‘We need to fire the billing office.’ Really?

October 19, 2010

When times get tight, we start to hear complaints about overhead costs and nonphysician staff costs. That’s natural. But don’t let folks jump to conclusions. Just because you don’t know or understand a process doesn’t mean it’s superfluous. When I hear our radiologists mumble “what do all those people do?” I tell them it is time for them to find out. But don’t stick all the work on one person. Use the perceived “crisis” or gripe-fest to educate the staff on processes in the back office.

When times get tight, we start to hear complaints about overhead costs and nonphysician staff costs. That’s natural. But don’t let folks jump to conclusions. Just because you don’t know or understand a process doesn’t mean it’s superfluous. When I hear our radiologists mumble “what do all those people do?” I tell them it is time for them to find out. But don’t stick all the work on one person. Use the perceived “crisis” or gripe-fest to educate the staff on processes in the back office.

It is wise to subject all of your office practices to regular scrutiny and analysis. It is not wrong or insulting to undertake a comprehensive review of the billing office, or to suggest getting a proposal from an outsourcing company, for example, if you have an in-house billing operation. Just understand the ramifications-good and bad-of doing so.

Hold people’s feet to the fire

If someone is complaining, ask him or her to lead the charge. You can have an individual develop questions or form a working group to determine questions for the business office. Leaders should keep the process moving, set deadlines, and emphasize to the administrative staff that they must respond effectively to physician queries. The physicians, especially those voicing complaints, should participate. Have them start a process of analysis, working with your billing or office manager. For example, physicians might want to ask the billing office for a detailed list of billing costs.

Use the opportunity well

Even if you do not end up with wholesale changes, you may recognize benefits. An analysis of billing expenses may reveal possible cost savings. Refinancing debt is a good example. Rebidding contracts for things like overnight call coverage, transcription, and phone service are also possible places to look for improvement.

Be methodical

Encourage the physicians to look at things in manageable bites, but work your way through the whole operation. Don’t be haphazard. If you don’t have time for a comprehensive office review, you may need to consider an outside consultant. Understand that consultants are generally viewed with fear and loathing and may engender some ill will. On the other hand, consultants can serve as scapegoats if there are problems.

Use metrics (but be careful about trusting them)

When you assess the quality of your operations, use standards from the radiology industry. Take care to look at radiology-specific trends and benchmarks, especially in the billing process, as those in radiology are fundamentally different from other specialties. For example, radiology typically drops more charges and manages more denials.

The Radiology Business Managers Association (RBMA) is a good place to obtain radiology-specific data for billing and business costs. Remember, too, that if you have your own teleradiology practice, you also have unique radiology costs. This may mean you have extra overhead to assess.

Don’t be afraid to use proposals from a variety of vendors for anything you subcontract, such as information technology services, as these are benchmarks for you as well. Remember that numbers can look good or bad comparatively, depending on what is included. Make sure you include all of the appropriate costs for one part of the business in your analysis.


Dr. Woodcock is medical director for MRI at St. Joseph’s Hospital in Atlanta. He is also a member of the executive board of Atlanta Radiology Consultants and is the practice’s executive officer for finance. He may be reached at rjwatlrad@gmail.com.