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Outsourcing certain staff functions in a practice to outside contractors working in remote locations has become commonplace in many medical practices.
Health care outsourcing services, also known as virtual assistants (VAs), were already booming in 2017, when volume grew by 36%. Then, the COVID-19 pandemic in 2020 normalized off-site work, which was a boon to outsourcing providers.
The most popular services being outsourced today by medical practices include billing, scribes, telephone calls to patients, and processing prior authorizations.
“Outsourcing is not for everyone, but I’ve seen it work for many practices,” said Lara Hochman, MD, a practice management consultant in Austin, Tex. She said that practices have used outsourcing to solve problems like high staff turnover, tight budgets, and inefficient use of staff.
When in-house staffing is insufficient or not appropriately aligned with the task, outsourcing can produce big savings, said Teri Deabler, a practice management consultant with the Texas Medical Association.
For example, she said that a client was paying an in-house accountant $80,000 a year. When the accountant retired, she was replaced with a part-time bookkeeper earning $20,000 while her accounting work was outsourced at a cost of $20,000 a year. “The practice’s costs for this service were cut in half,” Ms. Deabler said.
What functions lend themselves to outsourcing?
Clinical services are rarely outsourced by individual practices – although hospitals now outsource numerous clinical services – but virtually any kind of administrative service can be contracted out. Outsourcing used to be limited mainly to billing and off-hours phone services, but today, more services are available, such as scribing, processing prior authorizations, accounting and bookkeeping, human resources (HR) and payroll, interactions with social media, recredentialing, medical transcription, and marketing.
Meanwhile, the original outsourced services have evolved. Billing and collections may now be handled by off-shore VAs, and phone services now deal with a wider variety of tasks, such as answering patients’ questions, scheduling appointments, and making referrals.
Ron Holder, chief operating officer of Medical Group Management Association in Englewood, Colo., said that some outsourcing services can also adjust the amount of work provided based on the customer’s needs. “For instance, an IT outsourcer may allow you to scale up IT support for a new big tech project, such as installing a new electronic health record,” he said.
The outsourced service provider, who might work in another state or another country, is connected to the practice by phone and electronically, and represents the practice when dealing with patients, insurers, or other vendors.
“No one, including patients and your physicians, should know that they are dealing with an outsourced company,” said Mr. Holder. “The work, look, and feel of the outsourced functions should be seamless. Employees at the outsourcer should always identify themselves as the practice, not the outsourcing service.”
Dr. Hochman said that many outsourcing companies dedicate a particular worker to a particular practice and train them to work there. One example of this approach is Provider’s Choice Scribe Services, based in San Antonio. On its website, the company notes that each scribe is paired with a doctor and learns his or her documentation preferences, EMR use, and charting requirements.
What medical practices benefit most from outsourcing?
All kinds and sizes of practices contract with outsourcing firms, but the arrangement is particularly useful for smaller practices, Mr. Holder said. “Larger practices have the economies of scale that allow services to be in-house,” he said, “but smaller practices don’t have that opportunity.”
Dr. Hochman added that outsourcing firms can be hired part-time when the practice doesn’t have enough work for a full-time position. Alternatively, a full-time outsourcing firm can perform two or more separate tasks, such as scribing while handling prior authorizations, she said.
Outsourcing is also useful for new practices, Ms. Deabler said. “A new practice is not earning much money, so it has to have a bare-bones staff,” she said. “Billing, for example, should be contracted out, but it won’t cost that much, because the outsourcer typically charges by volume, and the volume in a new practice is low.”
Meanwhile, Mr. Holder said that the outsourcing of prior authorization work can particularly benefit specialty practices because they typically have a lot of prior authorizations to deal with.
The pros and cons of outsourcing
Experts with experience in outsourcing agree there are both pluses and minuses. “Practices with outsourced workers have less overhead, don’t have to deal with staff turnover, and costs may be lower than for in-house staff,” Ms. Deabler said. “However, you have limited control over outsourced workers and the practice may seem more anonymous to patients, so you need to consider this option very carefully.”
