Bill Sample / December 8, 2018 / Lessie Larson
This lag time roughly averages across all payers making DAR an effective comparison metric between payers for individual provider but invalidating it across multiple providers. One obvious advantage of DAR metric is its independence of charges. The averaging feature of this metric eliminates sensitivity to specific day or CPT but also hides the behavior shape of the accounts receivable curve. First-Pass Pay (FPP Rate) and Denial Rate FPP is the percentage of claims paid in full the first time upon submission (subject to federal or state timely payment regulations: 15 days for electronic submission and 30 days - for paper). Denial rate is the complementary metric to FPP rate. It counts the percent of claims that require followup and therefore cost more to process.
When we started our Medical Billing Service in 1994 there was very little information available on medical billing services let alone medical billing service contracts. In fact some of the information indicated that you really didnt even need a contract if you didnt want one. That couldnt be further from the truth! Having a contract for your Medical Billing Service is very important to protect both you and the provider. Many new billing services ask us for a sample contract or a copy of our contract. Using a sample contract or somebody elses contract is not a good idea. It would be like taking somebody elses will whiting out their name and writing in yours. The only time it will hurt you is when you die and then your family could be in trouble.
It may be expected as when someone retires or it may be unexpected but you need to have a plan in place for when the relationship ends. It will be a much better parting of ways if you have a plan of action for how things will be handled. The whole reason for a good contract is to protect you but your contract can do much more than protect. You can weed out potential problem providers that will drive you crazy. If you are not in agreement with your providers on what each of you will be contributing to the relationship then the likelihood of the account going smoothly is very small. Dont make the mistake of skimping on an important part of your business that may save you from defending yourself in court down the road.