I cannot tell you how many times I have heard practices tell me that the cost of implementing an electronic claiming solution is way too much (or even not needed) because they only process “a handful of claims each week”.
Now I don’t want to sound like all I want to do is sell them a solution, because really our mission statement here at MedNetwork Systems is to assist practices increase profitability, productivity and accountability to allow the main focus of the surgery to remain on the care of its patients and your non consulting hours are for you.
I think that the best way to demonstrate that processing even a few claims each week electronically is much cheaper (and efficient) than being processed manually is through an example.
Manual Cost Calculation
Mary is Dr X’s receptionist.
Mary gets paid $25 per hour (not including all the extra’s like superannuation, workers compensation and overheads).
Mary has 5 Medicare/DVA claims to manually process each week (48 weeks a year because Dr X is closed for 4 weeks each year).
It takes Mary 7 minutes per claim to complete the voucher manually.
The closet post office box is 5 minutes walk.
Each week, it takes Mary 40 minutes to complete the claiming. This equals $16.66 per week OR $799.68 per year.
Once the claims are returned, it takes Mary an additional 15 minutes to reconcile and enter the payment, or an additional $6.25 per week.
This does not include any additional work that may be required for claims that have been rejected.
So in total $1,099.68 is spent just to process a “handful” of claims. This does not include the extra’s for Mary’s hourly rate which is an additional 12 – 15%.
To calculate this example with your own figures, simply follow this formula:
((minutes spent on claiming / 60) x $hourly rate) * number of weeks per year
Electronic Cost Calculation
By using an electronic claiming option like Medicare Online, these figures change significantly.
For someone who can type 50 words per minute, it takes approximately 3 minutes per claim (when entering a new patient).
No need to walk to the post office box.
That is a saving of 25 minutes per week, or $10.42.
As electronic claims are automatically receipted and reconciled, this new process now takes less than 3 minutes.
That is a saving of 12 minutes per week, or $5.00.
That is a total saving of $740.16 per year. This also does not include the time saved for returning patients because they do not need to have their information re-entered.
To calculate this example with your own figures, simply follow this formula:
((minutes spent on claiming / 60) x $hourly rate) * number of weeks per year
Other Benefits
Of course there are other benefits will impact your cashflow that are not even taken into consideration in this example, such as:
- payment within 1 – 2 days rather than 14 days;
- being able to perform patient verification checks against Medicare & DVA to reduce rejections; and
- easy tracking for claims through each stage.
These savings are also purely based on electronic claiming. Usually the implementation of medical practice management software will provide other time and cost savings in a practice.
Perhaps it’s time to take 10 minutes to calculate how much money you are throwing away by processing your claims manually.
Just remember, the purpose of implementing a practice management software solution or any new business procedure into your practice is to ensure that you increase profitability, productivity and accountability whilst ensuring that your main focus is on quality care of your patients and your non consulting hours are for you.
MedNet Group offers a wide range of solutions that include Medicare, DVA & Health Fund electronic claiming options that don’t have to break the bank. With easy pay by the month solutions, total telephone and email support and a commitment to keep your fees up to date – you can start saving time and money today. Call us on 1300 765 110 or sales@mednet.com.au or Contact Us to see which of our solutions is right for you.