In-House Billing May Be Hurting Your Healthcare Business

Without effective billing practices your hospital or medical clinic can’t remain financially secure, and that can ultimately affect how well you’re able to serve your patients. Some facilities manage to increase cash collections by analyzing and tightening the revenue cycle and offering updated training to in-house coding and billing staff. But it requires constant vigilance.


Some practices don’t realize the level of problems they had until they outsource revenue cycle functions.

Another option is outsourcing some or all revenue cycle functions. For example, your hospital or practice may choose outsourcing your AR to get this important function back under control. The first step to determining if something like this would be right for you is to evaluate what you may be missing by taking care of your various revenue cycle functions in-house.

You Could Be Stuck with an EHR That Doesn’t Serve You Well

Healthcare practices and hospitals must always be aware of containing costs, and one way many have tried to do this is with a free or low-cost electronic health records (EHR) system. While this can work for some facilities, being locked into a system that doesn’t offer the tools and features needed can ultimately become detrimental to effective billing practices. It’s important to read and understand terms and conditions whenever you incorporate a new software product of any kind into your operations and consider total cost of ownership.

You Might Second-Guess Coding and Billing Decisions

Last year, the switch from ICD-9 to ICD-10 meant a lot of retraining and relearning. Even if you have experienced, conscientious coding and billing personnel, there will be occasions when they experience uncertainty, and the result can be rejected or denied claims and slower payments. Since efficient billing practices are a cornerstone of a financially secure hospital or medical practice, second-guessing coding and billing decisions can be costly in terms of both time and money.

Your Cash Flow May Be Slower than Necessary

Having an efficient revenue cycle depends on many factors, like how long accounts spend in AR, your rejected claims rate, and how adept your team is at collecting patient payments for their part of the bill. Handling coding, billing, AR, and collections in-house requires meticulous attention to detail, often on a short deadline. It’s not easy to be meticulous enough if your team’s talents are spread too thin.


A strategy to address slow cash flow is essential for the health of your medical facility.

Attention May Be Diverted by Other Goings On

Hospitals and medical practices are among the most dynamic environments there are. There may be periods when days are predictable and your team can focus on the tasks they expect to focus upon, but there will be plenty of times when the unexpected happens. Naturally, you must prioritize patient care, and there will be times when this can cause efficient billing practices to be put on the back burner. Keeping your revenue cycle functions in-house means accepting that sometimes even important tasks will have to be postponed.

You May Spend Considerable Resources Keeping Staff Trained

Few industries are bound by as many regulations as the healthcare industry. Moreover, regulations change frequently, and on top of that, insurers all have their own ways of doing things. A trained staff is absolutely necessary for the functions you provide in-house, but training can be expensive and periodically take staff away from their normal tasks. You can’t simply cross your fingers and hope everything will be OK, because running afoul of regulations and insurer requirements can be quite expensive.

Your medical facility exists to help people recover and maintain their health, and that’s what you want to focus your primary efforts on. Maintaining good billing practices, however, also requires dedication, so it’s no mystery why, for example, outsourcing your AR may cross your mind. There are many ways to increase cash collections, but all require attention and commitment. You could be missing out on that commitment level if you keep all your revenue cycle functions in-house. Selective outsourcing, or outsourcing multiple functions can be the wisest investment of your resources, allowing you to concentrate on your patients, confident that your revenue cycle is taken care of.

HFS (Healthcare Financial Systems) has worked with hundreds of healthcare providers over the past 18 years to optimize revenue cycle management and improve collections. With our involved, hands-on approach that incorporates both service and technology, plus the flexibility our clients demand in their RCM solution, HFS invites you to schedule a confidential consultation. Learn how our RCM programs benefit organizations like yours. If you prefer to talk by phone, please call us at 888-419-4569.

Author: Emma Chung

Twenty-five years experience in Revenue Cycle. Twelve years directing Patient Access and Patient Financial Service functions in various sized healthcare systems and physician practice networks. Additionally as a consultant I managed numerous successful projects overseeing assorted aspects of revenue cycle assessments and process improvement implementations. Served as featured speaker on various revenue cycle topics for AAHAM.