Centralized vs. Decentralized Billing

When philosophizing about how healthcare organizations are set up, there comes a point very early on in the haze of buzzwords where a mental sparring happens over whether the physician practice billing should be centralized or decentralized.  Now, I’m not old enough to have been around when this debate first came about, but the trend over the past couple of years has been to move to a more centralized approach.  This comes about as healthcare organizations are placing their physician practices under a single and separate business entity with the intent that they are going to also wrap up any neighborhood independent physicians as well.

If history has taught us anything, in a few years when all of this ‘Meaningful Use’ business dissipates we’ll see physicians yelling to get out from under the umbrella and hospitals coming to the ‘new’ conclusion that it’d really be more efficient if everything was under the same business entity instead of a division down the middle.  This is not-so-coincidentally when we’ll see the shift back to decentralized billing.  Here’s the thing though, the structure of the billing component doesn’t really matter.  Don’t listen to the kid who got his/her MBA immediately after finishing their college courses and is spouting case studies at you.  It. Really. Doesn’t. Matter.

What does matter?  Two things: Billers that know the individual practice quirks and those that adhere to the organization’s standards of procedure.  The theory goes that you inherently get local knowledge of the practices through decentralized billing and you get standard practices across the board through centralized billing.  The reality is that when an organization has fewer resources for billing, they centralize (more work loaded on to fewer people) and when they have a surplus, they decentralize (hoping they can create more work to do by being at the practice).

Unfortunately, it’s because no one has found the perfect solution to get that local knowledge yet maintain standards that everyone keeps seesawing back and forth.  All you really need to do those is make sure both of those items are being met.  Therefore, if any consultant comes in spouting buzzwords like synergy, optimization or the like, it really is ok to give them a gentle push out the door.


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