“With outsourcing, you lose control,” said John Machata, MD, a recently retired solo family physician in Wickford, R.I. “You’re trusting someone else to do work that you could do anyway.”
When he briefly considered outsourcing the practice’s billing many years ago, he found that billing companies wouldn’t handle bills that took a lot of work, such as getting in touch with the insurance company and explaining the patient’s situation. “They would only handle the easy bills, which the practice could do anyway,” he said.
However, he does think that answering services may be useful to outsource. “Patients are more inclined to call an anonymous entity than the doctor,” he said. When he gave patients his cell phone number, he said that some patients held off from calling because they didn’t want to bother him.
“Outsourced staff should be less expensive than in-house staff,” said Daniel Shay, an attorney at Gosfield & Associates in Philadelphia. “On the other hand, you are liable for the outsourcer’s mistakes. If your outsourced billing company is upcoding claims, your practice would be on the hook for repayment and penalties.”
Mr. Holder said: “An outsourcer ought to be more efficient at its chosen task because that is what they know how to do. This is a plus at a small practice, where the practice manager may need to do the billing, HR, IT, marketing, some legal work, and accounting,” he said. “No one person can do all of those things well.”
He added, however, “If you choose outsourcing and then decide you don’t like it, it’s difficult to unwind the arrangement. Staff that have been dismissed can’t easily be hired back, so it shouldn’t be an easy decision to make.”
Also, sometimes the staff at offshore outsourcing firms may have accents that are harder for patients to understand, and the offshore staff may not readily understand a U.S. caller. However, Dr. Hochman said that practices often have a chance to interview and select specific persons on the offshore team who best fit their needs.
Offshore outsourcing
Outsourcing firms have been moving abroad, where costs are lower. Typical venues are India and the Philippines because there are larger percentages of people who speak English. Since 2020, demand at offshore medical billing companies has been growing faster than their domestic counterparts, according to a recent analysis.
The difference in price can be substantial. In 2020, the average salary for scribes in India was $500 a month, compared with $2,500 for scribes in the United States.
However, offshore outsourcing is starting to face limitations in some places because of privacy issues, according to David J. Zetter, a practice management consultant in Mechanicsburg, Pa. He pointed to a new Florida law that limits use of offshore vendors because they deal with confidential patient information. The law, which became effective July 1, requires that any protected health information must be maintained in the United States or Canada.
“This will make it very hard for many types of offshore vendors to operate in Florida,” he said. He noted that Florida is the only state with such a restriction, but similar proposals are under consideration in a few other states, such as Texas.
How to select the right company
Mr. Zetter said that the biggest mistake practices make when choosing a company is failing to take enough time to examine their choice. “Quite often, practices don’t validate that companies know what they are doing,” he said. “They get a recommendation and go with it.”
“Choose a company with experience in your specialty,” Mr. Zetter advised. “Speak with the company’s clients, not just the ones the company gives you to speak to. You should ask for the full list of clients and speak to all of them.”
Ms. Deabler said that it’s fairly easy to find respected outsourcing companies. “Colleagues can make recommendations, state and specialty societies can provide lists of preferred vendors, and you can visit vendors’ booths at medical conferences,” she said. She added that it’s also easy to find evaluations of each company. “You can Google the company and come up with all kinds of information about it,” she said.
Mr. Shay said that practices should make sure they understand the terms of the contract with a VA. “Depending on how the contract is worded, you may be stuck with the relationship for many years,” he said. “Before you sign an outsourcing contract, you need to make sure it has a reasonable termination provision.”
Because vetting companies properly can require extensive work, Ms. Deabler said, the work can be given to an experienced practice management consultant. “The consultant can start with a cost-benefit analysis that will show you whether outsourcing would be worthwhile,” she said.
Working with outsource service providers
Mr. Holder said that doctors should keep track of what the outsourcer is doing rather than simply let them do their work. “For example, doctors should understand the billing codes they use most often, such as the five levels of evaluation and management codes, and not just blindly rely on the billing company to code and bill their work correctly,” he noted.
