One of the primary attractions of a career in the medical insurance billing (MIB) profession is the low startup costs compared to other businesses. Most MIBs plan for big expenditures, but fail to figure in small but essential costs.
In this insightful, two-part article, Nitin Chhoda examines the cost of doing business and what MIBs can expect to spend when they open their own business.
To equip a medical billing business with the basics will require approximately $5,000 and there are numerous ways entrepreneurs can reduce their costs. Keep in mind that prices fluctuate among retail outlets and geographic areas.
It can be tempting to purchase the most expensive medical billing business model available, but a good computer system that includes the hard drive and a minimum of a 19-inch monitor can be obtained for approximately $2,000. A 19-inch monitor will help prevent the eye strain of being in front of the computer for eight hours a day.
The operating system must be the latest version of Windows to be compatible with medical billing software.
A multi-function machine, often called an all-in-one, is capable of printing, scanning, copying and faxing. All of the capabilities will be required as part of the medical billing process. A basic model can be purchased for as little as $100.
Medical Billing Software/EMR
MIBs have a wealth of medical billing software from which to choose. The software represents a major outlay for a fledgling business. MIBs can expect to spend around $700 for medical insurance billing software, though there are systems that cost thousands.
Another option is EMR software that provides all the capabilities required for medical billing, communicating with clearinghouses and maintaining HIPAA compliance when dealing with patient data.
Fully functional EMR systems are available and only require a modest monthly fee. An EMR that has built in security features, is easily updated when needed, can handle the full range of ICD-10 codes, and can be used to create CPT code databases to reflect client specialties.
Medical billing businesses will be required to contract with a clearinghouse, which allows them to submit client claims for reimbursement. The average cost is $300. MIBs should be prepared for the need to purchase additional software for complete clearinghouse compatibility or to offer clients extra services, an expense that can run around $350.
Manuals and reference materials for medical billing business will account for $200-$300. They encompass coding manuals, insurance directories and disease classifications, along with medical terminology and the intricacies of submitting claims.
Available in book form, many are also offered as CD-ROMS that can offer valuable savings. Part of the reference library should include books on marketing the business.
A career in the medical insurance billing field is one of the few professions that require a minimum of investment by entrepreneurs.
Computers, software, reference material and clearinghouse fees represent the major financial outlays, but there are many smaller costs of which MIBs may not be aware. In the second part of the series, Chhoda will explore the smaller, but no less important costs of launching a medical billing service.