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Navigating Short-Term Engagements with Outsource Medical Billing Companies

As healthcare providers seek to improve their revenue cycle management processes, many turn to outsource medical billing companies for assistance.

While outsourcing can provide numerous benefits, it's crucial for customers to understand the impracticality of short-term A/R follow-up engagements, when the goal is catching up overdue outstanding accounts receivable.

In this article, we will explore why short-term engagements with outsourced medical billing companies are not an advisable choice for practice managers.

Poor Documentation of Actions Previously Taken Recorded in Billing Software

By the time an RCM outsourced partner is contacted, the unpaid encounters have normally spun out of control due to a lack of resources to keep up with the process.  The current staff has fallen behind and is only concerned with getting the current claims out the door.  Denials may not have been posted on accounts. 

In addition, follow-up actions previously taken might not have been properly noted on the encounter.  In this scenario, the audit trail is broken and makes it nearly impossible for the outsourced partner to succeed in a cost-effective manner for both parties.

Limited Focus on In-depth Analysis

Medical billing is a complex and highly regulated field. When customers engage an outsourced medical billing company, they expect not only efficient billing but also a thorough understanding of their specific needs and challenges. This is especially true for specialist providers with complex practices. Short-term engagements may limit the time available for this comprehensive analysis. Customers could miss out on valuable insights and recommendations that come from a longer-term partnership.

Incomplete Resolution of Issues

Short-term engagements often prioritize immediate goals, such as collecting overdue payments. However, this urgency may result in a surface-level approach that fails to address the root causes of accounts receivable issues such as poor coding or insurance eligibility verification before the visit. Customers risk receiving only partial solutions, leading to recurring problems and potentially requiring further outsourcing in the future. Even if you manage to get caught up on collections, you’re likely to find yourself in the same position again in the future. 

Minimal Time for Process Optimization

Outsourcing should be about more than just addressing urgent concerns; it should offer opportunities for continuous process improvement. Short-term engagements may not provide the necessary time to implement and evaluate process enhancements thoroughly. A more extended partnership allows for a more holistic approach to streamline processes and drive long-term efficiency, including regular chart audits and review of your practice’s financial policy.

Return on Investment Concerns

Outsourcing medical billing is an investment for healthcare providers. Short-term A/R clean-up engagements are typically high-priced and might not allow enough time for the outsourced billing company to demonstrate a significant return on investment. This can leave customers questioning the value of their investment, potentially undermining the trust and partnership's longevity. A great outsource partner will be up-front about the fact that a short-term engagement doesn’t make wise financial sense for either party.

Potential for Administrative Disruption

Transitioning to a new billing company, even temporarily, can introduce operational disruptions and challenges. This is part of the investment your practice makes when working with a new outsource partner. Short-term engagements may not justify the effort and resources required for this transition. Practice managers may find themselves dealing with additional stress and inconveniences without reaping sufficient rewards.


While it may be tempting to engage outsource medical billing companies for short-term solutions aimed at addressing overdue accounts receivable, practice managers must carefully consider the practicality of such arrangements. Potential limitations for the overall success of the project include a weak audit trail, lack of in-depth analysis, not addressing the cause rather than the symptom of the problem, missed opportunities for process optimization, concerns about return on investment, and the possibility of operational disruption.

In many cases, customers may find that establishing a more extended and comprehensive partnership with their outsourced medical billing provider offers much greater benefits. By prioritizing long-term relationships and recognizing the complexities of the healthcare billing landscape, customers can maximize their financial health while minimizing operational disruptions and stress. Choosing a revenue cycle management partner that shares this commitment to long-term success is the key to a prosperous and efficient medical practice.

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