
What is the actual cost of an in-house billing department? There are many costs that must be lumped together to determine what the true cost of operating an in-house billing department is, including: Employee’s salary Employee benefits Worker’s compensation Social security Healthcare insurance Vacation, sick leave, etc And many more Computer hardware purchase / maintenance Software purchase / maintenance Clearinghouse fees Postage Stationary Office Space Training and re-training for new staff Recruitment costs What is the opportunity cost? The opportunity cost is in this case defined as where income could have been generated if the billing was not done in-house, and those costs include: Space used for billing department could be transferred into a revenue-generating examination or treatment room Doctor’s loss of time that could have been spent seeing patient, and is instead spent on billing department And then... What happens when you grow or when the work begins to pile up because of continuous backlogs? It is time to hire another biller. Take a look at the chart below; this chart details what happens when a practice hires another biller.

When hiring one biller, cost increase tremendously. Workload has not yet seen a big increase, but it will happen over time. Until workload is increased, the biller will be left idle for most of the time and that idle time can be costly. If you take a look at the outsourcing cost line, you will see that with an outsourcing module, cost is smooth as a percentage of revenues. While workload may increase or decrease, cost always stays in line with revenues. What most, if not all, of our clients appreciate about the outsourcing model, is predictability.