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Outsource vs In-House:  Expenses

Similar employee expense, dramatically different result

Actual costs of outsourcing to a reputable medical billing company is very comparable to the employment costs associated with having an in-house biller.  The difference: realizing maximum revenue potential and immediate savings through technology solutions provided.  For illustration, we have put together an approximate expense comparison - see below.
**Approximate calculations based on $500,000 annual gross revenue, 200 statements per month

Summary: In-House Billing

Description:

- 1 FTE @ $17.00/hr
(salary, benefits, and taxes)
- Vacation / Sick Pay
(2 wks vacation / 5 days sick pay)
-Training & Reference Materials
(seminars, training materials, coding books & subscriptions)
- Software / Hardware Expenses
(billing software, PC support, upgrades, maintenance, etc.)
- Office Supplies for Billing
(insurance forms, paper, toner, etc.)
- Patient Statement Expenses
(postage, paper, envelopes, toner, etc.)
- Clearinghouse Fees
Expense:

-$45,000.00

-$1,700.00

-$2,000.00


-$4,000.00
(minimum)

-$400.00

-$1,800.00

-$1,500.00
APPROXIMATE ANNUAL EXPENSE:
RETURN ON INVESTMENT (ROI):
(An in-house staff in a busy medical office is subjected to many distractions, causing lost productivity and ultimately lost revenue)
-$56,400.00
.00
APPROXIMATE ANNUAL TOTAL:
-$56,400.00

Summary: Outsourced with MPS

Description:

- Billing Fee @ 7.5% (example)
(rate/fee determined case-by-case)
- Vacation / Sick Pay
(2 wks vacation / 5 days sick pay)
-Training & Reference Materials
(seminars, training materials, coding books & subscriptions)
- Software / Hardware Expenses
(billing software, PC support, upgrades, maintenance, etc.)
- Office Supplies for Billing
(insurance forms, paper, toner, etc.)
- Patient Statement Expenses
(at cost)
- Clearinghouse Fees
Expense:

-$37,500.00

N/A

N/A


N/A


N/A

-$1,080.00

N/A
APPROXIMATE ANNUAL EXPENSE:
RETURN ON INVESTMENT (ROI):
(ROI based on proven 5-25% increase in revenue by direct result of better billing and collections performance)
-$38,580.00
+$25,000.00
(at 5% better performance)
APPROXIMATE ANNUAL TOTAL:
-$13,580.00