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  • Writer's pictureMuhammad Sair Khan

Why Hire Third Party Medical Billing

Every behavioral health facility depends on quick and accurate payment from insurance companies. Any error could cause a delay in payment of up to 30 days, and sometimes months. What some facility owners fail to realize is that the revenue cycle starts well before a claim is submitted to the insurance company. It begins before the patient begins treatment and does not end until the last dollar is collected.

If you are looking for efficient, maximum reimbursement, you need a knowledgeable behavioral health billing partner who can manage every aspect of the revenue cycle including: verification of benefits, authorization, claim submission, insurance follow-up, appeals, and practice analysis.

Benefit Verification

Proper and timely benefit verification is the critical first step of the revenue cycle for your behavioral health facility . It is the nuts and bolts too quick, accurate claim submission and processing. Without proper information, your claim is at risk of denial before it is ever submitted.

The right third party medical billing company will know the right questions to ask. They will identify policy-specific exclusions or limitations, and clearly outline what you can expect to receive from the insurance company and what you should collect from your client. If a specific billing code is not covered, the right billing company will notate that in that patient’s account and bill accordingly.

Insurance companies constantly change their clinical and billing guidelines. Datapro is the right medical billing company for your behavioral health facility because we stay up to date on industry-wide policies and procedures. Because third-party medical billing companies work with multiple facilities, we have a wider reach and can more quickly identify trends in claim denials and other payment patterns that need to be addressed. By getting ahead of the problem, your behavioral health facility will avoid fluctuations in reimbursement.

Claim Denials

Claim denials are one of the largest barriers to effective revenue cycle management. According to Change Healthcare, approximately 5% of claims get denied upon submission, even though the claim is accurate.

When you hire the right medical billing partner, you are hiring a team that follows up on every denial within days. An experienced biller, we will know at first glance what went wrong and how to fix it. Our team will know how to quickly and efficiently get the claim back to the insurance company for reprocessing. In a circumstance where your claim requires an insurance appeal, your behavioral health billing company will have a plan.

Change in Healthcare estimates make up approximately 65 percent of denied insurance claims that are never collected on. This is huge collection potential or revenue loss. As a medical provider, your behavioral health facility has the right to appeal any claim decision, both with the payer, and with the state. Both are subject to timely filing limitations making it critical to act on claim denials from the day that the denial is received.

A strong appeal letter takes time to write. You need to gather historical data on the claim and have knowledge about specific state and payer guidelines to support your appeal. Once you submit the appeal and supporting documentation, the processing time takes approximately 45 days, during which follow-up is critical. The right behavioral health billing company will ensure this process is as efficient and streamlined as possible.


A behavioral health billing company should provide reports that help you measure your financial progress throughout the year. It’s important to understand where you stand and what changes could be made to improve revenue. Some common key performance indicators (KPI) are:

  • Days in accounts receivable (A/R)

  • Average time to pay

  • Average time to pay by payer

  • Collections per visit

  • Reimbursement rates by payer

Low Pay Appeals

Understanding the payment process is crucial in making sure that claims get paid correctly. If you are in-network, are each of your claims getting paid at the in-network rate? If you know that your patient’s deductible was met prior to being seen at your behavioral health facility (VOB) but the patient’s insurance company does not pay the claim and instead charges it to the patient’s deductible – who on your team is identifying that? Are they sending the claim to be reprocessed and paid correctly? Or, what if your patient’s insurance policy should pay 80% of the contracted rate (per the VOB) but they only pay 60%? Who addresses that? These seemingly small inaccuracies can make a huge difference to your bottom line.

Out-of-network providers face their own set of challenges when it comes to underpaid claims. Most insurance companies outsource claim pricing to third party vendors who pay a fraction of usual and customary rates. If you call or appeal to have the claim repriced, the payer will usually respond with, “the claim was priced by a third party and there isn’t anything we can do.” Sure, that may be the case, however, there is another option. Many third-party pricing companies accept low-pay appeals and with the right appeal letter, will issue additional payment.

When new clients come to Datapro, they usually have a concern that their revenue doesn’t match the amount of business they are doing. As indicated above, there are many reasons why this could be the case. Medical billing for behavioral health facilities is complex and is made up of different processes, all which take time and industry knowledge. Using a third-party billing company can provide added assurance that the proper leg work is being done ahead of time to ensure a smooth billing cycle.

Optimizing the revenue cycle with the right medical billing company will save you and your staff time and help generate more money for your behavioral health facility. Whether you are looking to sharpen your benefit verification process, need assistance collecting old receivables, or are trying to gain greater insight into your facility’s KPI’s, partnering with a third-party billing company could be the right option for you.

To see how Datapro can help your collection process request an audit today.

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