Web-based Medical Billing

Online medical billing programs use a web-based interface to provide many of the essential functions medical practices need in order to maximize their billing efficiency and/or revenues. Depending on the needs of the practice, this provides several advantages over traditional on-site software installations. This guide will provide an overview of the market and to help buyers in their decision-making process search for the right solutions.

We'll discuss the following topics:

What is Online Medical Billing Software?
What Type of Buyer Are You?
The Online Medical Billing Software Vendor Landscape

Market Trends You Should Understand
Benefits & Potential Issues
Cost & Return on Investment

What is Online Medical Billing Software?

Online medical billing software increases collections in medical offices in numerous ways - from ensuring proper claims coding and verifying insurance coverage to posting payments and generating reports. In addition tol increasing revenues by identifying previously unbilled claims, billing software automates a traditionally repetitive and error-prone task and frees up staff to focus on other activities.

Most online medical billing programs are designed for the user to submit claims electronically. More advanced systems will provide coding support, and the top-of-the-line systems will scrub claims, post payments, offer alerts, and provide for advanced reporting.

What distinguishes web-based medical billing programs from other deployment strategies is that the software is available entirely online through a web browser. This means that the information can be accessed from anywhere with an Internet connection, the user doesn’t have to worry about upgrades or coding updates, and there’s no need for a server or any other kind of IT infrastructure. And in this software-as-a-service (SaaS) model, the user pays a monthly or annual fee rather than upfront purchase cost.

What Type of Online Medical Billing Software Buyer Are You?

Most buyers of medical billing software fall into one of the following categories:

• Integrated suite buyers. This is for buyers who are looking for one integrated suite to manage their entire practice. As well as the billing modules, selection will be made based on scheduling, EMR, and PACS capabilities, usually with a very targeted focus to the medical specialty.
• Inpatient care providers. TThis includes hospitals and long-term care facilities that submit claims on UB-04 forms. Since this type of form typically requires a system designed for inpatient billing, make sure the software you select has this capability.
• Outpatient care providers. Most private practices that submit claims on the CMS-1500 forms fall into this category. Since these buyers are submitting electronic claims to Medicare, Medicaid, and private insurance companies, they’ll need something with that level of flexibility in its billing and payment structure.
• Outpatient care providers. Most private practices that submit claims on the CMS-1500 forms fall into this category. Since these buyers are submitting electronic claims to Medicare, Medicaid, and private insurance companies, they’ll need something with that level of flexibility in its billing and payment structure.
• Cash-based providers. You fall into this category if most of your revenues come from customers paying directly with cash, check, or a credit card. Since these buyers don’t submit many (if any) claims to insurance companies or to the government, their needs are much more lightweight. Chiropractors, alternative medicine providers, and certain kinds of mental health providers are the most common buyers in this category.
• Outsourced billing services. These buyers are third-party companies that submit claims on behalf of providers and receive a percentage of the collections. Typically their functional requirements will mirror those of their clients, but they may require a very broad-based, flexible system if they bill for clients with varying specialties.

The Online Medical Billing Software Vendor Landscape

While the market can appear confusing and highly fragmented, the available solutions are differentiated by their appeal to the different buyer types.

Market Trends You Should Understand

Consider the following trends as they develop and impact the medical software market:

• Mobile computing.Since healthcare providers are increasingly using tablet devices (such as the iPad) or smartphones on a regular basis, more billing systems are offering mobile compatibility. If your practice could benefit from this kind of mobility, ensure the system you select has strong mobile capabilities.
• Transition to ICD-10 codes. The ICD-9 code set is being replaced by ICD-10 on October 1, 2013. This transition will require vendors to update their codes, which makes it that much more important to ensure you’re selecting a vendor that will accommodate this significant change in billing. Many vendors don’t yet have plans to support the transition, so this is an important question to ask up front.
• ONC-ATCB Certification. Government legislation requiring the use of EMRs is impacting the EMR market, but it also affects the medical billing market. Since an integrated practice management system has so many benefits, it may be wise to select a program that incorporates all these features – or at the very least supports upgrades and/or integration with EMR systems to be adopted later.

Benefits & Potential Issues

Medical billing software is project management software is imperative for mid to large size projects. Firms that implement and make use of these systems should realize the following benefits:

• Better efficiency. Billing is a notoriously tedious task. Implementing an online medical billing system makes them more efficient at coding, submitting, and following up on claims, vastly reducing the time required.
• Improved collections and accuracy. As well as being tedious, billing is highly error-prone. Online medical billing software helps users code claims correctly and check them for errors, increasing collection rates and making them better equipped to manage rejections.
• Cost amortization. Compared to an on-site software solution, a web-based construction management program will be far less expensive in terms of up-front costs. SaaS also eliminates the need for an IT infrastructure to manage upgrades and to get the product up and running when problems arise.

An important consideration when purchasing medical billing software is the implementation plan. Every user needs to be trained on the product, and often adoption of new technology is met with resistance from people who are comfortable doing things the old way. Therefore, it’s important to get buy-in among all users to get them excited about using it.

Since SaaS programs charge a monthly or annual fee, there is the potential that the user will pay more in the long run than they will for an on-site solution. However, this tends to be the case only for larger companies with bigger budgets and dedicated IT personnel. A more significant drawback would be limited integration to external devices (e.g. ultrasounds and MRIs). If this is a concern, many of the leading client/server systems are available in an application service provider (ASP) model, which means that the system’s server is hosted at a professional data center, which effectively hybridizes the web-based model with the locally hosted one.

Costs & Return On Investment

Since the purpose of a medical billing system is to increase collections and decrease the time and effort required to receive them, the traditional measures of effectiveness for an online medical billing program are average collection timeframe and the ratio of claims accepted to rejected. The biggest benefit to SaaS applications is that they require a much lower upfront cost, since the fees that covers the licensing, technical (or billing) support, and upgrades are all monthly. Therefore, most buyers using this deployment model find the financial return on investment to be almost immediate.

Have an opinion on this guide? Email the authors. We appreciate the feedback.

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