Ms. Deabler said that companies provide monthly reports on their work. “Doctors should be reading these reports and contacting the company if expectations aren’t met,” she said.
Even in the reports, companies can hide problems from untrained eyes, Mr. Holder said. “For example, anyone can meet a metric like days in accounts receivable simply by writing off any charge that isn’t paid after 90 days.”
“You need to be engaged with the outsourcer,” he said. “It’s also a good idea to bring in a consultant to periodically check an outsourcer’s work.”
Will outsourcing expand in the future?
Mr. Holder said that the increasing use of value-based care may require practices to rely more on outsourcing in the future. “For instance, if a practice has a value-based contract that requires providing behavioral health services to patients, it might make sense to outsource that work rather than hire psychologists in-house,” he said.
Practices rarely outsource clinical services, but Mr. Holder said that this may happen in the future: “Now that Medicare is paying less for telehealth, practices have to find a way to provide it without using expensive examining room space,” he said. “Some practices may decide to outsource telehealth instead.”
Mr. Shay said that there are many reasons why outsourcing has a strong future. “It allows you to concentrate on your clinical care, and it is a solution to problems with turnover of in-house staff,” he said. “It can also be more efficient because the service is presumably an expert in areas like billing and collections, which means it may be able to ensure more efficient and faster reimbursements. And if the work is outsourced overseas, you can save money through lower worker salaries.”
A version of this article first appeared on Medscape.com.
Outsourcing certain staff functions in a practice to outside contractors working in remote locations has become commonplace in many medical practices.
Health care outsourcing services, also known as virtual assistants (VAs), were already booming in 2017, when volume grew by 36%. Then, the COVID-19 pandemic in 2020 normalized off-site work, which was a boon to outsourcing providers.
The most popular services being outsourced today by medical practices include billing, scribes, telephone calls to patients, and processing prior authorizations.
“Outsourcing is not for everyone, but I’ve seen it work for many practices,” said Lara Hochman, MD, a practice management consultant in Austin, Tex. She said that practices have used outsourcing to solve problems like high staff turnover, tight budgets, and inefficient use of staff.
When in-house staffing is insufficient or not appropriately aligned with the task, outsourcing can produce big savings, said Teri Deabler, a practice management consultant with the Texas Medical Association.
For example, she said that a client was paying an in-house accountant $80,000 a year. When the accountant retired, she was replaced with a part-time bookkeeper earning $20,000 while her accounting work was outsourced at a cost of $20,000 a year. “The practice’s costs for this service were cut in half,” Ms. Deabler said.
What functions lend themselves to outsourcing?
Clinical services are rarely outsourced by individual practices – although hospitals now outsource numerous clinical services – but virtually any kind of administrative service can be contracted out. Outsourcing used to be limited mainly to billing and off-hours phone services, but today, more services are available, such as scribing, processing prior authorizations, accounting and bookkeeping, human resources (HR) and payroll, interactions with social media, recredentialing, medical transcription, and marketing.
Meanwhile, the original outsourced services have evolved. Billing and collections may now be handled by off-shore VAs, and phone services now deal with a wider variety of tasks, such as answering patients’ questions, scheduling appointments, and making referrals.
Ron Holder, chief operating officer of Medical Group Management Association in Englewood, Colo., said that some outsourcing services can also adjust the amount of work provided based on the customer’s needs. “For instance, an IT outsourcer may allow you to scale up IT support for a new big tech project, such as installing a new electronic health record,” he said.
The outsourced service provider, who might work in another state or another country, is connected to the practice by phone and electronically, and represents the practice when dealing with patients, insurers, or other vendors.
“No one, including patients and your physicians, should know that they are dealing with an outsourced company,” said Mr. Holder. “The work, look, and feel of the outsourced functions should be seamless. Employees at the outsourcer should always identify themselves as the practice, not the outsourcing service.”
Dr. Hochman said that many outsourcing companies dedicate a particular worker to a particular practice and train them to work there. One example of this approach is Provider’s Choice Scribe Services, based in San Antonio. On its website, the company notes that each scribe is paired with a doctor and learns his or her documentation preferences, EMR use, and charting requirements.
