Advantages of Outsourcing
The focus on outsourcing over the last several years has had quite an impact on the way companies do business. When it comes to advantages of outsourcing, they are countless and truly differ from company to company. No longer do we spend countless hours and dollars building infrastructure that is common to many organizations. It is commonly known that it makes better business sense to build an infrastructure by leveraging companies that have the expertise in the business processes that are needed. Ask an executive if it shows good judgment to outsource business processes, and the answer is a resounding yes. Etech exemplifies the advantages of outsourcing one of the most critical aspects of any medical practice.... the billing function. Some of those most commonly cited include:
• Focus can remain on core business activities
• First-class solutions and expertise are accessed
• Competitiveness is enhanced
• Cost structure becomes variable
• Inside resources are freed for other purposes
• Capital funds are made available
• Expertise is accessed
• Operating expenses are reduced and controlled
• Activity is better managed
• Operations can be planned and scaled with greater flexibility
• New ideas are acquired
• Investment in assets is lowered
• Risk is reduced
It turns out that these advantages; as well as many others, indeed result from a good outsourcing strategy. However, there are three KEY benefits and Advantages of Outsourcing that truly make outsourcing a logical solution for many small businesses, listed as follows:
• Outsourcing is cost effective,
• Outsourcing business processes allows a greater focus on core business, and
• Outsourcing provides access to first-class solutions
Some other specific benefits may include:
Human Resource Management
In considering outsourcing, it’s important to think with a long-term vision in mind. The two biggest reasons why Physicians eventually decide to outsource the billing function is difficulty in managing the human resource cycle and level of expertise. Human resource management problems arise from employee turnover and practice growth and it is always critical to the success of any medical practice to accurately and timely get paid for all services performed.
Employee Turnover
Many medical practices go through high turnover periods, while others find loyal people who dedicate many years to working for the same Physician. The human resource management cycle can be very difficult for a Physician to maintain, since once the biller leaves, the Physician is left with no other option and is usually forced to hire someone who has very little experience and requires many months of training. Ask yourself this question; when would you be the most worried; when your receptionist quits or when your biller leaves? Do you really have the time to find someone who is experienced and reliable and can do the right job with the amount of attention your billing deserves? Are you prepared to go through several months of cash flow shortfalls?
Organic Growth
Growth is a normal part of any business. As a practice grows, revenues grow and ultimately, the workload grows. Coupled with the complexities of managed care, it becomes important to hire new people to meet the new workload demands. If a Physician has kept his/her billing in-house and, when it comes time to hire another biller, the Physician is increasing his/her fixed cost substantially, and all at one time. Not only is finding the right person for the job difficult, but hiring an extra person can be a heavy cost-burden.
With a billing service, the human resource management problems are eliminated on the part of the Physician. Etech is not immune to turnover, but we are able to absorb that attrition because we have a pool of employees within our organization. When we work with a client, we work as a group; i.e. we do not give one employee all of one client’s billing. In this way, we can easily manage the normal attrition that occurs in companies and medical practices today. Additionally, as you grow your practice, your cost/revenue percent remains the same without any large increases.
Cost Effective Solution
When you outsource, you save money and resources in many areas because they are eliminated from your worries (and your checkbook), such as:
• Computer hardware
• Maintenance fees/support contracts
• Software and upgrade costs
• Delay in claim research
• Delay in claim resubmission
• Time spent on phone with insurance companies
• Training seminars/education
• Human resource recruiting
• Holiday, vacation and sick pay
• Wages, taxes and benefits
• Office space dedicated to the billing function
Ability to Demand Accountability from a Billing Service
When you outsource to a billing service, the billing service is typically collecting a percent of whatever is collected; therefore, the incentive and the headache to collect falls on the billing service. This production aspect of outsourcing works to your advantage.
The misconception is that by outsourcing to a billing service, the Physician loses control of his/her billing. To the contrary, we maintain that outsourcing actually gives you better and full control of your billing, since the ease at which you can switch between billing companies is much simpler than switching between employees. Etech will provide you with all the necessary reports and feedback so that you’ll know exactly what was billed, who is paying and most importantly, who is not.