Outsource billing, coding to get best use of staff

Improved cash flow and increased productivity

The detail and precision required to code and submit claims to Medicare keeps increasing, and smaller home health agencies struggle to stay on top of continuous changes. One solution sought by many agency managers is to outsource some or all of the coding and billing activities of the agency.

"My director of nursing was handling the coding for all of our claims, but as our census grew, it became harder for her to code in a timely manner and oversee the nursing staff," says Ryan Coe, administrator of Coe Home Health in Mansfield, TX. "Time-wise, switching to an outside vendor for our coding activities not only gave my director of nursing more time for clinical responsibilities, but it also improved cash flow," he says. The vendor selected by Coe [HealthCarefirst, Ozark, MO] codes claims on the first day, he points out. "This improves cash flow, because we can send the bills out immediately rather than two or three days later," he says.

While Coe chooses to outsource the coding and handle the billing within his agency, Margaret Carson, executive director of Angelic Home Health and Hospice in Tulsa, OK, handles the coding in-house and has an outside vendor do the billing. "When I first opened the agency, I was wearing eight different hats, and it was difficult to pay close attention to the details of billing," she explains. Now, the information is sent to the vendor, which submits the claims to Medicare, then sends Carson a billing summary report so that her staff can track accounts payable. "They quickly identify missing information that might slow payment and get with us to obtain the extra information," she adds.

Cash flow is much improved now that the agency is able to bill consistently every 15 days with no problems, says Carson. "It is also much easier to respond to Medicare requests for additional information when we only have to look back over a 15-day period," she adds.

In addition to the time savings and improved cash flow that both home health managers noticed, there are other benefits to outsourcing some administrative functions. "Managers or owners of startup agencies can benefit from the expertise of a company that has done this for years and seen almost every situation that can occur," says Carson. "I quickly learned that Medicare was not able to offer me the assistance I needed, so the vendor was essential."

Using an outside source to handle a process that requires ongoing education to address changes and updates also saves money on benefits and salary for an employee, points out Coe. By outsourcing his coding function, Coe's cash flow and billing accuracy improved to the point that he was able to show enough profit to justify hiring a full-time marketing person, who has helped the agency increase the two-year-old agency's census fourfold, he says.

Both Carson and Coe selected a vendor that offered a web-based product rather than a software-based product. "I liked the versatility of the web-based system, because I wasn't tied to one computer or one office in order to receive or send information," says Coe. Because Coe spends time traveling to and from different locations, the ability to access the system remotely from any location was critical. "I also looked for a user-friendly system that would be easy for several people to learn to use and for a company that offered customer support on an ongoing basis," he explains.

"I looked for a company that matched my philosophy of how to do business," says Carson. Good rapport with people at the company also makes life easier, she adds. "I also wanted a company that specialized in home health, because that means that they can use experience from other clients to offer advice to me."


For information about outsourcing billing and coding services, contact:

• Ryan Coe, Administrator, Coe Home Health, 923 Riviera Drive, Mansfield, TX 76063. Phone: (817) 842-4263. Fax: (817) 842-4264. E-mail: rcoe@coehomehealth.com.

• Margaret Carson, Executive Director, Angelic Home Health and Hospice, 3790 S Elm Place, Broken Arrow, OK 74011. Phone: (918) 622-3800. E-mail: mcarson@tulsacoxmail.com.

• HealthCarefirst, 850 North 25th Street, Ozark, MO 65721.Phone: (800) 841-6095. Fax: (417) 485.3046. E-mail: info@healthcarefirst.com. Web site: www.healthcarefirst.com.