How Much Staff Time Does Handling Patient Billing Questions Really Cost Your Dermatology Practice?

In any busy dermatology practice, patient care is paramount. But running a successful practice involves much more than clinical excellence. Behind the scenes, your administrative and billing staff are working tirelessly to keep the financial wheels turning. Among their many tasks, one often overlooked drain on productivity is the time spent answering patient billing questions. These questions are inevitable. Patients want to understand their charges, how their insurance was applied, deductibles, co-pays, and payment options. While addressing patient concerns is crucial for good service, the cumulative time spent researching, explaining, and resolving billing inquiries adds up. But how much does it really cost your practice? This isn’t just about frustration; it’s a quantifiable operational expense that impacts your bottom line. This article will delve into this hidden cost, explore why it occurs, and provide a practical way for your practice to estimate the financial impact of staff time spent on patient billing questions.

The Constant Stream: Why Dermatology Patients Have Billing Questions

Dermatology billing can be particularly complex, leading to frequent patient confusion and questions. Some common reasons include:

• Insurance Complexity: Navigating Explanation of Benefits (EOBs), understanding in-network vs. out-of-network benefits, and dealing with varying plan coverage for different procedures.
• Cosmetic vs. Medical Billing: Distinguishing between services covered by insurance (medical) and those that are self-pay (cosmetic) is often unclear to patients.
• Deductibles and Co-pays: Patients may not understand why they have a balance after an insurance payment, especially early in the calendar year.
• Coding Confusion: Medical codes (CPT, ICD-10) on statements can be cryptic.
• Multiple Visits/Services: Dermatology often involves follow-up visits or multiple procedures in one visit, leading to longer statements.
• Payment Plan Inquiries: Patients needing to arrange payment terms.

This steady flow of inquiries lands squarely on your administrative and billing staff.

Beyond the Call: How Staff Time Gets Consumed

Handling a patient billing question involves more than just a quick chat. Each inquiry, whether via phone call, email, or in-person, triggers a chain of tasks that consume valuable staff time:

• Answering Calls & Emails: The initial contact requires staff to stop their current task and engage with the patient.
• Account & Claim Research: Staff must access the patient’s file, review visit details, check the claim status, analyze the EOB, and verify insurance information. This can involve navigating billing software and payer portals.
• Statement Explanation: Translating complex medical jargon and insurance terms into language the patient understands.
• Coordination: Sometimes, the staff member needs to consult with a biller, a coder, or even contact the insurance payer directly for clarification (which can involve significant hold times).
• Dispute Resolution: Investigating potential errors or appealing denied claims based on patient inquiries.
• Setting Up Payment Arrangements: Discussing options and processing payment plans.

Each step takes time away from core duties like submitting claims, working denials, following up on unpaid accounts, or managing credentialing tasks.

The Productivity Drain: The Opportunity Cost of Answering Questions

Every minute a staff member spends on a patient billing question is a minute they aren’t spending on tasks critical to your practice’s revenue cycle management (RCM). This is the opportunity cost – the value of the next best alternative forgone. When staff are constantly interrupted to handle inquiries, their productivity on core billing functions decreases. For instance, the number of claims they can process or denials they can work per hour goes down. While specific industry benchmarks for time spent solely on patient questions are hard to come by, research indicates that inefficiencies and errors in medical billing contribute significantly to financial losses [source]. Addressing billing holds and denials efficiently is key, but constant interruptions from patient questions can delay this critical work [source]. The cumulative effect is slower cash flow, increased accounts receivable (A/R), and a higher risk of claims missing timely filing deadlines.

Calculating the Hidden Cost: Putting a Number on Staff Time

Quantifying the exact cost across the entire healthcare industry is challenging, as data specifically isolating “time spent answering patient billing questions” isn’t widely published. However, you can estimate this cost within your own practice using a simple method. Here’s how to approximate the cost of staff time dedicated to patient billing inquiries:

1. Estimate Average Time Per Inquiry: Track a sample of billing inquiries over a week. How much time does it take, on average, for a staff member to fully resolve a patient’s billing question (including research, communication, etc.)? Let’s estimate conservatively, say, 10 minutes per inquiry.
2. Estimate Weekly Volume of Inquiries: Count or estimate the number of patient billing-related phone calls, emails, and in-person questions your staff handles in a week. Let’s assume 40 inquiries per week.

3. Calculate Total Estimated Staff Hours Per Week: Multiply the average time per inquiry by the weekly volume.
   • 10 minutes/inquiry * 40 inquiries/week = 400 minutes/week
   • Convert to hours: 400 minutes / 60 minutes/hour = ~6.7 hours per week

1. Determine Average Hourly Wage: Use the average hourly wage for your administrative or billing staff involved in these tasks. According to the U.S. Bureau of Labor Statistics, the average hourly wage for medical administrative assistants is around $20-$21 [source, source]. Let’s use a conservative estimate of $20 per hour for this example.

2. Calculate Estimated Weekly Cost: Multiply the total estimated hours per week by the average hourly wage.
   • 7 hours/week * $20/hour = $134 per week

1. Extrapolate Annual Cost: Multiply the weekly cost by 52 weeks.
   • $134/week * 52 weeks/year = $6,968 per year

This is just a hypothetical example. Depending on the volume of inquiries and the complexity of your billing issues (which often trigger questions), the actual cost could be significantly higher. Consider if multiple staff members are involved or if some inquiries require much longer research or follow-up.

The Ripple Effect: More Than Just Wages

The financial cost calculated above is just one piece of the puzzle. Spending excessive time on billing questions also leads to other negative consequences:

• Staff Burnout: Repetitive, sometimes frustrating, billing interactions can lead to stress and reduced morale among your valuable staff.
• Increased Errors: When staff are rushed or interrupted, they are more prone to making mistakes on claims or patient accounts, perpetuating the cycle of billing issues and subsequent questions.
• Delayed Cash Flow: Time spent on questions is time not spent collecting revenue, increasing days in A/R.
• Suboptimal Patient Experience: If staff are overwhelmed with inquiries, they may not provide the level of service patients expect, potentially leading to dissatisfaction or negative reviews.

Addressing the root cause of these questions and streamlining how they are handled is crucial for operational efficiency and financial health.

Reducing the Burden: Strategies to Minimize Billing Questions

The good news is that this significant time drain can be reduced. Strategies focus on proactive communication, improved processes, and leveraging expertise:

• Clearer Patient Statements: Design statements that are easy to understand, clearly distinguishing between medical and cosmetic services and explaining patient responsibility.
• Patient Education: Provide upfront information about insurance verification, potential costs, and payment policies. FAQs on your website can also help [source, source].
• Streamlined Processes: Ensure your internal billing workflow is efficient, reducing errors that lead to questions.
• Leveraging Technology: Utilize patient portals for access to statements and payment options, and ensure your billing software supports clear communication.
• Considering Specialization: Partnering with billing specialists who understand the nuances of dermatology billing can proactively address issues before they turn into patient questions.

Conclusion

The time your staff spends handling patient billing questions is not ‘just part of the job’ – it’s a real, quantifiable cost to your dermatology practice. While there isn’t a national average for this specific metric, you can use a simple method to estimate the financial impact within your own practice. Recognizing this hidden cost highlights the importance of billing efficiency. Reducing the volume of questions through clearer communication and streamlined processes, and ensuring any questions that do arise are handled swiftly and accurately, improves not only your practice’s profitability and cash flow but also boosts staff productivity and patient satisfaction. Understanding this expense is the first step towards optimizing your revenue cycle management and allowing your team to focus on what they do best. Contact Derm Care Billing Consultants today for further information on how we can help your practice.