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EDITORIAL

Why hospital laboratory outreach programs should take control of their billing
According to market surveys, most hospital outreach Three billing service options
programs have chosen to retain their revenue cycle within Let’s look at the three billing service options available today for
the hospital finance department and not implement a your outreach.
separate AR billing system or outsource to a reputable
billing company. Hospital billing department
Using the hospital’s billing department may prove to be
Statistically, hospital laboratory outreach surveys indicate that challenging—and costly. If this is how your organization is
approximately 13 percent outsource their billing to a third party, handling laboratory outreach billing, you’re no doubt aware that
14 percent perform their own billing and collections, and 74 all too often, laboratory outreach billing is commingled with the
percent are using the services of their hospitals’ billing inpatient/outpatient billing. Hospital billing departments typically
departments (see Figure 1). concentrate on collecting the lower volume, high-dollar-amount
inpatient/outpatient balances, which give them the highest return
Ironically, the average revenue per laboratory outreach test has on their investment.
declined since 2011 while the average hospital laboratory
outreach program has grown from $10.6 million in the early 2000s Because of the overhead costs associated with billing and
to $24.9 million in 2016, according to Chi Solutions. collecting the hospital laboratory’s high volume, lower-dollar lab
charges, hospitals frequently choose to write off these smaller
One of the most crucial aspects of outreach is getting paid for balances—which amount to a substantial amount of revenue—
your services. This requires exploring your options and choosing and leave these valuable dollars on the table.
the best setup for your business—ideally, one that will yield the
greatest results. Laboratory department
If your organization chooses to handle laboratory outreach billing
through the laboratory department, most LIS vendors can
implement a billing system that’s adaptable to outreach billing.
Vendors will provide training to designated staff members on the
functionality of the system.
There are disadvantages to operating an AR system.
The laboratory can face staffing issues and additional overall
expense. More important, keeping up with regulatory changes
and rules can be a daunting challenge that must be considered.
If your staff can devote the time and effort needed to understand
the complexity of billing, then these staff members will eventually
be able to correct billing errors in a timely manner for quicker
claim submissions.
Outsource billing
If you decide to place your financial trust in hands of a third-party
vendor, you’ll be relying on a company that has experience and
expertise in the field of laboratory billing revenue and the option
of additional technology. Do your research to ensure that you
choose the best vendor for your organization’s needs. Look for
one who specializes in handling a variety of different business
models and will align your business goal for expanded growth.
Make sure the billing company you choose can evaluate your
business and will examine all outstanding sources in every stage
Figure 1 of the revenue cycle. The third-party billing company can solely
concentrate on your low-dollar / high-volume claims, thus adding
cash to the hospital bottom-line profits.
Many outsource billing vendors can even package an outreach program for you. They’ll not only provide you the AR system,
but will also include often-needed features such as EMR connectivity, lab portal, courier and inventory tracking, and more.
They’ll waive their typical upfront cost for a nominal percent of the net collected.
Choosing to take control of your outreach billing and assessing the avenues that best fit your environment should be your top
priority. After all, getting paid is what will make your outreach program a success.