How to Start a Medical Billing and Coding Business from Home in 18 Steps - ProfitableVenture (2023)

Do you want to start a medical billing and coding business from home? If YES, here is a complete guide to starting a doctor billing business with NO money and no experience plus oneFinallyMedical billing business planPresentation.If you are looking for an opportunity to work in hospitals but not as a healthcare provider, then starting a medical billing business might be the best for you.

Starting a medical billing business means helping hospitals and doctor's offices process claims from insurance companies and then trying to recoup the balance by getting patients to pay what they owe. Since this is a paper-heavy job, it's important that you have the experience needed to handle insurance claims and patient billing effectively.

Once you have the experience needed to start this business, you will also need to get the necessary certification before you can legally open and operate your medical billing business in the United States of America. You can get this certification by attending a traditional school or online.

Whichever method you choose, it's fine as long as you make sure the schools, especially online schools, are well accredited. GoalGet the certification you need before launching your medical billing businessis to boost your business and enable you to stand out from other competitors.

As with any other business, you should do a thorough market research before starting this business. Market research allows you to gather the necessary facts that will help you understand the industry you want to be involved in.

18 steps to start a medical billing and coding business from home

1. Understand the industry

According to IBISWorld, the medical billing industry is worth $3 billion annually, growing at 8.8 percent over a five-year period (2011 to 2016). There are more than 2,300 medical billing companies in the United States, employing more than 7,000 people.

The industry is so highly regarded due to the increasing demand for medical billing services, which has resulted in more operators entering the industry. The demand in this industry increased mainly due to the increasing number of baby boomers requiring medical billing services, especially in 2016 due to the increase in doctor visits.

The industry is expected to grow steadily over the next five years (2016 to 2022), especially as more seniors apply for Medicare. Also during this period, an increase in the number of insured is expected as part of the health care reform, which will allow people with previous illnesses to be covered. This growing demand, especially from the elderly, will not only help the industry to meet a huge need from operators, but will also boost the industry's revenues.

However, it should be noted that despite the high demand in this industry, the concentration of market shares is still quite low, especially since only one operator generates more than 14 percent of the total revenue of the industry, while the other operators in the industry each less than more than 5 percent of the turnover for the branch.

Most operators in this industry operate on a large scale and therefore offer a wide range of services such as claims handling, risk management and consultancy. According to IBISWorld, the industry's largest player has driven market share concentration with its spate of acquisitions and growth rates that have outpaced industry growth.

According to a 2015 study by Grand View Research, Inc. the medical billing outsourcing market was worth more than $6 billion and is expected to reach $17 billion by 2024. In the medical practice, there were multiple challenges due to internal billing processes, mainly untrained staff, lack of appropriate financial policies, inappropriate IT structure and billing errors.

The challenge is that most hospitals and medical practices prefer to outsource their medical billing processes. 95 percent of most independent physicians said they prefer to outsource their medical billing processes in-house.

Globally, North America has the highest revenue growth in this industry. In the United States, rapid changes were taking place in the structure of the health care system, and rising health care costs were a major driver in the North American region. In the industry, consolidation is one of the major factors behind the growth of the market.

Hospitals are among the largest customers of medical billing companies and generate the most revenue, especially as rising healthcare costs have depressed hospital profits and led them to turn to medical billing companies to help manage their revenues.

According to Grand View Research, Inc. the medical billing market is divided into internal and external billing. In 2014, total supplier costs for internal operations were $252 billion. These costs include ongoing costs such as IT costs and the costs of maintaining an internal billing team and an administrative team.

This compared to outsourcing, which has resulted in significant cost savings for hospitals and lower error rates. In addition, outsourcing meant doctors could now focus on their core business: providing patients with the best possible care, without having to worry about managing bills and collecting claims.

Although hospitals had the largest market share in 2015, the positive trend was halted by the increasing demand to outsource medical billing services from doctors' offices and private clinics. However, hospitals are still expected to generate the highest revenue in this industry due to the higher number of claims compared to independent doctors and private clinics. Globally, the medical billing outsourcing market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East, Africa with North America generating the highest market revenue.

