How A Bad Biller Can Almost Bankrupt Your Practice

For those who followed my journey, you know that medical billing to insurances is a nightmare at times. I’ve now had a total of 4 different billers. The most recent biller almost did a complete financial disaster to my clinic. I swear I then had a stomach ulcer from the financial stress she put me through. Some may laugh at my desire to get my own biller. I still believe in getting an in house biller for small practices who can afford one based on volume. Sit back and let your jaw drop at how bad things got with my previous biller. This will be a cautious tale of how a bad biller can almost bankrupt your practice.

Things at their lowest were bad. How bad you might ask? We are working twice as hard for 15% less pay. Lucky for us, corrected claims do exist. We went from collecting 50k one month to one following month collecting almost a quarter million dollars.

 

My History of Billers

Hiring an external biller.

My first biller was an external group that took 4.5% of our collections. That company was not bad. I did find out the hard way that they were a bit lazy. You see, these billers have an incentive to collect the easy money. If the money is “not worth their time” then if often gets written off. They are great for micro practices. You pay little since your volume is little.

I came to learn that they were not collecting for small fees like blood draws. This may seem like it doesn’t matter, but over the course of about 6 months I had $8,000 in these small fees outstanding. Since we were collecting copays in house, this biller was also charging me 4.5% of those collections. You read that right. If I saw a cash pay patient who paid me $200 for a new visit, they collected 4.5% of that even though they had nothing to do with it.

 

Realizing My External Biller Was Lazy

 

Once I realized how lazy they were and how I was getting ripped off, I fired them.

I then brought my billing under my business structure (internal) with a shared biller with another private practice that is not in the same specialty. They immediately sent out bills for the small claims the previous biller wrote off and within 2 weeks collected $5,000! Talking about feeling good about my decision. I was on cloud nine.

Everything was going well with this biller shared with a surgeon until I got so busy that I had to hire my own biller. I had too much business and billing for my clinic to where I had to go my own separate way with a new biller.

The third biller was amazing but wanted to work from home 100% of the time. Weekly meetings about billing and collections eventually turned from talking about work, to her asking over and over again to 100% work from home. One day she told me I’m either working from home 100% of the time or you need to find a new biller. Being her boss, I was not going to let her call the shots. That day was her last day on the job since I got tired of talking about it and we no longer were talking about billing. Looking back this was somewhat a stupid decision because I let my employee keep bringing up something I told them NO on so many times. I forgot that I was writing the paychecks and should have been more in control. Lesson learned.

 

The Bad Biller

Once the good biller who wanted to work from home 100% of the time quit, I had another biller in mind who actually did the billing for another medical office in town.  I called her up and she accepted the job.

The first 3-4 months were great. However, once I got distracted with moving offices and hiring a new doctor, things quickly went downhill.

Claims were not being submitted or worse yet, she was simply writing off claims without telling me. Collections went from X to 0.5x without any clear reason. I was so busy with building the new building I didn’t notice for over 2 months.

I asked her what was going on and she only could respond with “I don’t know.”

For one week after the discovery, we both dove deep into the books and what was going on. Like an onion, the more I dug the more it hurt. Tons of write offs, tons of claims not submitted correctly, tons of claims just not even submitted. For example, if I accidently signed my note before insurance info was 100% updated in the chart then on the billing software it shows inactive insurance or no insurance. Instead of going in the chart and looking at the scanned new insurance card, she just simply wrote it off.

 

It Gets Even Worse

 

In her last days with me she changed my billed fee schedule to $20 for everything! Didn’t matter if it was a one hour new visit that normally pays $250 for complex cases or a $150 shingles vaccine. She asked for $20. Insurance was happy to pay $20 for everyone we asked for.

She also told my most difficult patients via email that we were going to write off their outstanding invoices. For her friends, she did not collect any copays and wrote them off. She did this all under my official business account.

I am currently pursuing a possible lawsuit against her for trying to possibly intentionally sabotage my collections so I will stop here at complaining.

Luckily we can submit a corrected claims. We eventually got paid a correct amount but we have been audited 30x more than usual with the number of corrected claims.

There is a sinking feeling in your chest when you see insurance paid you $20 for a new patient visit in total because that is what she put in for our fee schedule to insurance. This was only “live” for a week of billing so damage was limited. However, goes to show how much damage a bad biller can do.

 

New Biller, New Day

My new biller has been a blessing. Hell, not only a blessing but an amazing find.

A large ENT group has decided to consolidate all their billing to Dallas TX. As a result, I have hired one of the head billers that is locally near me that did not want to move. This person right away corrected the errors, resubmitted bills and got me paid quickly.

Not only that, but she changed the way I’m billing patients via notifications. Within the first 2 weeks she got me 20,000 that we previously wrote off. Needless to day, she got a nice bonus.

