4.5% of net collections to perform the billing function within a physician's office. Incidentally, this is close to my actual cost as well. Theoretically, a billing service should be able collect more money than a physician's office because it is our core competency. The question is how much more? This is why I focus on how to choose a billing service at the end of this article. The numbers A. Lets just do the math in a theoretical model. We'll base our numbers on a practice whose total gross receivables are $100,000 per month. Obviously, this is an overly simplistic model designed to quantify the aggregate cost and or opportunity cost of the medical billing component only. Current Aggregate Billing Expenses In-house expense Total gross revenue $100,000 Current billing expense $4,500 (4.5%) --------------- Net Revenue $95,500 Outsourced Billing Expense Total gross revenue $100.000 Current billing service exp. $7,000 (7.0% net collections) --------------- Net Revenue $93,000 Net cost increase with outsourcing = $2,500.00 As you can see in this,ö all things being equalö theoretical model your practice would incur a $2,500 decrease in net revenue with the implementation of a billing outsource strategy. Keep in mind that this model does not address other less tangible issues such as your reduced payroll, computer expenses, ect. In reality the net cost could be substantially less than $2,500. Many physicians will perceive this as a small price to pay while others will consider it to be cost prohibitive. 5% theoretical increase in gross revenue with outsourced billing Total gross revenue $105,000 (5% increase) Billing service expense $7,350 (7% net collections) ---------------- Net revenue $97,650 $95,500 - $97,650 = $2,150.00 increase in net revenue. As you can see from this model with a 5% increase in collections your net revenue will increase $2,150.00 with the added expense of the billing service. Keep in mind that a 5% increase in gross collections is actually quite conservative and should easily be obtainable by quality billing service. Intangibles B. A billing service should be able to provide you with a substantial reduction in your day-to-day aggravations such as practice
piece
is
an
abstract
triptych
that
I
found
while
I
was
in
Atlanta
buying
religious
paintings
The
piece
was
called
Guardian
Angel
and
I
love
it
My
patrons
fell
in
love
with
it
as
well
They
have
asked
me
to
track
down
the
artist
and
see
if
he
has
anymore
religious
paintings
available
The
only
religious
paintings
that
I
actually
do
not
buy
are
ones
that
reflect
the
image
of
Jesus
on
the
cross
I
don’t
have
a
problem
with
them
some
of
them
are
extremely
well
done
and
would
more
than
likely
sell
well
but
my
investors
made
it
very
clear
when
they
financed
the
gallery
that
I
would
not
put
that
image
into
it
PPPPP
683
Ajello
Candles
The
motto
of
the
Ajello
Candle
Company
is
“It’s
better
to
light
a
candle
than
to
curse
the
darkness”
This
candle
making
company
has
been
in
business
since
1775
The
business
has
been
family
owned
for
seven
generations
The
candles
from
Ajello’s
are
well
known
for
their
beauty
and
quality
While
they
make
more
candles
now
than
in
1775
their
dedication
to
quality
and
to
customers
has
never
changed
The
Ajello
Candle
Company
was
founded
by
Rafael
Ajello
an
Italian
painter
He
was
also
a
beekeeper
so
he
tried
his
hand
at
using
bees
wax
to
create
candles
He
worked
hard
to
create
a
formula
that
worked
well
The
formula
combined
with
his
outstanding
artistic
ability
lead
to
the
birth
of
the
Ajello
Candle
Company
In
1785
the
company
earned
the
honor
of
creating
all
the
candles
for
the
Vatican
He
and
his
wife
ran
the
business
keeping
their
children
involved
in
the
processes
from
an
early
age
As
time
went
on
their
children
and
grandchildren
kept
the
business
running
as
well
as
passed
the
family
business
on
to
their
children
By
1862
the
company
had
established
itself
as
a
leader
among
the
candle
making
industry
They
had
also
added
perfumes
and
many
.
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