When it comes to collecting payment from insurance companies, the decks are stacked
against the medical provider. Insurance companies have the clout to control the
billing process, putting practice owners at a distinct disadvantage. Medical
billing networks, a new approach to outsourced internet billing, promise to level
the playing field by allowing providers to achieve the same economies of scale
as the payers.
Medical Billing Today
The current Byzantine system allows insurance companies to set up countless
hurdles blocking payment, in the form of procedures, codes, and rules. Dr.
Sigmund Miller, executive director of the Association of New Jersey Chiropractors,
points out that, at the expense of medical providers, payers are benefiting
from the increasing complexity of billing procedures.
Common insurance company strategies to prevent timely collection include:
- Complex procedures and coding rules. Payers take advantage of individual
practitioners unreliable billing practices, which lead to bureaucratic errors
About twenty percent of medical bills go unpaid as a result of bureaucratic
errors and poor provider follow-up. Coding errors are the basis of the claim
denials and payment delays that can decimate a practices collections.
fees. Insurance companies also leverage their scale to reduce allowed fees
through consolidation. Medical
billing service expert Yuval Lirov explains
that insurance industry consolidation has reduced competition for physicians
services, resulting in providers being paid less.
- Post-payment audits further
reduce collection rates. Again, the payers size contributes to their clout
in demanding refunds. Operating with a
database, insurance companies possess a reliable record on which to base
In these three respects, insurance companies are able to leverage their size
and efficient billing system to limit payments to medical providers.
The Advantages of a Medical Billing Network Service
Individual medical providers have little recourse against these tactics. Collectively,
however, medical practices can achieve enough influence to remove some of
the hurdles to bill collection. Medical
billing networks boast several key
advantages for practitioners:
- Improved collections
- Lower audit risk
- Efficient practice management
- Added revenue sources
How Does it Work?
billing services offer a mechanism for individual practices
to band together. These services leverage the data of all clients in an accountable
and efficient automated system. Insurance companies, explains Erez Lirov,
already take advantage of this economy of scale and benefit from a large
data set, efficient processes, and streamlined management. Billing networks
promise to deliver the same value for providers by using the knowledge gained
from processing claims numbering in hundreds-of-thousands every month; claims
from many individual providers across the nation.
By combining data from numerous clients, medical
billing services offer hope
to individual medical practitioners struggling to compete with large-scale