Starting a medical billing service is easy compared to the next step which is winning the client’s trust and building a loyal customer base. As a medical billing service entering the market, you need to chart out a startup plan that takes into account the startup costs, area of specialization, target audience, scope of services, and marketing. You need to measure the growth of your business and keep realistic timelines for the returns to start coming in.

Estimating startup costs

The startup costs of a medical billing service are relatively low. As medical billing does not necessitate an office establishment or display arena, you can start working from home or a small office on cheap lease. Your funds will be invested towards office equipment, software and marketing. Initial costs usually relate to:

1. computer system
2. modem for internet connection
3. business opportunities (if any)
4. printer
5. fax machine
6. software
7. clearinghouse
8. HCFA 1500 forms
9. reference books
10. phone with answering machine
11. office stationary
12. postage
13. training (if required)

Selecting a medical billing software

There are many medical billing software solutions in the market. They range from $500 to $10,000 in cost and include a number of features that may or may not suit your business functions. You can purchase a simple program that suffices for processing HCFA 1500s or a more advanced solution if you offer extra services such as lead generations, marketing assistance, and customer support. Explore business opportunities but make sure you get value for your money.

Whichever medical billing software or business opportunity you select, you should perform some preliminary checks:

1. How long has the software vendor been in business?
2. Who are its customers?
3. Get references and call them to know their experience with the vendor. Ask about good and bad points, customer support availability, and quality of services.
4. Be watchful of signs that indicate the vendor may be closing or moving business.

Hiring a clearinghouse

Clearinghouse refers to companies that receive and transmit electronic claims. Your association with a clearinghouse will be long so ensure you vet it thoroughly and conduct market comparisons. Clearinghouse costs vary widely with membership fees ranging from zero to $300, and signup costs per doctor being as much as $50.

Cost of reference books

As a newbie in medical billing, you will be referring your books often. Make sure you have a good collection of reliable reference books such as CPT and HCPCS Expert 2000, ICD-10, CDT-3 for dentists, 2010 CPT, 2010 HCPCS, 2010 ICD9 for Physicians and others.

Training costs

Even if you have some experience in the medical field, enroll in a medical billing training to educate and update yourself on billing procedures and practices. Trainings can be basic or advanced, classroom or online with costs ranging from $1500 to $20,000. Topics covered should include some or all of the below:

1. commonly used medical terminology
2. medical coding
3. ICD-9 CM, CPT, HCPCS coding
4. CMS-1500
5. billing forms
6. clearinghouse
7. revenue cycle management
8. AR work
9. Medicare, Medicaid, TRICARE
10. BCBS and other commercial payers
11. application of Six Sigma in medical coding and billing
12. workers compensation
13. NPI, CLIA
14. HIPAA rules and HITECH Law
15. EMR systems

Selecting the target audience

The healthcare industry is huge. It comprises of diverse specialties (pediatrics, osteopaths, psychologists, psychiatrics, podiatrists, etc.), practice sizes (family, clinic, nursing home, hospital, etc.), and providers that work around medical services such as ambulance services, social workers, pharmacists and the like.

For starters, you should target practices of cardiologists, chiropractors or dentists that have a low count of diagnosis codes, making it easier for you to learn and improve your medical billing skills. If you have prior experience in a medical field, begin there. Being familiar with medical jargon and procedures goes a long way in making initial billing smoother and error free. You can move on to family practitioners and surgeons once you are more confident. Depending on how much you want to grow, you either stick to a few customers or expand your client base.

Selecting the right sized medical practice

Start with small and mid-sized practices. The volume of claims is manageable and you can learn without getting saturated with work. If you want your service to grow into a flourishing business, you gradually move on to larger practices. The type of practice you work for affects the volume of work. A chiropractor charges less and sees more patients, leading to more claims and more work for you. For the same amount, a cardiologist charges higher, sees fewer patients and generates lesser claims for you to process.

Scope of the medical billing service

A medical billing service should define its scope of services. You can work on medicare claims, medical insurance claim submissions only or offer complete practice management services. Practice management involves management of all accounts receivables and payables, their tracking, electronic claim submissions and patient billing. Some medical billing companies provide all the services a client may need to clinch the deal.

Marketing your medical billing service

Networking is key to marketing your newly established medical billing service. Spread the word to all your contacts – lawyer, family physician, child’s pediatrician, dentist, your grandfather’s geriatrician. People talk and they can refer your name to potential clients. As it is not uncommon for medical billers to over-promise and under-deliver, coming with a recommendation increases your chances of winning a prospect’s trust. Next, visit nearby medical practices and advertise your services.

Medical billing services is a lucrative business opportunity. Even as a part-time option, you can make a good income with just a handful of clients. The key is to be good at what you do. This comes with practice, experience and a lot of hard work and commitment. If you can make one practitioner happy with your services, she is sure to refer your name to her peers and associates.

Tags: medical billing

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