Sometimes a medical practice will hire billing and coding specialists to work directly for their organization. Most of the time, however, this is work that is outsourced to freelancers and specialists because it is cheaper in the long run to do it this way. This means that knowing how to start a medical billing and coding business is wisdom that could help to make you a lot of extra money over the course of a year.
Medical billing and coding specialists can set their own hours, work part-time, and even telecommute from home. It’s the perfect business for a household that is looking for some supplemental income or the stay-at-home parent that wants to contribute to a household’s finances. It’s also the perfect chance to start a high paying full-time business opportunity.
Are you ready to get started? Then here is what you’re going to need to do.
1. You will need to have formal training in medical billing and coding.
Anyone wishing to start a business like this will need to have an accredited education from a college or university system that provides medical billing and coding classes. The program must have a curriculum that meets the standards of your regional educational board. If you haven’t started a program like this as of yet, the average length of time to complete formal training is 1-2 years. Classes typically cover software programs, medical terminology, public and private health insurance programs, and transcription.
2. You will need to have an effective working environment.
Because medical billing and coding is an administrative business, most zoning codes will allow this type of business to be run out of a home office. If you are telecommuting or working digitally, then you’ve got an even better chance of being able to work from home. You’re going to need to equip your office with computers, fax machines, printers, a dedicate business phone, and plenty of office supplies. Having a comfortable chair that provides 6-8 hours of support is a good thing to have as well.
3. You’ll need to be officially licensed to work.
Even if you are just working as a sole proprietor, you may need to register your business with your local Department of Revenue or similar government organization. You may also need to have a business license, even if you are telecommuting as an independent contractor, because you’ll be receiving work from local clientele.
4. Modern billing and coding requires extensive software.
Depending on how you plan on doing your billing and coding, you may need some extensive software to be installed on your computer. Digital recording software, transcription software, invoicing and bookkeeping products, and even coding reference books are all going to be required to help you achieve a consistent result. If you are doing your own transcribing, having headphones, a microphone, and a foot petal will also be required to complete the job.
5. Begin to market your services.
Medical billing and coding has a very specific customer niche. You’ll need to approach hospitals, clinics, and general practitioner offices to discuss what their billing and coding needs might be. Having demonstrations, pricing charts, or other evidence of the quality of work that you’re able to provide will help you be able to get your foot into the door. You may also want to attend trade shows, get involved with your local Chamber of Commerce, or start networking at medical events so you can begin to engage prospective clients.
6. Meet your deadlines consistently.
Medical billing and coding is precise in numerous ways. Not only must you be 100% accurate in your coding so that the medical bills are accepted by insurance companies, but you must also be able to submit your work within a specific time frame.
Many insurance companies require a claim to be filed within a certain amount of time or they won’t pay for the procedure. Some health procedures must be pre-approved, which means you’ll need to complete your work quickly so that a patient can receive the service that they require.
7. Consider taking a 50/50 approach to your contracts.
Many arrangements in the medical billing and coding field are setup to pay a business after the work has been submitted. Instead of doing work on credit, try to create arrangements where a company pays half down now and then half upon delivery of the assignments that are sent your way.
Some organizations may prefer a “pay as they go” method where money is sent to you at the same time work is sent to you. As long as you don’t have to spend extra time chasing down delinquent accounts, any setup besides payment upon delivery will help your business out. Consider contracting with a collection agency to go after accounts that don’t pay what they owe.
8. Set up estimated taxes.
If you are the sole income earner in your family, then you may need to pay what are called “estimated taxes” each quarter. It’s kind of like the tax withholding that employees find on their paycheck, but you’re paying the money directly to the government. If you expect to pay more than $1,000 in tax payments each year from income earned, then you’ll need to take this step to avoid paying tax penalties later on.
9. Keep your certifications and licenses up-to-date.
Your business licenses will typically need to be renewed every 1-2 years. You may also need to have continuing education credits every so often to keep your certification for medical billing and coding to remain valid. Make sure that you are proactive about keeping everything updated so that you won’t have to stop doing business because they expired or become invalid on you.
Once you have received the training you need to be successful, knowing how to start a medical billing and coding business is a relatively simple process. Follow these steps today to get your new business started.