, however, you are new to medicine then you should start by targeting specialist doctors. Also, you should start with small to mid-sized practices.
If possible, you should start your medical billing service business from home. This saves you money that you would otherwise spend on renting an office. You can spend this money on other business necessities like computer system with modem, printer and fax machine, reference materials, phone with voice mail or answering machine, stationery, office supplies and postage.
You also need to buy billing software whose cost ranges from $500 to $10,000. This is a very vital component of your business, and you must spend some time in deciding which software to use. Another important business need is clearinghouse, the name used to refer to companies that transmit medical claims electronically.
You must know all aspects of the medical billing service business if you want to run the operations smoothly. These include entering patient information, name of the referral source or physician, and CPT and ICD-9 codes from the super-bills and day sheets. After this, the electronic claims are transmitted directly to insurance carriers or to the clearinghouse.
The annual gross revenues of a medical billing service business range from $20,000 to $100,000 depending on the size of the business. The first six months are the most difficult. You have to run around clearinghouses and doctors to organize the business.
There are three ways in which you can charge your clients. These are:
- Percentage basis: In this case you charge the health provider a percentage of the money he or she collects per month as opposed to the amount of money billed. The percentage may vary depending on the going rate, the procedures provided by doctors and the patient volume.
- Per claim: This is the preferred method of those concentrating mainly on straight claims billing with little or no practice management tasks.
- Per hour: This is the least popular method. It is used for clients whose billing rate is very low.
The best advertising for a medical billing service business is through the doctors' rumor mill. Also you should be good at networking to get good referrals. Start talking to everybody you know and tell them that you're now running a medical billing service business. Start with your own doctor tactfully. Your doctor may give some referrals and tips on how to approach other doctors. Doctors will pay more attention when you have been to another doctor. Also call all other providers you know directly or indirectly. Start with approaching physicians specializing in an area you're interested in. You can even ask your attorney, accountant, insurance and real estate agent to share their list of physicians with you.