2. Conduct market research and feasibility studies

• Demography and Psychology

The demographic and psychographic composition of those requiring the services of a medical billing company is not limited to large hospitals, but also includes independent physicians, medium and small hospitals, and private clinics. This is because medical billing companies not only help their customers reduce costs, but also manage their operating margins more efficiently.

So if you want to limit the demographics of your medical billing business to just hospitals, you're severely limiting the scope of your business. Therefore, you should strive to be more complete in your demographics.

3. Determine which niche you want to target

Since medical billing is a business that helps hospitals and independent doctors process and investigate claims to help them recover unpaid amounts from their patients, it can be a very stressful job, especially if you are just starting out and are not sure in what niche are you aiming for yet. in; That is why it is important to conduct industry-oriented market research to determine in which niche you can best offer your services, especially with the increasing acceptance of outsourcing by hospitals and independent doctors.

Below are some niche areas that you can focus on when starting your own medical billing business.

• Investigation of policies and claims
• claims processing
• damage assessment
• Regional office, administrative support and advice

The level of competition in the industry

The level of competition in the medical billing industry largely depends on the location of the company. Therefore, in order to compete effectively in the market, large operators usually try to establish themselves in several locations.

Due to the sensitivity of the data processed by medical billing companies, physical contact must be established to provide proper instructions. In addition, most hospitals still have not fully digitized all their records and information, which means that a medical billing service provider would have to go to their customers and physically retrieve the data they need. However, what most clients expect when outsourcing their medical billing system is that there will be fewer errors in their billing system, client information will be secure, and they will be able to save a lot more in the long run.

Due to the increasing adoption of medical billing services, the number of new entrants in the market is increasing, which has led to fierce competition among operators. The market concentration of this industry is very low because there are very few well-known brands, but this does not affect the local competition in any way. This means that if you intend to enter this business in the United States of America, you must be prepared to deal with competition.

4. Know your main competitors in the industry

According to a report by IBISWorld, the medical billing market has very low market concentration, with one large company accounting for about 15 percent of the industry's total revenue. While this may be the case, it doesn't mean there aren't other well-known or popular brands in the industry, even though they may not be as popular as the top company. There are several factors that make a company famous, namely: quality of service, success rate and relationship between clients and clients.

Therefore, below are some of the leading medical billing companies in the United States of America.

• HMS Funds
• McKesson Corporation
• Experian Informatieoplossingen, Inc
• Accretive Health, Inc.
• GE Healthcare
• SSI group
• Conscious technological solutions
• HCL technologies

Economic analysis

More and more major healthcare providers are requiring medical billing companies to manage their billing processes. This is because these large healthcare providers understand the economic benefits of having their billing processes managed by medical billing companies, as they can process more transactions while maximizing their margins. This has led to a growing global understanding of the benefits of medical billing processes as standard care providers in regions such as Asia Pacific and Latin America have begun to integrate them as well.

The federal government plays a role in why most healthcare providers use medical billing companies. This is because the state provides most of the funding for ithealthcare industrydemanding that health systems become more efficient so that they can fully utilize the financial allocations. Developed countries are increasing health care expenditures, mainly because a significant portion of their populations are considered elderly, and also because of the increasing prevalence of chronic diseases.

Even as the medical billing market grows, there is a greater need for medical billing companies to be more transparent and help their clients achieve specific goals such as maximizing return on investment, balancing expenses and income, and helping to reduce liquidity conversion cycles.

However, all these growing responsibilities will lead to single-digit growth in the medical billing market between 2016 and 2022, especially as challenges such as changing regulations can be a growing concern for operators in this industry.

Part of what helped make the medical billing industry where it is today is the belief of healthcare companies, especially small and medium-sized businesses, that outsourcing their billing processes will not only help reduce operational costs, but also efficiency will increase.

