In this dynamic and ever-evolving healthcare landscape, medical billing – as important as it is – is often overlooked. Many practice runners don’t consider it the primary focus and hence compromise on the financial well-being of their facility.

With the healthcare industry reaching $11.9 trillion in 2025 and expected to grow manifold in the times to come, this meteoric expansion is likely to bring some challenges and complexities alongside. And surprisingly, small practices are supposed to feel the brunt.

Why is it so?

Because when it comes to patients’ preferences and the provision of quality care, size does matter! The bigger, the better mantra doesn’t always succeed in the healthcare industry. Most patients prioritize small practices rather than large healthcare centers or hospitals.

The reason? It Helps Them Seek Quality and Personalized Care

Look for small specialty practices and clinics around you. You’ll definitely notice that smaller practices experience less influx of patience. Moreover, their everyday footfall is much less than larger specialty practices, clinics, and hospitals.

Patients visiting smaller practices allows healthcare providers to better connect with them. It helps build trust, eases the transference of healthcare issues troubling them, and ensures lasting relation between you and quality care seekers.

According to a study done by Health Affairs, practice size is directly proportional to care outcomes for patients. Personalized care, unmatched services, and peace of mind that patients have regarding medical specialists at small practices result in exceptional outcomes.  

The Real Dilemma for Small Practices

No doubt that patients experience superior outcomes from small practices, but still, there are some challenges that hamper their progress. One of the most notable challenges they confront is RCM optimization and medical billing issues.

If not addressed properly, these administrative conundrums disrupt clinical, operation, and financial processes. Medical billing issues affect the cash flow and revenue generation opportunities. Healthcare providers start facing economic challenges, leading to financial instability.

The result? It diverts the doctors’/physicians’/specialists’ attention towards maintaining a continuous cash flow instead of delivering compassionate care to patients. After all, they have utility bills, staff salaries, and rent to pay.

Are you one of those small practice owners or managers unsettled by challenges? Want expert guidance on how to tackle these obstacles stymying an uninterrupted revenue stream? You’re at the right place. In the next sections, we’ll take you through emerging challenges bothering small practices and how to counter them.  

Medical Billing Challenges and Solutions for Small Practices

The cat and mouse game between practices and challenges affecting their progress is a never-ending one. Some practices overcome these challenges, while others continue to struggle with problems that impede their turnover.

If you want expert solutions for your small practice to succeed on operational, clinical, and financial frontiers, just stay put as we go through the common challenges and how to tackle them.

Medical Billing Services for Small Practices – I-Med Claims

Challenge 1: Coding and Documentation Errors

Inaccurate coding always leads to denials. The same can be said about documentation. A small human error or lapse in concentration results in overcoding and undercoding. It will cost you dearly.

Not using the precise codes or missing out on important information means compliance issues, claim approval delays, underpayments, and even denials, increasing the financial burden on your small practice.

Solution

  • Invest in training about medical coding and ensure your staff is acquainted with the latest coding updates and guidelines.
  • Ensure stringent audits to pinpoint errors in coding and that they’re rectified before submission.
  • Integrate the latest coding tools or software for real-time coding help. It also helps to stay safe from compliance issues and provides updates regarding coding guidelines.
  • Establish a strong bond between medical billers and coders and in-house staff to mitigate errors and mistakes in coding and documentation.

Challenge 2: Timely Claim Submission

Correct and timely claim submissions go hand in hand. Delaying the claims will result in the payor deducting your revenue, prolonged approval time, and even denials.

All these outcomes result in dwindling capital. So, focus on timely submission just as you create error-free claims. Complimenting timely submission with flawless claim creation relieves you from the worries about partial or rejected payments.

Solution

  • Create an SOP that ensures timely submission of errorless claims. Focus on correct data entry and timely submission after thorough verification of information.
  • Invest in modern processes like electronic claim submission and follow-ups. Automating these processes lowers the risk of errors, expedites workflow and accelerates income.
  • Automate RCM processes like scrubbing, editing, and submitting to the insurance. The reduction of manual input will elevate the quality and lower the chance of errors.
  • Track the progress of your claims and identify what’s extending the payment cycle. Pick out the inefficiencies that cause stuttering.

Challenge 3: Denial Management

Claim denial is the biggest enemy hurting your RCM and practice’s financial security. Small practices don’t always have the luxury of hiring experienced and competent medical billers and coders. So, the percentage of denials affecting a small practice may be high as compared to a large one.

Turning denials into approvals is time-consuming and resource-heavy as it increases administrative burden. It requires more effort, increased costs, and dexterity to counter denials, rectify issues, and extract full payment against a service.