What medical practices benefit most from outsourcing?
All kinds and sizes of practices contract with outsourcing firms, but the arrangement is particularly useful for smaller practices, Mr. Holder said. “Larger practices have the economies of scale that allow services to be in-house,” he said, “but smaller practices don’t have that opportunity.”
Dr. Hochman added that outsourcing firms can be hired part-time when the practice doesn’t have enough work for a full-time position. Alternatively, a full-time outsourcing firm can perform two or more separate tasks, such as scribing while handling prior authorizations, she said.
Outsourcing is also useful for new practices, Ms. Deabler said. “A new practice is not earning much money, so it has to have a bare-bones staff,” she said. “Billing, for example, should be contracted out, but it won’t cost that much, because the outsourcer typically charges by volume, and the volume in a new practice is low.”
Meanwhile, Mr. Holder said that the outsourcing of prior authorization work can particularly benefit specialty practices because they typically have a lot of prior authorizations to deal with.
The pros and cons of outsourcing
Experts with experience in outsourcing agree there are both pluses and minuses. “Practices with outsourced workers have less overhead, don’t have to deal with staff turnover, and costs may be lower than for in-house staff,” Ms. Deabler said. “However, you have limited control over outsourced workers and the practice may seem more anonymous to patients, so you need to consider this option very carefully.”
“With outsourcing, you lose control,” said John Machata, MD, a recently retired solo family physician in Wickford, R.I. “You’re trusting someone else to do work that you could do anyway.”
When he briefly considered outsourcing the practice’s billing many years ago, he found that billing companies wouldn’t handle bills that took a lot of work, such as getting in touch with the insurance company and explaining the patient’s situation. “They would only handle the easy bills, which the practice could do anyway,” he said.
However, he does think that answering services may be useful to outsource. “Patients are more inclined to call an anonymous entity than the doctor,” he said. When he gave patients his cell phone number, he said that some patients held off from calling because they didn’t want to bother him.
“Outsourced staff should be less expensive than in-house staff,” said Daniel Shay, an attorney at Gosfield & Associates in Philadelphia. “On the other hand, you are liable for the outsourcer’s mistakes. If your outsourced billing company is upcoding claims, your practice would be on the hook for repayment and penalties.”
Mr. Holder said: “An outsourcer ought to be more efficient at its chosen task because that is what they know how to do. This is a plus at a small practice, where the practice manager may need to do the billing, HR, IT, marketing, some legal work, and accounting,” he said. “No one person can do all of those things well.”
He added, however, “If you choose outsourcing and then decide you don’t like it, it’s difficult to unwind the arrangement. Staff that have been dismissed can’t easily be hired back, so it shouldn’t be an easy decision to make.”
Also, sometimes the staff at offshore outsourcing firms may have accents that are harder for patients to understand, and the offshore staff may not readily understand a U.S. caller. However, Dr. Hochman said that practices often have a chance to interview and select specific persons on the offshore team who best fit their needs.
Offshore outsourcing
Outsourcing firms have been moving abroad, where costs are lower. Typical venues are India and the Philippines because there are larger percentages of people who speak English. Since 2020, demand at offshore medical billing companies has been growing faster than their domestic counterparts, according to a recent analysis.
The difference in price can be substantial. In 2020, the average salary for scribes in India was $500 a month, compared with $2,500 for scribes in the United States.
However, offshore outsourcing is starting to face limitations in some places because of privacy issues, according to David J. Zetter, a practice management consultant in Mechanicsburg, Pa. He pointed to a new Florida law that limits use of offshore vendors because they deal with confidential patient information. The law, which became effective July 1, requires that any protected health information must be maintained in the United States or Canada.
“This will make it very hard for many types of offshore vendors to operate in Florida,” he said. He noted that Florida is the only state with such a restriction, but similar proposals are under consideration in a few other states, such as Texas.
How to select the right company
Mr. Zetter said that the biggest mistake practices make when choosing a company is failing to take enough time to examine their choice. “Quite often, practices don’t validate that companies know what they are doing,” he said. “They get a recommendation and go with it.”
