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Questions to Ask When Considering a Medical Billing Company or RCM Service for Your Private Practice

Outsourcing your medical billing or revenue cycle management (RCM) processes can help streamline your private practice’s operations, reduce overhead and administrative burden, and help improve cash flow. When considering outsourcing your medical billing services, it’s crucial to ask the right questions when assessing potential vendors. You want a billing partner that aligns with your practice’s needs, goals, and budget. Below, we cover questions to ask a billing company when evaluating and before hiring a new medical billing or RCM service.


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Questions to ask before hiring a medical billing or RCM service


What to look for and questions to ask when evaluating a medical billing company before hiring them


When evaluating a medical billing service or RCM company for your medical practice, areas to address include:


  • Their relevant industry expertise

  • Their technology and integration

  • Performance metrics

  • Reporting and transparency

  • The pricing structure

  • Their reputation


In our article on what percentage of collections you typically pay your billing company, we covered common red flags to assess.


10 red flags to look out for and avoid when hiring a new medical billing or RCM service

The questions below can help you identify these red flags, as well and collect other information that can help you make an informed decision. Depending on the specific services you’re looking to outsource, not all these questions may be relevant to every practice, but we’ve tried to be as comprehensive as possible.


Some of this information may be publicly available through their website or marketing materials, while others may need to be asked or ascertained while talking with representatives as you assess if a company is a good fit for your practice.



Where to start when looking to hire a medical billing service or RCM company


When looking to hire a medical billing service, word of mouth referrals can be one of the best ways to preliminary vet opportunities. We often get questions in our online physician community asking for recommendations. If a friend or colleague has had a bad experience with a billing company, they’ll likely let you know, which can help narrow down your choices.


If you are exploring potential billing companies, our partners at Cosentus may be able to help. Cosentus​ has been highly reviewed by several members of our communities. They can help with credentialing, billing and coding, revenue cycle management, and accounts receivable services. As part of a perk for PSG members, they offer a free professional billing and coding review as well as 5% off services through our affiliate link with the code PSG5OFF. 



Questions to ask medical billing services about relevant industry expertise and fit


  • What is the typical avatar of the private practices or healthcare organizations you serve? Along with type, ask what size of organization/practice they typically work with. Companies who typically work with solo practices might not be able to scale effectively for larger organizations, while those who focus on large organizations may not be able to provide a small practice with the level of attention they desire and expect.


  • What specialties do you have experience with? Many specialties have unique coding nuances, making it important to look for a billing company that has relevant experience within the healthcare industry.


  • What kind of training has your staff had? Do they have any specific certifications or training guidelines? What type of ongoing training do they receive? Does either the billing company or the employees maintain any professional affiliations?


  • Can you provide case studies or performance metrics from practices similar to mine that you’ve worked with? This can help support what they’ve told you with evidence and can suggest what types of results they might be able to deliver (though it can’t guarantee any specific outcome).


  • Can you provide references from similar practices? Don’t hesitate to also ask for a few referrals of current clients that are similar to your practice, as this can help you gauge their reputation and verify their credibility. Along with asking for and checking references, check their online reputation as well. While people are more often likely to leave negative reviews than positive ones, look for patterns in positive reviews to see what they do well and how well they deliver. Similarly, are there any patterns to the negative review that raise a red flag?



Questions to ask medical billing services to assess services & capabilities


  • What services do you offer? Some companies offer full revenue cycle management while others focus specifically on medical billing & coding, or offer billing services with a few select additional options. Along with assessing which services they offer, verify how pricing works across services. Does the price they quote you include a comprehensive package, or is there a standard baseline package and additional services, such as credentialing, are available with additional fees.



  • How is coding handled? Do they provide certified coders? This is especially important if your in-house team isn’t doing coding, or if you’re looking to outsource this to reduce overhead.


  • Do you assist with patient statements and billing inquiries? This can help you determine if your front desk staff will still have to field and manage these calls, or if this will be outsourced as part of your service agreement.



Performance and metrics questions to ask RCM companies during vetting


  • What is your average collection rate for clients? In particular, you should ask about the net collection rate, which compares what you actually collect versus what you thought you should collect (after adjustments). A good billing company should be at 95%+.


  • What is your average first pass resolution rate (FPRR)? This refers to the percentage of claims paid without having to resubmit them. You want this number to be 90% or higher.


