Topic: In Real One (
Make a comment)
Here are the latest comments from our readers.
Read them and submit your own comments
by Barkri Meti on 4/13
The single biggest mistake doctors make is forgetting to calculate what it will cost them to manage the staff they hire to do billing in house.
It is one of the golden rules of business.
Pay yourself first.
There are other hidden costs when it comes to managing a billing team as well. The numbers below are based on numbers that were given to the doctor from a very well know chiropractic coach, not numbers I came up with.
· Projected number of weekly patient visits: 500 patient visits/week
· Projected Total Collections(TC): $60, 000/month x 12 = $720, 000/year
· Total Insurance Collections (TIC): 60% insurance = $432, 000
Total Staff Cost (SC)
· Staff hours per year (SHY):
o 3 part time staff = 3 x 20 hours/week = 60 hours per week x 52 weeks = 3120 hours/year
· Average hourly rate (SHR):
o $15/hour
· (SC) = (SHR) $15/hr X (SHY) 3120 hours = $46, 000
Management Cost (MC)
· Doctors hourly compensation (DHC)
o Hours worked = 30hrs/wee X 52 weeks = 1, 560 hours/year
o Total Collection = $720, 000/year
o DHC = (Total Collection) $720, 000 / (Hours Worked) 1, 560 = $461/hour
· Hours spent managing billing staff personally (HS): 2 hours/week x 52 weeks = 104 hours/year
· MC = (HS) 104 hours/year X (DHC) $461/hour = $48, 000
Total Cost for in house billing (TCIB)
· TCIB = Staff Cost (SC)+ Management Cost (MC)
· TCIB = (SC) $46, 000 + (MC) $48, 000 =$94, 000
TCIB as a percentage of collections (TCIB%)
· TCIB / Total Insurance Collections = TCIB%
· $94, 800 / $432, 000 = 21.94%
Total Cost of Outsourced Billing (at 8%) (TCOB)
· TCOB = Total Insurance Collections X Billing Company Fee
· $432, 000 X .08 = $34, 560
FAQ
Q: What if I found one super biller that could work 20 hours per week they can get it done?
A: You would still need to manage that person 2 hours per week and it is not worth the time.
Your staff salaries would drop to $15, 600, but you would still be paying yourself $48, 000, giving you a total of $63, 600 or 14.72% of insurance collections.
You would not be under 8% until you spent less than 45 minutes per meek managing one part time person to do billing for a 500 per week office.
Reply | Permalink
< Previous Topic Next Topic >
View: Simple |
Summary | Expanded
As: Threaded | Msg List
