It’s hard to understate the impact that COVID-19 has had on the healthcare industry. From independent physicians to major hospital groups, it seems that no sector has escaped the devastating financial consequences of the pandemic.

The government has implemented financial stimulus packages like the Coronavirus Aid, Relief, and Economic Security Act (CARES) to help healthcare providers weather these difficult times. However, with the end of the pandemic nowhere in sight, many are questioning how long they can realistically rely on such support. For medical practices and smaller organizations, the answer may lie in outsourcing.

Why outsourcing makes sense during COVID-19 and beyond

In medical practices, charges have taken a major hit. The Medical Group Management Association (MGMA) found that practices experienced an average drop of 55% in revenue and 60% in patient volumes, with serious effects on the bottom line.

While those with outsourced billing operations certainly haven’t been immune to the financial impact of COVID-19, they do seem to have fared better than their counterparts with in-house billing. Why is this?

Even during ordinary times, outsourcing medical billing can help boost your bottom line by:

• Increasing charge accuracy
• Improving collection rates
• Decreasing cost to collect
• Reducing denials and rejections
• Streamlining billing processes

It also helps to significantly reduce overheads, a benefit that has offered a lifeline to many practices during COVID-19.

Practices with in-house billing teams have still had to pay for employee salaries and benefits, even when mandatory shutdowns had brought cashflow screeching to a halt. They’ve also had to navigate the security, management, and logistical issues of having their staff work from home, and meet the cost of additional PPE when they were required to be on-site.

This has not been the case for practices that use third-party billing companies. Practices would typically be paying the company a percentage of net collections, so when charges and revenue dropped, so did the practice’s medical billing expenses. The billing provider was also responsible for the cost (and stress!) of transitioning their employees to secure, compliant home working.

The indirect benefits of outsourcing

Outsourcing has helped medical practices to protect their revenue cycle indirectly, too. Practice owners and managers have been able to take the time and money saved by outsourcing, and invest it in activities that give their businesses a better chance of survival, such as telemedicine provision.

This is critical because again, the end is nowhere in sight. It’s impossible to know what the pandemic is going to bring in three months, or six months, or a year, so you can’t predict when the next government shutdown will bring your business grinding to a halt again. What you can do, though, is fortify your revenue cycle right now, and outsourcing is a great place to start.

Don’t wait for the next shutdown.

We all pray another shutdown won’t happen, but you want your practice to be in the best position possible if it does. A strong practice is built on a strong revenue cycle, which is what we do best here at Ideal Practice Solutions.  

With over 50 years’ experience in medical billing and revenue cycle management, we’re using our expertise to help our clients weather the COVID-19 pandemic and come out stronger. We can help you do the same. Schedule a consultation and get a free practice analysis now (worth $2500.00).