Medical Billing Business Plan

Medical Billing Business Plan

Billing services currently exist to manage medical practices. These services help medical professionals with tedious details but seldom offer a way to significantly improve the practice’s bottom lines. Physicians 1st Billing and Claims not only will free up office staff to do more important tasks but also will maximize the return on insurance companies.

National statistics show that only 70 percent of insurance claims submitted on paper are paid by the insurance companies. The percentage of claims paid can be increased to around 98 per cent by electronic submission through Physicians 1st Billing and Claims.

Additional statistics indicate that it currently costs a medical practice between $8.00-$10.00 per claim to process insurance for their patients. These costs can be reduced by 50% or more with Physicians 1st Billing and Claims.

Statistics show turnaround on paper insurance claims to be 30, 60, even 90 days or longer, creating serious outstanding receivables for the practice. Physicians 1st Billing and Claims usually has money in the hands of physicians within 14-18 business days after they submit claims electronically. This greatly reduces outstanding receivables. It also significantly increases cash flow.

Statistics also show a 30 percent suspension/rejection rate for paper insurance claims. This does not mean that the claims will never be paid. What it does mean is medical staff must hassle with insurance carriers over payment. This percentage can be reduced to between 2 and 3 percent by the thorough editing of electronic claims before they are sent to carriers. Claims are submitted accurately at 98 percent.

Many years ago, physicians were taught that they would be running a practice. Numerous administrative procedures were ignored, such as:

  • To ensure claims are paid promptly, it is important to keep up with current insurance specifications and regulations.
  • Concentrating on collecting receivables and co-payments,
  • It was important to ensure that fees were paid at the highest level allowed by insurance carriers.
  • Procedure codes were current so that claims weren’t suspended or rejected.

Outstanding receivables increased dramatically in many offices and it became a routine to write off bad-debts annually. But adequate profit margins allowed medical practices to ignore sound business procedures. It is now overdue for medical practices to be complacent about industry change. Physicians raised their heads and began to listen to the public’s opinions about reforms in health care four years ago. Physicians are experiencing shrinking profit margins due to the influx of managed care organizations into their industry. They recognize that to be able to continue to operate in the 21st century, physicians will need to have more efficient business practices. Physicians 1st Billing and Claims is ready to support local health providers in moving through the 20th and 21st centuries with sound business practices. This will help ensure that quality health care is provided for our families and the country.

Physicians 1st Billing and Claims provides over $9,000 for this business. We would like to borrow another $5,000. Please give this detailed business plan your attention. This section will explain how to use the funds.

1.1 Objectives

  1. You can open one account before the end of month 2.
  2. 1500 claims processed per month 15.
  3. To be recognized as an expert in local medical reimbursement.
  4. You may also add the following services to our initial offer of electronic claims submission:

    • Optimization of code
    • Managed care contract analysis.
    • Full practice management.
    • Customized reporting.
    • Medical transcription.
    • Fee analysis
    • Medicare financial impact analysis.

1.2 Mission

Physicians 1st Billing and Claims (Patients 1st Billing and Claims) is a medical reimbursement consulting business that helps medical practices become more efficient and cost-effective by allowing them the ability to outsource their insurance processing and medical billing. We aim to be the one-stop shop for all administrative tasks in medical practice by 1998. We expect to earn enough profit to repay the business-startup loan and continue our growth with our quality service.

1.3 Keys to Success

Since 1985, the Federal Government has been urging the health care industry to submit insurance claims electronically. Statistics show that electronic submissions can save the industry millions of dollars each year. Electronic submissions account for 95% of all hospital claims and 70% of pharmaceutical claims. The percentage of electronic submissions for physician and dentist claims is far lower than that for physicians and dentists, which are only 25-30%.

This is something that the Federal Government doesn’t like so Congress in 1990 required physicians to file claims on behalf every Medicare patient. This deluge was overwhelming for many doctors. Eight years later doctors are still climbing out from under the paperwork. 1996 saw the echoes of Congress calling for electronic submissions of all Medicare claims. Although no mandate was given, the paperwork is growing and the baby boomers are approaching retirement age, the paper problem will only worsen. Those echoes will soon become screams. The United States will issue more than 1 trillion dollars in medical bills this year. This amounts to 9 billion medical claims. The mandates will be enforced on medical practices, which are already buried under mountains of paperwork and not equipped to deal with the change. The smart thing to do is outsource the process. This will save the practice money, help them get more from their insurance carriers, and ensure that they handle all claims accurately. There aren&#8217 a lot of businesses that can say that they have the Federal Government backing them all the time.

Flexibility is another key to our success. Physicians 1st Billing and Claims recognizes that every medical practice is different. Even the same specialty practice will have different staff members and offer different services. Physicians 1st Billing and Claims can evaluate each practice and suggest solutions to make it more efficient. While some might want all of our services, others may only need a select few. Each office will have its own billing.

Our diversified services are a third key. Physicians 1st Billing and Claims can be described as a one stop shop for medical administrative services.

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