The A-Z of Better Billing

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Gathering in all the money you are owed for your private practice work does not come easy for many independent practitioners. Garry Chapman runs through the billing alphabet your practice needs to remember

is for AC100 – the code for local anaesthesia – and understanding what procedures it can be billed with, as it can be different for each
private medical insurance (PMI) company. If not done correctly, it could result in loss of revenue on an ongoing basis.

is for bad debt, which can typically run at between 5-10% for a private practice compared with less than 0.5% achieved when using a billing company.
This difference not only results in a loss of revenue but the outstanding money can cause potential cash flow issues, particularly when the tax bill is due.

is for Clinical Coding and Schedule Development (CCSD) group codes, which should be used to ensure that your practice codes correctly and also understands what codes are allowed to be billed together. This will optimise the revenue while, at the same time, ensure that the practice is complying with both CCSD and PMI rules and regulations to avoid de recognition.

is for did not attend (DNA) and deciding what the practice should charge patients who do not turn up for the consultation. If there is going to be a potential charge, then making sure that it is clearly detailed in the terms and conditions is important.

is for embassies and making sure that, if the practice treats their patients, it does so only with a letter of guarantee (LOG), otherwise the embassy will not pay that invoice. Some embassies also require a medical report with each invoice. Due to the long payment terms, the possibility of paying tax on this before payment is collected is very real.

is for fees and understanding what each PMI will pay for each CCSD code. It is different for each PMI and this difference can be up to 100%, so if the practice is not aware of the differences, then it can be losing revenue on an ongoing basis. This information can also be used to decide what the practice charges should be for the services in the specific specialty.

i s for group practices. Over the last few years, many consultants have formed a group practice which has resulted in higher growth than they were experiencing as individuals and therefore benefiting all of the consultants within the group. One of the main benefits being that, within the group, the practice can cover all aspects of the specialty, resulting in more referrals.

is for Her Majesty’s Revenue and Customs (HMRC) and making sure that billing for the practice is auditable and organised so that it can easily generate figures for the tax returns. At the same time, should it ever investigate the practice, knowing that this information is easily available to comply with any request will be comforting.

is for incorporated. Since the last round of income tax rises, a high proportion of consultants have gone from being self employed to making their practice a limited company in order to be more tax-efficient.

is for January, which is a good time to review how the practice operated commercially in the previous year. Then any decisions that need to be taken on key commercial aspects such as fees, debts, and internal procedures can be taken and implemented before the start of the new tax year.

is for knowledge. In a successful private practice, this is absolutely crucial from a medical perspective which has typically taken years of dedication and training to attain.
But it is equally important from a commercial perspective to have a large amount of business knowledge.
It is rare to find this within a private practice, so if it is not available, then outsourcing those key areas to obtain the required level of expertise should be seriously considered.

is for limited liability partnerships (LLPs ) , which is an alternative to incorporation when forming a group of consultants that are going to work together and trade as one entity.

is for medical billing and collection; this should always be a priority in the practice. If it cannot be a priority due to the pressures of work, the practice needs to consider outsourcing this vital area. This should ensure the bad debts are kept at less than 0.5%, that the codes are billed at the correct rate, leaving the practice to focus solely on the medical side.

is for new consultants entering private practice. With the reduced reimbursement levels available to these consultants, it is absolutely vital that they ensure that the billing and collection part of their practice is operating at optimum levels to reduce any potential cash flow issues. This becomes increasingly important as the practice develops and the overheads grow.

is for overseas patients and understanding that, if the practice decides to see these patients, it needs to have a robust billing and collection system in place to ensure that they get paid before the patient leaves the country.

is for patients, who, lest we forget, are the most important people in any private practice. Without them, the practice would not exist.

is for quotes to ensure that when the practice charges outside the insurer’s fee schedule or does complex work, the patient is fully informed of all the costs so that they can liaise with their insurer to understand what they will cover, so that the patient knows exactly what the shortfall will be.

is for registration form, which should be part of any new patient process within the practice. It should contain all the patient demographics, including mobile number and email address as well as their medical insurance details.

is for self-pay. This sector has grown considerably over the past few years and is now typically the largest or second largest part of the private practice revenue stream. Setting the consultation and procedure fees at the right level for this sector is crucial to take advantage of the increase in market share.

is for terms and conditions and making sure that your practice costs are transparent and that the patient is made aware of all known costs and what their liabilities are. This could also be included in the registration form.

is for undercharging, which unfortunately, from our experience happens in most practices. Undercharging occurs for a variety of reasons and typically has been going on for many years, resulting in a considerable loss of revenue. It is usually due to a lack of knowledge or understanding of the market that the practice operates in and also how the different private medical insurers calculate their fee schedules.

is for voicemail. Any practice where phone calls go to voicemail rather than get answered by practice staff could result in a loss of patients, which could result in loss of revenue. If this happens a lot, then the practice should consider having an ‘overflow service’, where any calls coming into the practice that do that get answered are passed to an external source where they are always answered.

is for website, which is what every consultant who operates in private practice should have in order to take advantage of the self pay sector. This sector is currently experiencing excellent growth with an ever-increasing number of people who are becoming disillusioned with the NHS. A lot of these people are then using the internet to source a consultant for treatment.

is for Xmas, when all consultants should use the time to take a well-earned break from private practice. It is the only time of the year when even the patients do not want to be seen unless it’s absolutely necessary. It’s a time to recharge the batteries and look forward to the New Year.

is for your money. While consultants enter medicine to treat and heal people – and this motive remains true when they enter into private practice – they must also accept that it is now also a business with the associated extra work and overheads, so the commercial aspects must be taken seriously. The billing and collection side of this is probably the single most important aspect of the commercial side of the practice. But, sadly, it is quite often ignored, which can result in considerable loss of revenue.

is for Zzzzzzzzz – the sound that the consultant can make sleeping soundly at night, knowing that the practice billing and collection is under control, it is not losing revenue, it does not have bad debts and it has a robust system in place for the tax aspects of the practice.

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

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