“Choose a company with experience in your specialty,” Mr. Zetter advised. “Speak with the company’s clients, not just the ones the company gives you to speak to. You should ask for the full list of clients and speak to all of them.”
Ms. Deabler said that it’s fairly easy to find respected outsourcing companies. “Colleagues can make recommendations, state and specialty societies can provide lists of preferred vendors, and you can visit vendors’ booths at medical conferences,” she said. She added that it’s also easy to find evaluations of each company. “You can Google the company and come up with all kinds of information about it,” she said.
Mr. Shay said that practices should make sure they understand the terms of the contract with a VA. “Depending on how the contract is worded, you may be stuck with the relationship for many years,” he said. “Before you sign an outsourcing contract, you need to make sure it has a reasonable termination provision.”
Because vetting companies properly can require extensive work, Ms. Deabler said, the work can be given to an experienced practice management consultant. “The consultant can start with a cost-benefit analysis that will show you whether outsourcing would be worthwhile,” she said.
Working with outsource service providers
Mr. Holder said that doctors should keep track of what the outsourcer is doing rather than simply let them do their work. “For example, doctors should understand the billing codes they use most often, such as the five levels of evaluation and management codes, and not just blindly rely on the billing company to code and bill their work correctly,” he noted.
Ms. Deabler said that companies provide monthly reports on their work. “Doctors should be reading these reports and contacting the company if expectations aren’t met,” she said.
Even in the reports, companies can hide problems from untrained eyes, Mr. Holder said. “For example, anyone can meet a metric like days in accounts receivable simply by writing off any charge that isn’t paid after 90 days.”
“You need to be engaged with the outsourcer,” he said. “It’s also a good idea to bring in a consultant to periodically check an outsourcer’s work.”
Will outsourcing expand in the future?
Mr. Holder said that the increasing use of value-based care may require practices to rely more on outsourcing in the future. “For instance, if a practice has a value-based contract that requires providing behavioral health services to patients, it might make sense to outsource that work rather than hire psychologists in-house,” he said.
Practices rarely outsource clinical services, but Mr. Holder said that this may happen in the future: “Now that Medicare is paying less for telehealth, practices have to find a way to provide it without using expensive examining room space,” he said. “Some practices may decide to outsource telehealth instead.”
Mr. Shay said that there are many reasons why outsourcing has a strong future. “It allows you to concentrate on your clinical care, and it is a solution to problems with turnover of in-house staff,” he said. “It can also be more efficient because the service is presumably an expert in areas like billing and collections, which means it may be able to ensure more efficient and faster reimbursements. And if the work is outsourced overseas, you can save money through lower worker salaries.”
A version of this article first appeared on Medscape.com.
Outsourcing certain staff functions in a practice to outside contractors working in remote locations has become commonplace in many medical practices.
Health care outsourcing services, also known as virtual assistants (VAs), were already booming in 2017, when volume grew by 36%. Then, the COVID-19 pandemic in 2020 normalized off-site work, which was a boon to outsourcing providers.
The most popular services being outsourced today by medical practices include billing, scribes, telephone calls to patients, and processing prior authorizations.
“Outsourcing is not for everyone, but I’ve seen it work for many practices,” said Lara Hochman, MD, a practice management consultant in Austin, Tex. She said that practices have used outsourcing to solve problems like high staff turnover, tight budgets, and inefficient use of staff.
When in-house staffing is insufficient or not appropriately aligned with the task, outsourcing can produce big savings, said Teri Deabler, a practice management consultant with the Texas Medical Association.
For example, she said that a client was paying an in-house accountant $80,000 a year. When the accountant retired, she was replaced with a part-time bookkeeper earning $20,000 while her accounting work was outsourced at a cost of $20,000 a year. “The practice’s costs for this service were cut in half,” Ms. Deabler said.
What functions lend themselves to outsourcing?
