After several months of working with your outsourced dental billing company, you might be thinking, “Is outsourced dental billing working? Am I getting my money’s worth?” Hey, that’s a fair question! And now that enough time has passed, you’ll want to check your billing performance metrics. What are billing metrics? How is billing performance measured?
There are a few key performance indicators to answer these questions, and some qualitative checks, too.
As a dental billing company, we encourage dental teams to understand KPIs (key performance indicators) and healthy benchmarks for collection rates when working with Dental ClaimSupport.
And of course, there are human factors to check - does your dental administrative team get along with your outsourced billing team?
After a few months, you should begin seeing results of a higher collections percentage and lower A/R percentage over 30 days. These are just two KPIs that can help you rest assured that you made the right decision to outsource your dental billing process.
But how do you go about evaluating your outsourced dental billing company?
In this article, we will walk you through why it’s important to evaluate your dental billing company and how you should do so. You should know that your choice to outsource was the right one, and taking the time to regularly review the performance of your outsourced billers and their relationship with your administrative team is the best place to start.
You deserve to know that your insurance billing is in the right hands. So let’s dive in.
1. Watch your collection percentage and insurance A/R
Technically you should already be regularly running specific financial reports to review the performance of your dental practice as a whole. But you can run specific reports to see how your outsourced dental billing company is performing.
This is the most important way to evaluate the performance of your outsourced billers. It’s cold hard facts, and it gets straight the question:
Is the outsourced dental billing company meeting important performance goals?
Focus on your insurance collections report and insurance aging report
Here are the top two KPIs and reports to run that will let you know how your dental billing system is doing:
- Collection Percentage (or collection rate)
- 30, 60, and 90-day insurance A/R (aging report)
1. Collections report. Your insurance collection report tells you the total dollar amounts you have received as insurance claims payments and payments from patients. You’ll want to know, is that good? You need to know how much in production you actually collected from insurance and patients. That’s your insurance collection percentage.
You may have to calculate your collection percentage, and the math is straightforward. Insurance payments often account for more than half of your revenue.
Is your insurance collection percentage higher than it was before you hired the outsourced dental billing company? Ideally, you should have noted what your insurance collections percentage was when you decided to outsource. If this number has not increased or has decreased since outsourcing, you should bring it up to your point of contact at the dental billing company.
As a reminder, here is how you calculate your insurance collections percentage:
Total Insurance Collections / Total net (adjusted) Production = Insurance Collections Percentage
For a more in-depth explanation of how to calculate your insurance and patient collections percentage, visit our blog article, “How to Increase your Collections Percentage.”
2. Insurance aging report. The insurance aging report or outstanding claims report is a list of unpaid claims and how much time has passed since you filed for payment. This report groups outstanding claims by age: those 30, 60, and 90 days past their submission date. Ideally, you don’t want to see any unpaid claims go past the 30-day mark. A good dental billing company will make sure any uncollected claims over 30 days are less than 10% of your total outstanding claims.
Your outsourced dental billing company works on the outstanding insurance claims report by noticing trends, working smart, and problem-solving, then going line by line. claim by claim and working to get them paid.
This report should be worked weekly. Ideally, the dental billing company will keep any claim from hitting the 90+ category. The reason being most insurance plans include timely filing limits.
As a reminder on how to run your aging report in a few different popular software programs, visit our blog article, “How to run an outstanding dental insurance aging report.” It will cover how to run this report in Dentrix, OpenDental, and Eaglesoft.
With the numbers on these reports, you will get a crystal clear picture of the technical work the outsourced billers are doing.
2. Ask your administrative team
While the numbers are the most important indicator of how your outsourced dental billing team is performing, the thoughts and opinions of your administrative team are also valuable.
Here’s the caveat: we recommend asking the administrative team how they feel about the outsourced dental billing company after you’ve given them plenty of time to adjust to the change. Why is that?
At first, it’s pretty common for in-house dental teams to feel resistant to the change that comes with hiring on a dental billing company. If the transition is fresh, your team might have a hard time being objective when it comes to the performance of the dental billing company.
But their thoughts are important. You, as the business owner, just need to make sure you’re taking the timing into consideration. The big picture is important here.
Some billing companies are not a good fit with your dental team
This is a mutual working relationship between the remote biller and the in-house dental administrative team.
If the dental billing team does not get along with the administrative team or vice-versa, that’s certainly something to address when you are evaluating your dental billing company.
For example, if there is a miscommunication happening that could probably be solved, but the two parties simply do not see eye-to-eye, it’s perfectly reasonable to consider that when deciding to continue this service. Outsourced dental billing is not the perfect billing solution for everyone, plus - there might be a different billing company that fits your needs better.
3. Ask your point of contact for feedback - a monthly check-in is welcomed!
To get a well-rounded evaluation of how the outsourced dental billing company is performing, not only should you ask your in-house team, ask your point of contact at the billing company.
A good dental billing company is going to let you know exactly how the relationship between the administrative team and their billers has been going. If you ask they will likely even walk through your financial reports with you.
You can also bring up any issues or complaints you may have with your remote biller and try to come up with a solution. Or - you can decide what the root of the problem is and conclude that this relationship might not be working for either of you. Either way, this clear line of honest communication is important for a healthy partnership.
Ready to work successfully with your outsourced dental billing company?
Regularly evaluating and reviewing the performance of your outsourced dental billing is how you confirm to yourself as a dentist, and to your in-house team that you made the right decision. Outsourcing your dental billing can be a profitable resource to dental practices when there is healthy communication between the two.
Dental ClaimSupport has regular check-ins with dental teams to show the progress that has been made by the remote billers. No matter the dental billing company you work with - it’s important that you do the same, for the sake of your practice’s financial success.
To learn more about how to work successfully with a dental billing company, visit our Learning Center.
Related Posts
Dental billing resources