Billing Software vs. RCM Service: What's the Difference, and What's Right for Your Practice?

Billing is one of the most complicated aspects of running a clinic. From coding to submitting claims (and having some of those claims denied), every time you think you’ve got things figured out, the rules change again. Even if you’re running a cash-pay practice, there are probably a few billing chores you have to handle in order for your patients to get reimbursed. But a good billing operation is essential to financial stability, and effective claims management can make all the difference in your practice’s financial health.

Normally, we daydream about the ability to wish away our most tedious administrative tasks—but in the case of billing for a healthcare organization, that dream can be a reality. Rehab therapists today have the option of keeping their billing in-house with billing software or choosing a revenue cycle management (RCM)service to handle everything for them. So what’s the right option in the ongoing debate of billing software vs. RCM service? Well, it depends on what you want—and what you need.

Billing Software

Yes, billing can be a headache, but there’s something reassuring about having your billing processes under control — especially with your knowledgeable staff. Sure, you’re responsible for every step of the process, but because you’ve opted for the hands-on approach, you can tackle any issue that arises right away. And if you’ve got a capable biller on your staff and efficient processes in place, you don’t have to worry about billing becoming a sticking point at your practice.

If you’re looking at your budget, using medical billing software potentially costs less than a billing service — although you do have to consider the time and effort you’re putting into your billing processes as part of your cost-benefit analysis. (After all, as a skilled professional in an increasingly busy profession, your time is valuable.) Another cost-saving and efficiency-boosting measure is finding a billing software that integrates with your EMR — and the resort of your practice management tools. That way, you don’t have to worry about any double entry of codes and demographic information—which is especially important with complicated ICD-10 coding.

Of course, if you’re going to choose a billing software, you want one that’s going to make things easier for your billing team, with features like claims scrubbing to avoid unnecessary claim denials and payment delays, a client portal so outstanding patient statements can be paid without your team, and robust reporting and risk management so that you can stay on top of unpaid claims your A/R. If you’re a bigger practice with a few locations and a lot of providers, you want to be able to take advantage of institutional billing, advanced reporting and data analytics, scalable enterprise workflows, and concurrent case management and tasking.

WebPT offers a couple of self-service billing options: Therabill and WebPT Billing. Why two? Well, different practices of different sizes have different needs, and we have solutions tailored to meet those needs:

Therabill is designed for smaller clinics that aren’t billing Medicare Part A and have:

• Fewer than 2,000 visits a month
• One tax ID
• One or two in-house billing specialists

WebPT Billing, on the other hand, is for larger organizations that deal with Part A patients and are also:

• Seeing more than 2,000 visits per month;
• Using more than one tax ID;
• Billing for Medicare patients under Medicare Part A; or
• Using a team of three or more dedicated billers.

Implementing the right billing software is crucial for the financial management of a rehab therapy practice, ensuring streamlined operations across multiple providers and sites.

RCM Service

If you’re tired of the billing tedium and want to take that off your team’s plate so you can spend your time elsewhere, RCM services are ready to pick up the slack and handle the entire revenue cycle management process for you. Revenue cycle management services are increasingly being utilized by practices to streamline and automate the billing and financial processes, ensuring a more efficient management of the revenue cycle.

On its face, having an outsourced team of revenue cycle management pros working for your practice seems like a no-brainer. However, there’s one major factor you have to consider with this option: cost. Most revenue cycle management services charge a percentage of collections (typically 6-12%), which means the more money you bring in, the more you pay out. That can potentially cause your budget and expenses to fluctuate if you experience cash flow variations due to changes in your monthly patient volume.

That said, if you have a specialized team of RCM experts on your side, the costs don’t have to outweigh the benefits. As this Greenway Health resource explains, “A good RCM vendor will be able to demonstrate an ROI.” But, there’s more to this decision than financial ROI. Case in point: Practices that switch to an RCM service typically experience a reduced billing burden—and that means fewer headaches. When you outsource your billing to a professional service with billing experts, you don’t have to worry about staffing or the time-consuming claims process, which includes maximizing reimbursements and combating denials for services rendered. Additionally, you can count on timely accounts receivable (AR) collections and a staff of experts who remain up to date on the latest regulations, which can prove vital when it comes to Medicare compliance. (Modifiers, anyone?)

How do I make the right decision?

Deciding between billing software and RCM services is crucial for managing medical billing processes efficiently and ensuring your practice's financial health. So, which option should your clinic choose? Should you follow the dollar signs? Well, when it comes to billing operations, you’ll have to consider more than cost. Here are some questions you can ask yourself to help with the decision-making process:

• Do I have an efficient process in place?
• Is that process meeting my clinic’s needs?
• Does processing my billing in-house sound like a good fit?
• If so, do I have someone capable, well-trained, and technically savvy on staff to process my billing?
• If not, am I ready to hire someone who is?
• Do I love a hands-on approach to all things billing?
• Does a billing service sound like a good fit?
• If so, am I comfortable with letting an outside team handle my billing?
• What are my monthly collections?
• Can my clinic afford 6-12% of those collections as payment for a billing service?
• How will each option impact my practice's ability to engage in effective revenue generation?

The answers to these questions should help you form a decision. If you already have a process in place, and it’s efficient and cost-effective, that’s awesome. (Just make sure you’re regularly auditing it.) If not, then you might need to restructure how you do things—which can be scary, but absolutely doable. The ultimate goal of any billing process is to maximize payments and get that revenue flowing, so rest assured that while choosing a path can be a chore, there’s light at the end of the tunnel—with no billing monsters in sight.