How to Start a Medical Billing Practice
Busy medical professionals who need to gather billing information from insurance agencies as well as payment information from individuals, rely on medical billing services. The U.S. Census Bureau reported that in 1997, 28,000 billing companies brought in more than $6.2 billion, according to the American Medical Billing Association.
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Instructions
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Establish Your Skills
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Obtain the specialized skills to start your business. While the industry is extremely lucrative--competition is fierce. You will need specialized training to be able to provide the services medical professionals need. AMBA offers an online program for $559 (as of 2010). You can also take medical billing courses at a local medical college. If you lack funds, consider applying for employment at local medical offices to obtain the specialized skills you need.
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Apply for proper licensing. Businesses operating out of state and local jurisdictions require licensing. Jurisdictions vary widely in the licensing needed for specific types of businesses. Business.gov has a clearinghouse that provides general information for each state.
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Cost out your supplies to determine your prices and start-up costs. Local medical billing suppliers can provide information on the cost of supplies you'll need. Medical billing software offered by AMBA runs from $199 to $995 for their professional program. You'll also need prices for your office space--should you decide to lease office space--office supplies, and office furniture. Cost out your labor. Even though you may be your only employee--charge for your services. Cost out the average time it takes you to do your billing. Most service businesses need a mark-up of at least three to four times the cost of running the business. Since your services are specialized you'll be able to charge premium prices.
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Write a winning business plan for your medical billing service. Now that you've gathered pricing information, you're prepared to write a detailed medical billing business plan. Include all of your costs, determine your pricing information, and map out your marketing plan. Include a listing a medical professionals in your area. List the name of the business, telephone number, and name of the office manager. You'll need the information when you begin building your clientele.
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Run your business professionally--from the outset. Even if you only house your billing office in a corner of your bedroom--devote that space to your business. Don't phone clients with children talking in the background, or the television blaring. Medical professionals are seeking billing services from professional businesses. Sento, a large answering service in Albuquerque, New Mexico, had a large eye glass and contact lens firm as their largest customer. Because they failed to properly train their phone reps, they lost that contract in 2008 due to customers complaining to the medical company about the background noise of reps who weren't on the call cursing and talking disrespectful to one another. After laying off more than half of its staff, Sento in New Mexico is still struggling to recover from losing the contract.
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References
- Photo Credit large bills image by Bruce Shippee from Fotolia.com