Another reason is the fact that healthcare organizations have not shown the necessary enthusiasm to set up an internal billing department and extensively train the staff working there, leading hospitals to entrust internal information to these third parties.

5. Decide if you want to buy a franchise or start from scratch

Buying a franchise usually means that you agree to make most of the decisions, such as operations, marketing and promotions, that we can arrange for you. Any business that sells a franchise usually has benefits for the entrepreneur to take advantage of; However, rather than being guided by the benefits, consider why acquiring that franchise is best for your business so that you don't waste your resources on a franchise that will not benefit you in the long run.

Starting a business from scratch is one way to learn the basics of running a business as you need to be involved in all major aspects of the business. However, starting from scratch will allow you as an entrepreneur to maintain control of your business and make changes that you feel are in the best interest of your physician business.

6. Know the potential threats and challenges you will face

Any entrepreneur starting a business should understand and recognize that the business is likely to face certain threats and challenges, and then devise plans to deal with those threats and challenges as they arise so that they do not negatively impact Company.

Therefore, some of the threats and challenges you are likely to face when starting your own medical billing business are: changing government regulations, increased competition from already existing competitors, new entrants offering the same services and starting in the same location, and economic downturn .

As mentioned earlier, as an entrepreneur you cannot do anything about threats and challenges because they are always there. The best thing you can do is make plans and be proactive.

7. Choose the most suitable legal entity (LLC, C Corp, S Corp)

Choosing the best legal entity for your medical billing business is very important because the legal entity you choose for your business will determine how far your business will go. In addition, the choice of a legal entity for your company determines how your company is taxed, how easy it is to set up a legal entity and how much personal debt you have.

In the United States, there are five legal entities that you can choose from when starting your medical billing business: sole proprietorship, partnership, corporation, S corporation,A limited liability company(LLC) or Limited Liability Partnership (LLP). Working with an attorney or accountant can help you determine which legal entity is best for your medical billing business.

The corporate form of a legal entity is very complicated and difficult to determine and therefore usually requires the help of a lawyer. In a corporation, the company is considered as a legal entity separate from the owner. This is especially useful as it protects owners from any liability for their private property.

A company can be divided into an S company and a C company. Entrepreneurs usually prefer an S corporation because the owners enjoy liability protection and also enjoy tax advantages and thus are not double taxed like a C corporation.

OfA limited liability companyThe legal form (doo) is the most preferred by entrepreneurs, probably due to the fact that it offers a number of advantages and yet is not as heavy in terms of regulation and control. An LLC has the tax benefits of a partnership and protects the owners from corporate liability, but there are no restrictions on shareholders and the owners can participate in the business of the business.

8. Pick a catchy business name

Choosing the right name for your medical billing business is very important, especially since the name you choose for your business will determine how your business will be perceived by your target audience. That is why it is important that you choose a name that is not only unique and memorable, but also gives a hint of the industry you are in.

So if you are thinking about starting your own medical billing business and are wondering which names to consider, here are a few.

• Joe Cole Medical Billings Inc
• Prime Center Healthcare Solutions
• Future billing of quantity
• Andrew Yates Healthcare Inc
• Cast Ice Medical records and more
• Clinton medical solutions

9. Talk to a broker about the best insurance policies for you

If you plan to do business in the United States, you must have an insurance policy. Having the right insurance policies will protect you personally from any legal issues or injuries that may arise while running your business.

Therefore, before you start medical billing, it is important that you understand what insurance policies you need for your business so that you can plan for the right budget. It is important that you use the services of an insurance agent or broker to determine what is best for your medical billing company.

So, here are some basic insurance policies that you should consider purchasing if you want to start your own medical billing business in the United States of America.

• General liability insurance
• contents insurance
• Guidelines for entrepreneurs
• Error and omission insurance
• Cyber ​​Liability Insurance
• damage compensation insurance
• umbrella insurance

10. Protect your intellectual property with trademarks, copyrights and patents

In any business, the right ideas can sometimes result in valuable assets, and with the volatility of the business environment, it becomes increasingly difficult to protect those ideas without the need to implement intellectual property protection. Intellectual property protection helps protect a company's most valuable assets, such as data, patents, trademarks, designs, domain names, copyrights, and trade secrets.