Clinical services are rarely outsourced by individual practices – although hospitals now outsource numerous clinical services – but virtually any kind of administrative service can be contracted out. Outsourcing used to be limited mainly to billing and off-hours phone services, but today, more services are available, such as scribing, processing prior authorizations, accounting and bookkeeping, human resources (HR) and payroll, interactions with social media, recredentialing, medical transcription, and marketing.
Meanwhile, the original outsourced services have evolved. Billing and collections may now be handled by off-shore VAs, and phone services now deal with a wider variety of tasks, such as answering patients’ questions, scheduling appointments, and making referrals.
Ron Holder, chief operating officer of Medical Group Management Association in Englewood, Colo., said that some outsourcing services can also adjust the amount of work provided based on the customer’s needs. “For instance, an IT outsourcer may allow you to scale up IT support for a new big tech project, such as installing a new electronic health record,” he said.
The outsourced service provider, who might work in another state or another country, is connected to the practice by phone and electronically, and represents the practice when dealing with patients, insurers, or other vendors.
“No one, including patients and your physicians, should know that they are dealing with an outsourced company,” said Mr. Holder. “The work, look, and feel of the outsourced functions should be seamless. Employees at the outsourcer should always identify themselves as the practice, not the outsourcing service.”
Dr. Hochman said that many outsourcing companies dedicate a particular worker to a particular practice and train them to work there. One example of this approach is Provider’s Choice Scribe Services, based in San Antonio. On its website, the company notes that each scribe is paired with a doctor and learns his or her documentation preferences, EMR use, and charting requirements.
What medical practices benefit most from outsourcing?
All kinds and sizes of practices contract with outsourcing firms, but the arrangement is particularly useful for smaller practices, Mr. Holder said. “Larger practices have the economies of scale that allow services to be in-house,” he said, “but smaller practices don’t have that opportunity.”
Dr. Hochman added that outsourcing firms can be hired part-time when the practice doesn’t have enough work for a full-time position. Alternatively, a full-time outsourcing firm can perform two or more separate tasks, such as scribing while handling prior authorizations, she said.
Outsourcing is also useful for new practices, Ms. Deabler said. “A new practice is not earning much money, so it has to have a bare-bones staff,” she said. “Billing, for example, should be contracted out, but it won’t cost that much, because the outsourcer typically charges by volume, and the volume in a new practice is low.”
Meanwhile, Mr. Holder said that the outsourcing of prior authorization work can particularly benefit specialty practices because they typically have a lot of prior authorizations to deal with.
The pros and cons of outsourcing
Experts with experience in outsourcing agree there are both pluses and minuses. “Practices with outsourced workers have less overhead, don’t have to deal with staff turnover, and costs may be lower than for in-house staff,” Ms. Deabler said. “However, you have limited control over outsourced workers and the practice may seem more anonymous to patients, so you need to consider this option very carefully.”
“With outsourcing, you lose control,” said John Machata, MD, a recently retired solo family physician in Wickford, R.I. “You’re trusting someone else to do work that you could do anyway.”
When he briefly considered outsourcing the practice’s billing many years ago, he found that billing companies wouldn’t handle bills that took a lot of work, such as getting in touch with the insurance company and explaining the patient’s situation. “They would only handle the easy bills, which the practice could do anyway,” he said.
However, he does think that answering services may be useful to outsource. “Patients are more inclined to call an anonymous entity than the doctor,” he said. When he gave patients his cell phone number, he said that some patients held off from calling because they didn’t want to bother him.
“Outsourced staff should be less expensive than in-house staff,” said Daniel Shay, an attorney at Gosfield & Associates in Philadelphia. “On the other hand, you are liable for the outsourcer’s mistakes. If your outsourced billing company is upcoding claims, your practice would be on the hook for repayment and penalties.”
Mr. Holder said: “An outsourcer ought to be more efficient at its chosen task because that is what they know how to do. This is a plus at a small practice, where the practice manager may need to do the billing, HR, IT, marketing, some legal work, and accounting,” he said. “No one person can do all of those things well.”
He added, however, “If you choose outsourcing and then decide you don’t like it, it’s difficult to unwind the arrangement. Staff that have been dismissed can’t easily be hired back, so it shouldn’t be an easy decision to make.”
