In house or outsourced medical billing – which is a better choice for physical therapy management?


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This article explores whether in-house billing or outsourcing is better to address the challenges involved in physical therapy billing and coding.

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In house or outsourced medical billing – which is a better choice for physical therapy management?

  1. 1. 1-800-670-2809 In-house or Outsourced Medical Billing – Which Is a Better Choice for Physical Therapy Management? Physical therapists in the United States face several crucial developments in 2014 such as Medicare payment trends, ICD-10 implementation, second stage of the meaningful use incentive program for electronic health records (EHRs) and so on. Since most of these challenging developments can have a significant impact on their reimbursement, they are required to fine tune their medical billing practices as early as possible. Physical therapists have two options – in-house billing with Electronic Medical Records (EMR) or outsourcing billing tasks to a billing company. In the opinion of experts, the following things should be considered when deciding on a suitable alternative for your office. Practice Approach and Expertise If you choose in-house billing, it is very important to ensure that your staff has expertise in analyzing financial reports and are
  2. 2. 1-800-670-2809 able to assess and address issues within your practice effectively. For example, Medicare therapy cap amount is assigned per beneficiary for physical therapy services each year in case of outpatient therapy (annual per beneficiary therapy cap amount in 2014 is $1920 for physical therapy and speech language pathology services combined). If a patient’s treatment exceeds that amount, physical therapists may request an automatic exception using KX modifier for those claims in Medicare allowable (if medical necessity is properly supported). Only experienced practice staff would be aware of these things and perform billing tasks accordingly. Engaging a third party service to manage the entire medical billing process is the practical choice if your practice staffs are not that very efficient. If you don’t prefer to have an administrative team to handle daily billing functions within your office, medical billing outsourcing is the best option. Cost and Budget In-house expenses would include labor cost, up- front costs for hardware and physical therapy billing software, and training and maintenance cost for billing system. Fees for billing services from outsourced companies are typically based on the percentage of collection. However, this may vary
  3. 3. 1-800-670-2809 according to the specialty and the range of services offered. The startup cost for physical therapy business may depend on how your state permits you to operate as a physical therapist. Physical therapists should monitor thoroughly whether in- house billing or outsourcing is more suitable to their budget. Never compromise cost for quality as it may cause financial loss in the end through claim denials and appeal processes. Performance of Office Staff The financial status of a physical therapy clinic will remain safe only if the billing staff performs their tasks efficiently. High-performing staffs would be well-versed in billing procedures, well-aware of the proper protocol of each payer and remain up-to- date on the latest government policies. For example, when ICD-10 transition comes, therapists are required to use the most appropriate codes for specific health conditions. You may need to use even multiple codes for a single condition. Let’s say a patient strained his Achilles tendon in the right leg as a result of slipping when playing with his friends in his garden. Four codes are needed to specify this condition using ICD-10, code for the strain of right Achilles tendon (should specify the encounter), activity code, place of occurrence and external cause.
  4. 4. 1-800-670-2809  S86.011: strain of right Achilles tendon S86.011A: initial encounter S86.011D: subsequent encounter S86.011S: sequela  Y93.6: activities involving other sports and athletics played as a team or group  Y92.017: garden or yard in single-family (private) house as the place of occurrence of the external cause  W01: fall on same level from slipping, tripping and stumbling The practice staff should be well-trained in ICD-10 to ensure accurate medical coding and correct reimbursement for services provided. If the therapist has difficulty in finding competent billing staffs, it is better to seek medical billing services. Reputable billing companies will have high- performing staffs and provide proper training according to current trends. Therapists can save the cost for additional training in this way. Electronic medical records can increase the efficiency of physical therapy services by providing patient health details quickly. However, maintaining accurate data within EHR is quite challenging. The cost of EHR implementation and its meaningful use is a matter of concern too. The service of a
  5. 5. 1-800-670-2809 professional medical billing and coding company that offers EHR feeds is quite relevant in this regard.