However, applying for an IPP can be time consuming. Therefore, it is best to hire an attorney with experience in this industry to assist you in filing with the United States Patent and Trademark Office (USPTO).

11. Obtain the necessary professional certification

Handling patient information and insurance claims, as well as helping hospitals and independent physicians manage and process their bills, are very important responsibilities. Therefore, you must have experience and certain certifications in order to not only take customer orders but also differentiate yourself from your competitors in the industry. This industry highly recommends operators to get various certifications as it not only shows their commitment to the company but also helps to raise your profile.

So, below are some certifications that you can work towards if you intend to start and run your own medical billing business.

• Certified Professional Biller (CPB)
• Certified Medical Reimbursement Specialist (CMRS)
• Medical billing and coding certification
• Medical examiner's certificate
• Verification of medical documentation
• Confirmation of medical compliance
• General Practitioner Certification
• Instructor Certification

It is important to note that the more qualifications you acquire, the easier it will be to attract major hospitals for your physician billing business.

12. Get the necessary legal documents you need for your job

Regardless of what business you want to set up in the United States of America, it is important that you have the necessary documentation to avoid getting into trouble with the law. The medical billing is a very serious matter and if you don't have all the documentation you are at risk as you may not only be penalized financially but you may also be banned from running a business anywhere in the world the United States of America .

Therefore, below are some of the basic legal documents you will need before opening your own medical billing company in the United States of America.

• Memorandum of association
• business contract
• Business license, permit and certificate
• business plan
• Employment contract
• contractual documents
• Confidentiality Statements
• Insurance Policy
• Employer Identification Number (EIN)
• Federal tax identification number

13. Get the startup capital you need

Any entrepreneur who wants to start a business should have the necessary resources to run the business until it starts generating revenue and making a mark. This also applies to the billing of medical services. Fundraising is always a challenge for any entrepreneur. Therefore, it is necessary to have a business plan available that will help convince potential investors of your commitment to the business you want to start and convince them of the reasons why it is necessary to invest in your business.

Listed below are some financing options to consider when seeking start-up capital for your medical billing business.

• Use personal savings and partial sales as part of the initial capital
• Find low-interest loans from friends and relatives
• Apply for a loan from the bank
• Approach private investors for loans in exchange for an equity or partnership deal

14. Choose a suitable location for your business

The environment in which you want to do business also plays an important role in choosing a suitable location for your company. For example, if your medical billing needs to be done in a rural area, where there are two major hospitals and a handful of private clinics and independent doctors, and you have little or no competition, making your home business such a bad idea.

If you run your business from home, make sure you arrange your office space so that sensitive documents don't get mixed up or your child or pet messes around in the office space, which could lead to a lawsuit against you. Prepare a cabinet to store all your files, just as you would in a commercial rental or rental home.

However, if you are considering leasing or renting a facility, you should engage a real estate agent who has in-depth knowledge of your type of business to guide you in choosing the one that is best for your medical billing business. price support and proximity to your target market.

The facility you choose should be attractive, within your budget and easily accessible for your employees and customers. If you choose a place that is too far away, you will have to spend more money to promote the place to your target audience.

15. Hire staff for your technical and human needs

Any entrepreneur who plans to start a medical billing business will be able to start the business without much financial stress as it is a non-capital intensive business. Running a business from home is better for you because you don't have to worry about office expenses and almost no inventory. Most of your expenses will be spent on getting the right office equipment and tools.

One of the indispensable tools for making money is medical billing software. You need to be careful when choosing the right software for your business because most medical billing software programs have different features.

If you prefer to build your own custom medical billing software, it may be best to purchase some basic software and hire the services of an IT or systems administrator to customize it to your taste. It's important that you settle for the best because your whole business starts from here.