So far, things are back on track. I took my eyes off the books for 2 months and in that two months everything completely started to unravel. We went from “killing it” financially to “crap are we going to stay open” in just two months.

It goes to show that as a practice owner, you have to have oversite in every part of your business. Without it, when you give an inch….someone may try to take a mile and take advantage of you.

Setting Controls In Place

To prevent this from ever happening in the future I now have my wife working for the business part time. She has learned how to submit bills electronically and how to deal with insurance companies.

Every day, she checks in to see how things are going. If I did not have my wife to do this, I would most likely contract another biller to look over things once a month or maybe more often to make sure that everything is as it should be.

Without money coming into the practice, your practice can easily go belly up. I took my eyes off of billing for only 2 months and the biller who was previously doing a great job started to rapidly do a worse job every day.

Being small is tough. We are growing quickly but not so big where we have multiple billers that can keep each other in check. I would like to think we are at the critical juncture. Soon we will have 5 physician employees, so things will change quickly.

Minimizing Damage

There have been so many pissed off patient calls. We are professional and do not hide the truth. We say something like, there was an issue with billing previously and we are 100% dedicated to making it right.

 

Funny thing is, that 99% of people are totally understanding and happy to pay their bill when they call in.

So be warned. A bad biller or employee even for just 2 months can risk your practice and the health of your practice.

We are currently talking with legal counsel about filing a lawsuit against my in house biller so I really can not say too much more than I have already talked about.

6 thoughts on “How A Bad Biller Can Almost Bankrupt Your Practice

  • October 1, 2020 at 12:16 AM
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    So impressed by your success. You are an inspiration for us who have recently started or about to start a new practice.
    My wife opened her practice in first week of March and then the whole lockdown started due to covid so we were hurt right away but things are getting better now.

    Question, our outside biller asks us to not bill high complexity level 3 billing in new patients as it will “flag”us with insurance companies who will then likely start auditing our claims. I myself am a Nephrologist and we bill almost all our new patient as high level. But our biller says it’s because the specialists can do that but pcp can not,
    What are your thoughts ? If she sees new patients coming in with complaints and she orders testing and start some treatment etc , can she do high level billing? Or reserve high level for those who are very ill.
    Thank you

    Reply
    • October 1, 2020 at 1:40 PM
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      I’ve been given the same advise your wife has been given (although outpatient its a level 5 visit vs inpatient level 3 is the max level).

      I was advised that if you bill more than 25% level 5 visits you’re going to get audited. However, I know 2 specialist who almost never bill less than level 5. Right now I’m billing about 10% of our visits as level 5 and when I had an audit internally of our charts by my new biller, I’m apparently WAY underbilling by at least 15% or more on submitted claims. I am also looking into this as I do not want to overbill but I want to bill correctly for services rendered.

      Reply
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  • October 18, 2020 at 1:28 PM
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    Was there a reason you were against the good biller working from home? With respect I’m not sure the lesson learned should have been asserting role power earlier, but rather how to find an accommodation for a valuable employee whose departure apparently cost you tens of thousands of dollars and threatened the viability of your business, and/or not letting a single position have such a critical impact on your business.

    Reply
    • October 18, 2020 at 8:28 PM
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      This is a very good, wonderful question. Before I hired her, she did ask me if I was willing to have her work from home. I did say that that was a potential in the future.

      Whenever she started working for me, immediately it turned from how many days a week she can actually work from home. Before we even started talking about how to bill, how I want things to go, she started talking about working from home.

      I told her that I wanted to try a month or two of working from The office and then I would be open to working from home. She didn’t seem to respect that. Right away, the next meeting, it was nothing but why can’t I work from home.

      In retrospect she was a wonderful biller. However, instead of talking about billing, 90% of our conversations were spent about talking about her working from home and why she is not working from home.

      There was a point where I got upset because I felt like she was making so many demands and more or less in control of every conversation we had, that I had to cut ties with her in my mind because I lost all credibility as a boss for her.

      She would steam roll me with every talk we had.

      So, she is a wonderful biller for the work she does but my expectations and her expectations did not line up.

      I had it stuck in my mind that I wanted to have a face-to-face biller that I could talk to for the first couple of months to tell them how I wanted things to work but she wanted to do remote right away.

      In retrospect, it did cost me a ton of money. I should have been more open-minded but at the same time I want to maintain some control over the clinic and she is not the type of person that I envision being a head biller. When someone does a wonderful job, sometimes you have to get out of their way. But, when the very first discussions completely broke down and all we talked about was her work from home, I just realized that personality trait wasn’t for me.

      It worked out fine for me in the end. We ended up recouping all of our money, I have a biller now that is 10 times better than any bill that we’ve ever had and making twice as much money as we’ve ever had. It was a stressful journey though.

      Reply
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