Also, sometimes the staff at offshore outsourcing firms may have accents that are harder for patients to understand, and the offshore staff may not readily understand a U.S. caller. However, Dr. Hochman said that practices often have a chance to interview and select specific persons on the offshore team who best fit their needs.
Offshore outsourcing
Outsourcing firms have been moving abroad, where costs are lower. Typical venues are India and the Philippines because there are larger percentages of people who speak English. Since 2020, demand at offshore medical billing companies has been growing faster than their domestic counterparts, according to a recent analysis.
The difference in price can be substantial. In 2020, the average salary for scribes in India was $500 a month, compared with $2,500 for scribes in the United States.
However, offshore outsourcing is starting to face limitations in some places because of privacy issues, according to David J. Zetter, a practice management consultant in Mechanicsburg, Pa. He pointed to a new Florida law that limits use of offshore vendors because they deal with confidential patient information. The law, which became effective July 1, requires that any protected health information must be maintained in the United States or Canada.
“This will make it very hard for many types of offshore vendors to operate in Florida,” he said. He noted that Florida is the only state with such a restriction, but similar proposals are under consideration in a few other states, such as Texas.
How to select the right company
Mr. Zetter said that the biggest mistake practices make when choosing a company is failing to take enough time to examine their choice. “Quite often, practices don’t validate that companies know what they are doing,” he said. “They get a recommendation and go with it.”
“Choose a company with experience in your specialty,” Mr. Zetter advised. “Speak with the company’s clients, not just the ones the company gives you to speak to. You should ask for the full list of clients and speak to all of them.”
Ms. Deabler said that it’s fairly easy to find respected outsourcing companies. “Colleagues can make recommendations, state and specialty societies can provide lists of preferred vendors, and you can visit vendors’ booths at medical conferences,” she said. She added that it’s also easy to find evaluations of each company. “You can Google the company and come up with all kinds of information about it,” she said.
Mr. Shay said that practices should make sure they understand the terms of the contract with a VA. “Depending on how the contract is worded, you may be stuck with the relationship for many years,” he said. “Before you sign an outsourcing contract, you need to make sure it has a reasonable termination provision.”
Because vetting companies properly can require extensive work, Ms. Deabler said, the work can be given to an experienced practice management consultant. “The consultant can start with a cost-benefit analysis that will show you whether outsourcing would be worthwhile,” she said.
Working with outsource service providers
Mr. Holder said that doctors should keep track of what the outsourcer is doing rather than simply let them do their work. “For example, doctors should understand the billing codes they use most often, such as the five levels of evaluation and management codes, and not just blindly rely on the billing company to code and bill their work correctly,” he noted.
Ms. Deabler said that companies provide monthly reports on their work. “Doctors should be reading these reports and contacting the company if expectations aren’t met,” she said.
Even in the reports, companies can hide problems from untrained eyes, Mr. Holder said. “For example, anyone can meet a metric like days in accounts receivable simply by writing off any charge that isn’t paid after 90 days.”
“You need to be engaged with the outsourcer,” he said. “It’s also a good idea to bring in a consultant to periodically check an outsourcer’s work.”
Will outsourcing expand in the future?
Mr. Holder said that the increasing use of value-based care may require practices to rely more on outsourcing in the future. “For instance, if a practice has a value-based contract that requires providing behavioral health services to patients, it might make sense to outsource that work rather than hire psychologists in-house,” he said.
Practices rarely outsource clinical services, but Mr. Holder said that this may happen in the future: “Now that Medicare is paying less for telehealth, practices have to find a way to provide it without using expensive examining room space,” he said. “Some practices may decide to outsource telehealth instead.”
Mr. Shay said that there are many reasons why outsourcing has a strong future. “It allows you to concentrate on your clinical care, and it is a solution to problems with turnover of in-house staff,” he said. “It can also be more efficient because the service is presumably an expert in areas like billing and collections, which means it may be able to ensure more efficient and faster reimbursements. And if the work is outsourced overseas, you can save money through lower worker salaries.”
A version of this article first appeared on Medscape.com.