Medico-Legal Billing & Collection Analysis

Gary NialsUncategorized

Media

Medico-Legal Billing & Collection Analysis

In the current economic climate many consultants are looking at alternative ways of increasing the size of their private practice, as the PMI sector has shrunk over the past 4 years it is difficult to increase the share of a shrinking market so many consultants have been looking outside of that sector. Our analysis on the invoices we raised in 2012 shows that the PMI market only accounted for 66% of the total with the remaining 34% split between other organisations such as Embassies, Hospitals, Solicitors (for Medico Legal work) and other commercial organisations. Today I will focus on the Medico-legal work and what you need to know from a billing perspective if you are thinking of expanding into this sector.The Medico-Legal sector is extremely fragmented with thousands of Solicitor’s working in this sector either independently, through a group as well as via the medico legal agencies that exist. Due to this plethora of potential clients it is absolutely crucial that you get your practice prepared correctly from the very first contact with these commercial organisations.In our experience many consultants start doing Medico-legal work without due consideration to the fees that they should charge or in particular to their terms and conditions. What then tends to happen is that they then find out way after the work has been done that the case they have been working on is a “no win no fee basis” which means that they often end up waiting years for their money. The obvious problem with this is the effect it can have on the cash flow of the practice; the biggest problem which is often overlooked is that once the invoice is raised it means you end up paying tax on it. This means that until you collect the money you are actually paying to do the medico-legal work!! If you have a large medico legal practice and charge VAT the situation is so much worse as you would have had to pay the VAT (currently 20%) to the HMRC every Quarter which increases your overall debt and exasperates your cash flow predicament!!!!!

The worst case we have seen over the years is one practice which had started medico legal work many years ago and every month they were invoicing more than they were collecting. This had continued for so long that it led to an outstanding debt figure which had reached over £400k going back nearly 10 years before we started working on it.

There are many factors to consider before starting working on Medico-legal cases and I have focused on the billing and collection aspects with the major issues highlighted below.

These should form part of your terms and conditions:

FEES

• How much do you want to charge for your Standard Medico-Legal report, this should be based upon the length of time taken to review a standard amount of medical records, include any interview or examination of the client including all dictation and preparation of documents. You should also quote an additional cost per hour to provide some flexibility for cases that take longer to review, particularly where there are a large amount of medical records to review or where the case is very complex.

• Court Cases, where you are requested to attend court you should have a fee schedule per day, due to the nature of these your fee should be for a minimum charge and not related to the amount of time you have to appear. You should also charge for travelling expenses as well as any other expenses that you incur attending the court.

• Supplementary work should also be quoted at an hourly rate; this is to cover any further reviews and additional work relating to the case. These can then be invoiced at the hourly rate, typically in 15 minute increments.

• DNA’s, for those cases where the patient does not attend without prior cancellation within a given time frame or where your court appearance is cancelled within a given time frame you need to decide what your charges will be.

PAYMENT

• You will need to decide what your standard payment terms are going to be for your medico-legal reports, these will need to be balanced according to the sector that you are operating in and ones that you are prepared to enforce.

• You should have different payment terms for any court appearance and these should also take into account any charges you make when the court appearance is cancelled within your penalty period.

Once the above is resolved and you have formulated your terms and conditions the next key step is to ensure that you have a robust system in place in order to chase up outstanding invoices. This should entail making sure that in the first instance your fees and terms and conditions are accepted up front before taking on any case. Once you have raised the invoice it needs to be followed up with a telephone call to ensure that it has been accepted and has been put on the solicitors/agency system with the correct payment terms.

Even when all the above is done you will still need a system in place to chase payment on a continual basis to ensure payment is made in a timely manner. Should you have issues collecting payment with a particular solicitor/agency then you need to think long and hard about taking on other cases from the same company or you could end up paying to do work for them.

Chasing the money on a continual basis is the hardest part of this whole administrative process as most practices are not geared up for this specific aspect. It is both time consuming and requires a specific skill set, it is rare to find a practice which has the time to chase these invoices on a continual basis, even rarer that they have the skills in house. The Alternative is to use a professional billing agency; either way before you start doing medico-legal work or if you have been doing it for some time then you need to gain control of this crucial aspect or run the risk of paying the HMRC for the privilege to do the work.


  • 01494 763 999
    info@medbc.co.uk
  •   Medical Billing & Collection
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         Repton Place
         Amersham
         Buckinghamshire HP7 9LP


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