As a doctor or medical billing company, you play a critical role in ensuring that patients receive the healthcare they need. However, did you know holding onto insurance claims for too long can have detrimental effects on both your practice and your patients? In this blog post, we will explain why delaying payment on insurance claims is not only detrimental but also illegal.
The Dangers of Delaying Payment
1.) Reduced Cash
Flow: One of the most significant dangers of holding onto insurance claims is reduced cash flow. When insurance claims are not submitted in a timely manner, it can take longer to receive payment. This delay in payment can have a significant impact on the financial stability of your practice, making it difficult to pay bills, meet payroll obligations, and purchase necessary equipment and supplies.
2.) Decreased Patient Satisfaction: Patients are becoming more and more aware of the time it takes for insurance claims to be processed and paid. If your practice is consistently delaying payment on insurance claims, it can lead to decreased patient satisfaction. Patients may start to view your practice as unreliable and untrustworthy, which can harm your reputation and drive patients away.
3.) Increased Administrative Burden: Delayed payment of insurance claims can also increase the administrative burden on your practice. As the number of outstanding claims grows, it becomes more challenging to manage and track them. This can lead to mistakes, such as lost or misfiled claims, and can result in additional administrative costs.
Why Holding onto Insurance Claims Is Illegal
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- Violation of Insurance Contracts: When a doctor or medical billing company holds onto insurance claims for too long, it can be a violation of the insurance contract. Most insurance contracts require that claims be submitted within a certain time frame, usually 90 days. If you are consistently holding onto insurance claims for longer than the allowed time frame, it can put your practice at risk of violating the insurance contract and facing legal consequences.
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- False Claims Act Violations: Holding onto insurance claims for too long can also result in False Claims Act violations. The False Claims Act is a federal law that prohibits healthcare providers from submitting false or fraudulent claims to the government. If you are holding onto insurance claims for an extended period and are not actively working to resolve the issue, it can be considered a false claim and result in legal consequences.
Conclusion
As a doctor or medical billing company, it is important to understand the dangers of holding onto insurance claims for too long. Delaying payment on insurance claims can have detrimental effects on your practice, including reduced cash flow, decreased patient satisfaction, and increased administrative burden. It is also illegal, as it can result in violations of insurance contracts and False Claims Act violations.
To ensure the financial stability of your practice and protect your reputation, it is essential to submit insurance claims in a timely manner and work with patients and insurance companies to resolve any issues that may arise. With the right processes and systems in place, you can minimize the risks associated with holding onto insurance claims, and focus on delivering the best possible care to your patients.