  • What is your average clean claims rate for clients? This measures the percentage of claims that are submitted without errors on the first attempt. A good billing company will be above 95%.


  • How do you handle denied claims? Claims denials are one of the biggest sources of lost revenue for practices, so you want to make sure they have a proactive denial management process that minimizes revenue leakage.


  • What are your average days in A/R (accounts receivable)? Accounts receivable is the amount of money you’ve billed out to payers that hasn’t been received yet. This can help you understand how quickly money will come in and how much on average is outstanding at certain benchmarks (90 days out is a common one to track). You want A/R to come in as close to 30 days as possible. Ask also what percentage of A/R on average remains uncollected past 90 days. You want more than 90% collected before the 90 day mark.


  • What is the average lag in charge entry? This assesses the turnaround time for a claim after a patient visit or procedure. You want the time between the date of service and the claim entry to be as quick as possible. Ideally, this is less than 48 hours on average.



Questions to ask RCM companies regarding technology & integration


  • What software systems do you support? You want to gauge not just the platform but its ability to integrate with your existing systems (EHR, PM, etc.) without disrupting your current workflows.


  • Will I have access to a real-time dashboard and reporting? Transparency is essential for tracking performance, denials, payments, and outstanding collections so your practice can budget accordingly. If they have a real-time dashboard, see if you can get a demo of it to assess ease of use. If real-time reporting isn’t available, ask how frequently they provide performance reports, and what those reports include. You want to make sure you have a high level of transparency into the process, and that you understand how involved you will be. 


  • Do you offer a patient portal or payment platform? Supporting online bill payments can improve the patient experience and help you get paid faster.


  • Who owns my data? You should always retain ownership of your billing data. If you choose to change services or bring operations in-house in the future, you should be able to take your data with you.



Questions to ask a medical billing service to ensure compliance & security


  • How do you protect data and ensure HIPAA compliance? First and foremost, you want to ensure they are HIPPA compliant. Ask what security measures they have in place. They may cover security measures such as encryption methods, role-based access for users, and audit logs. 


  • How do you stay current with coding & regulatory changes? Understanding their staff training and access (and attention!) to up-to-date coding information can help you feel confident you’re covered.



Assessing communication & support from a potential RCM company


  • Who will be my primary point of contact? You’ll likely want a dedicated account manager or representative handling your practice. 


  • How often will we review performance reports? This can give you a high-level overview along with the day-to-day report real-time reports offer. Monthly or quarterly reporting/check-ins is typical.


  • What is your typical turnaround time for support? You want to know how quickly you can expect them to answer your questions or concerns to help prevent frustrations. Having an idea of their standard support hours is useful, as you’ll be able to determine if they’re available during your office hours for any assistance necessary.



Clarifying fees & contracts when hiring a medical billing service


  • How are your fees structured/determined? While we’ve included this section last, it’s certainly not the least important. You want to make sure you understand what pricing model (percentage based, per claim, hourly billing, etc.) they implement and what their specific pricing is.


  • What is included in that standard pricing? It’s important to know what you can expect bundled in that pricing, as well as what costs extra to get the full picture of what you might expect to pay for the level of service you desire. For example, are patient collections and mailing statements standard offerings, or do you have to add them a la carte for additional fees?


  • Is there a minimum contract length (or volume) required? While long-term contracts can offer stability, you don’t want to be locked into unfavorable terms with no (or a hefty) termination clause, especially if the services don’t live up to your expectations.



Physician Side Gigs partners for billing and coding / revenue cycle management services


If you are exploring potential billing companies, our partners at Cosentus may be able to help. Cosentus​ has been highly reviewed by several members of our communities. They can help with credentialing, billing and coding, revenue cycle management, and accounts receivable services. As part of a perk for PSG members, they offer a free professional billing and coding review as well as 5% off services through our affiliate link with the code PSG5OFF. 



Conclusion


Pricing is a critical factor when evaluating a medical billing or RCM service, but it’s far from the only factor that can help ensure a positive and successful partnership. When outsourcing these services, you’re entrusting a third-party with your practice’s financial stability and your patients’ experience and privacy. Thoroughly vetting a potential vendor can help ensure the company you choose is capable, aligned with your goals, easy to work with, and transparent.



Additional private practice resources for physicians


Explore related PSG resources:


We offer a free private practice educational series for physicians interested in virtual events to help you start and manage your practice. Sign up for our PSG weekly newsletter for alerts on upcoming events and registration links.


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