Profits and revenue seem to be harder and harder to maintain in today's market, and likely you are experiencing the same thing in your law practice. Consider another way to increase lawyer profitability per client.
Like most law practices, you have cut you overhead to the bone, reduced expenses in every possible way. There is no more 'fat' to cut. Removing any more expenses has a negative effect on profitability. Instead, look in a totally different area.
When working with a client’s medical bills and hospital charges due to personal injury, workers compensation cases or vehicular accidents, the amount you eventually pay hospitals and other medical service providers has been overpaid by 25% to 450%.
This leaves on average, many tens of thousands of dollars on the table. Paying the hyper-inflated billing from one hospital stay could be better spent for a year's salary for another paralegal; the entire cost of a new office computer network; or just bottom line dollars to the firm’s capital. If your firm handles several client hospitalizations, you might find hospital bill reviews could be a whole new profit center for your firm.
Hospitals say they charge everyone the same for procedures, but ALLOW different payment amounts for different payers. As a result, individuals without medical insurance and victims of auto or work accidents where another is at fault, have the highest pricing tier. Further down, individuals with medical insurance coverage with pre-negotiated payment structures pay less, approximately 50% less than uninsured individuals. The lowest pricing tier is allowed for the largest of all groups paying for medical services – the government. The Center for Medicare/Medicaid Services, overseer of Medicare and Medicaid, has structured payments for every medical service with built in profit for the hospital or medical service provider at a much lower price than even pre-negotiated medical insurance plans.
Up front, the client's hospital bills give you a strong case to recover more compensation for your client. However, consider how much more money would be available to your client, and subsequently your firm, if you settled on a much smaller portion of that hospital bill? Hospital bill audits routinely find overcharges, mistakes and clerical errors that are missed and subsequently inflate the bill.
So, even if your firm regularly negotiates the final hospital bill you still maybe overpaying. If you pay only 50% of the bill, you are still overpaying by 50% to 100% in most cases.
Negotiating final payment to hospitals is haphazard if you’re guessing what they will or won't accept. A true accounting of the bill as generated by a billing audit shows valid reasons for a lower payment. And the specialized negotiation by recovery experts means less money for each hospital and medical service. But, without solid facts to support the reduced payment amount, negotiations are time consuming and sometimes ineffectual.
Qualified medical bill review firms have the ability and knowledge to find the hidden dollars that are part of your bottom line you have yet to realize. Many review and recovery companies work on a contingency basis, so no funds come out of the firm's or your client's pocket. Most only receive payment if they find and recover money. It is a no-cost, win/win situation. Your client receives a larger settlement and you and your firm gets a larger fee. As a result, with no investment or reduction of resources you have instantly improved lawyer profitability and increased attorney revenue.
Cutting firm overhead goes only so far until it hurts productivity and profitability. Past methods of addressing client hospitalization have been leaving too much money on the table. Using the services of experts to reduce hospital payments is a fast, efficient way to increase attorney revenue.
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