8 Points on Whether In-House Billing or Outsourcing Services Makes More Sense for ASCs

Industry experts discuss different situations when either outsourcing billing services or creating an in-house billing department makes more sense for surgery centers.

Outsource billing services

1. High volume centers. In some situations, it makes sense for high volume surgery centers to outsource billing services because you don't want to fall behind on collections. "If you are a high volume surgery center and you constantly have dirty claims and you aren't making headway on your accounts receivable, it's usually a direct effect of your staff," says Kelly Grier, vice president of business operations for ASD Management.

Michael Pankey, RN, administrator of Ambulatory Surgery Center of Spartanburg (S.C.), runs an outpatient surgery center where physicians have about 10,000 patient visits per year. "The larger a center gets, the more beneficial outsourcing becomes because the more people your vendor can put on your account," he says.

2. If you can't find knowledgeable billing staff.
It's often difficult, especially in small markets, for surgery centers to find experienced billing and collections staff. Coders and billing staff must be familiar with the ASC arena as well as the payors in your region. "It is very hard to find staff members that understand the ASC billing guidelines and are knowledgeable about payors in the area as well as facility collecting," says Ms. Grier. "If you can't get the right people who are experienced enough, you should outsource it."

Outsourcing the billing services could alleviate the administrative burden for centers where experienced coders aren't available. "The coding and billing process is not something that should be taken lightly," says Stephanie Donovan, Faculty Chair, Health Programs at Peirce College in Philadelphia. "It supports the revenue cycle and directly relates to the financial health of a surgery center or physician practice. Outsourcing an administrative function — especially if those tasked with this particular function don't have a background or education in coding — is beneficial."

3. When the facility doesn't have a big business office.
Many surgery centers were built with a focus on the clinical operations, leaving little space for business office functions. If the surgery center doesn't have room in the floor plan for a billing department, it might make more sense to outsource that responsibility. "There are some surgery centers that weren't built to accommodate in-house billing services, so they have to direct those services out," says Ms. Grier.

Mr. Pankey's surgery center wasn't built for an in-house billing department, and it became clear the surgery center couldn't support those services. "If you are strapped for space in your surgery center, especially in your business office, it makes sense to outsource the billing," says Mr. Pankey.

4. During a billing systems update.
If you are changing health information systems or going through personnel changes in the billing department, consider outsourcing collections for a short time until all the changes have taken place.

"If someone is on leave, I would outsource the billing instead of over working the remaining staff because quality would suffer," says Ms. Grier. "ASCs are staffed very lean and mean, so you carry five or six hats already in the billing office. If a biller or collector is gong to be out, the other players in the office already have other responsibilities so it's a quick fix to outsource the position so the other staff can keep up with their jobs."

5. When you have lots of staff turnover.
If you have trouble maintaining staff in your billing department, consider outsourcing that function. A great deal of time and resources is spent on each new hire, and if you aren't able to keep coders for long, it may not be a worthwhile service to have in-house. "There is a cost associated with hiring, rehiring and training billing staff," says Kevin McDonald, vice president of SourceMedical. "In many places, there is a large turnover of billing staff these days and the cost can be substantial."

In-house billing

6. Low volume centers.
Outsourcing billing and collections services is expensive and for some low volume surgery centers, it doesn't make sense to send out claims. Instead, an in-house billing department will suffice, if the right people are in charge. "The surgery centers who are low volume or single specialty aren't good candidates for outsourcing their billing department because it can be pricy," says Ms. Grier.

One or two room surgery centers may also find it less expensive to maintain an in-house billing department.

7. When there is an experienced pool of coders available.
When you have people available in your area who are experienced with billing and coding in the ASC arena, and you are the only surgery center in the market, creating an in-house department could be beneficial.

"In smaller practices, the coding function may be delegated to someone with a lengthy employment history who lacks formal coding education including continuing education.  This staffing model does not reflect best practice," says Ms. Donovan. "The coder must assign the code that accurately reflects the services rendered and maximizes reimbursement in a legitimate and lawful way. If the coder doesn't fully understand coding conventions and guidelines, they may apply codes that don't fully capture the services rendered.  This could mean underpayment for the practice"

When coders with this knowledge are available, they can be incorporated into an in-house billing department.

8. If there is a commitment to continuing education.
One of the most important aspects to housing a billing department is the commitment to coder education. "Someone in the practice should be identified as a coding and billing champion with the full support of the physicians," says Ms. Donovan. "It could be one credentialed individual who understands the value of education in the coding and billing process. This person should be encouraged to continue education onsite. If the practice manager or physicians aren't committed to staff education, then outsourcing is a more attractive option."

More Articles on Surgery Centers:

32 Statistics on Surgery Center Operating Expenses

8 Steps to Maximize Price When Selling an ASC

10 Steps to Increase the Value of a Hospital or Surgery Center

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