The type of equipment and tools you need to effectively start and run your medical billing business are: computer system, printer, fax, software, modem, reference materials, telephone (landline and mobile), HCFA 1500 forms, postage, office supplies and accessories .

When setting up the right business structure for your medical billing company, it is imperative that you hire the right people who have the necessary experience and qualifications. Therefore, hire: a chief executive officer (CEO), an administrative and personnel manager, an accountant, a director of business development and marketing, an ICT consultant, a receptionist and a host.

The above analysis shows that you need at least 7 key employees to run your medical billing business efficiently and successfully.

The service process of the company

The medical billing process consists of several steps and is not as complicated as most people think. The steps include: registering patients and ensuring that the patient's financial responsibility is confirmed. This means that the patient's insurance details are checked to see if they cover the costs incurred. If this is not the case, the patient must agree to pay the remaining amount out of his own pocket.

After the patient submits all necessary documents and checks in and out, the medical coder creates a super invoice and sends it through the software to the medical billing company.

The additional bill is then entered in the application by the physician together with the costs of the patient's interventions. However, the patient is not paid the total cost, only the amount originally agreed between the patient and the healthcare provider, which is paid until the total cost is used up. The medical claim created must meet industry standards. It is then sent to the payer (usually an insurance company), who can approve or deny the claim.

After the payer agrees to pay, the medical bill holder creates a bill for the patient showing what portion the payer has agreed to pay. Only then can the patient pay the remaining amount.

16. Write a marketing plan full of ideas and strategies

Marketing is a very important part of any profit-oriented business. Marketing is one of the most important aspects of starting a business and that is why you need to develop the right marketing strategies that will allow you to compete and differentiate yourself from your peers and break into your desired target market.

To develop effective marketing strategies for your business, you need to conduct thorough market research. The information you collect about your target market needs to be accurate so that you don't use the wrong data to hinder your marketing strategies and analysis.

Market research allows you to identify your target market and their distinguishing features, what they expect from you and what you should expect from them. It also allows you to assess how your competitors are doing and how you can beat them and stand out in the industry.

It is very important to have a budget for your marketing campaign because that way you don't have to spend unnecessary resources to make your target audience aware and prefer your services. Below are some platforms you can use to advertise your medical billing business.

• Officially introduce your medical billing business to hospitals, private clinics and independent doctors by sending a letter and attaching a brochure with your services, contact details and prices
• Place advertisements about your doctor's business in newspapers and magazines, as well as on radio and television stations
• Empower your marketing managers to promote your medical billing business to potential customers
• Encourage your loyal customers to recommend you to others
• Distribute flyers and business cards in strategic places
• Use social media platforms like Facebook, Twitter, LinkedIn and Google Plus to advertise and promote your medical billing business

17. Develop solid competitive strategies to help you win

Therefore, some of the competitive strategies that you need to implement for your medical billing company are to provide your customers with quality service, affordable prices, offer additional services, and keep your customers abreast of industry trends.

18. Develop strategies to increase brand awareness and create a corporate identity

Any entrepreneur who has started a business to make money knows the importance of developing strategies that help increase brand awareness and create a corporate identity for the company. The medical billing industry is full of competition, so it's important to have strategies in place to grab the attention of your target audience.

Established companies who know the importance of promoting their business have no problem spending a fortune on it every year. If you are going to start a business that enjoys a national reputation, the best thing to do is to look for ways to promote your business and create a corporate identity for your brand.

There are many advertising consultants whose services you can hire to help you come up with planned advertising strategies for your business in line with your planned goals. Listed below are some of the platforms you can use to promote and create a corporate identity for your medical billing company.

• Make sure your medical billing company is listed in both the Yellow Pages and online directories
• Place billboards in strategic locations to promote your medical billing business
• Distribute flyers and business cards in strategic places
• Create an interactive website and use it to promote your business
• Use social media platforms like Facebook, Linkedin, Google Plus, and Twitter to promote your medical billing business
• Design a distinctive logo for your medical billing company