Solution

  • Counsel your in-house team to pay close attention to detail and ensure no errors, missing information, or submission guidelines result in a denial.
  • Invest in a strong denial management process and a skillful team. Both or either of the two will benefit you in eliminating the root causes of denials by spotting errors and addressing them.
  • Train your medical billers and educate them about the denial reasons, complete documentation, and correct medical classification using CPT, ICD-10, POS codes (POS 21, etc), and HCPCS modifiers.
  • Teach them how to resubmit a claim after rectifying the issue and the significance of strategizing appeals and persistent follow-ups.
  • Use software that helps you and your staff to analyze denials patterns and tracks appeals. Another way to turn denials into approvals quickly is by promoting chemistry between billers, coders, and clinical staff.

Challenge 4: Patient Eligibility and Insurance Verification

Verifying patient eligibility from the payor is an integral part of medical billing. Doing so inaccurately means denials, increased financial burden on the patient and potential compliance issues.

Solution

  • Make sure your in-house resources are efficient in eligibility verification from the insurance. This confirmation of coverage details and benefits before the provision of services helps them clarify everything and convey to patients their financial responsibility.
  • Outsource eligibility verification or BOB process to a leading medical billing company or integrate automation to simplify the process. It requires less effort and helps minimize errors.
  • Arrange training for your front-desk representative to educate them regarding the significance of correct processing and how it helps you to collect complete reimbursements after a patient’s visit.

Challenge 5: Managing Payor Contract Terms

Another challenge small practices across the US commonly face is managing multiple payor contracts and other aspects. These include reimbursement rates, fee schedules, and other intricacies. All these things, if handled inappropriately, result in billing errors, underpayments, and even overpayments.

These are considered malpractices in the medical billing world. This can damage your practice’s credibility, and the insurer might also take legal action against your practice.

Solution

  • Store, organize, and manage payor contracts, payment structure, schedules, and reimbursement rates from a centralized location.
  • Regularly update payor contract terms, fee schedules, and reimbursement rates to always comply with the payor requirements.
  • Educate the medical billing team on how to apply updated contract terms and the latest fee schedules so that you or the patients don’t face any unwanted situations.

Challenge 6: Complying with HIPAA and Other Regulations

One of the most challenging things for small practices is ensuring compliance with HIPAA, state and federal laws, and bylaws. This not only helps to protect sensitive information and uphold patient privacy but also helps to stay safe from legal implications and costly errors.

Solution

  • Arrange periodical HIPAA training for your in-house medical billing team.
  • Create awareness regarding the significance of protecting crucial data.
  • Implement policies and procedures to safeguard information as directed by HIPAA. Ensure secure handling and transmission of PHI to avoid legal complications.
  • Address any risks and vulnerabilities based on stringent auditing process as advised by HIPAA and state regulations.
  • Outsource medical billing services to a trusted and HIPAA-compliant third-party medical billing agency that secures data via end-to-end encryption.

Challenge 7: Managing Accounts Receivables

Careless and inefficient handling of bills leads to increased AR. Simply saying, you’ll have to deal with overdue, unpaid, and disputed payments which is time-consuming and not less than a hassle. Moreover, increased AR times mean less revenue for your practice and instability, which is not what you want.

Solution

  • Enlighten your team about the drawbacks and shortcomings of errors that can lead to payment disputes and revenue getting stuck with the payor.
  • Continuously track and monitor accounts receivables, aging reports, and the outcomes of appeals and follow-up procedures.
  • Maintain clear communication with patients as well as insurance companies to address stuck payments swiftly and resolve any disputes without legal obligations.
  • Integrate software that manages AR-related matters and components like statement creation, payment posting, and aging report generation.

Challenge 8: Optimizing Revenue Cycle Management (RCM)

A smooth, optimized, and intelligent revenue cycle management is integral for every practice across the US. Whether small or large, it ensures efficiency, ideal results, and enhanced payments. Simply put, it enhances revenue, lowers costs, and reduces errors.

On the flip side, an RCM full of errors and obstacles means delayed revenue, a large percentage of denials, and a poor financial collection rate. In general, an unattended RCM and disorganized billing processes mean less profitability, more revenue loss, and huge bad debts.

Solution

  • From creation, scrubbing, and submission of bills to eligibility verification, AR, denial management, and receiving on-time payments, a comprehensive RCM checkup helps to identify inaccuracies and areas of improvement.
  • Streamline workflows and invest in automation tools. It will ease time-taking and complicated processes like appointment booking and registration, insurance verification, claim submission, resubmission in case of denials, AR follow-up reporting, and receiving payments in practice accounts.
  • Identify errors and areas of improvement by taking advantage of data analytics and modern reporting tools. It allows you to rectify errors, streamline processes and, above all, enhance revenue collection.
  • Develop collaboration between all teams involved in the RCM. Expect wonders when your front-office staff, medical billers, coders, denial management experts, and clinical staff are on the same page, communicating and working for a collective goal – maximized reimbursements and fewer errors.
  • Collaborate with a market leading revenue cycle management company that ensures a seamless RCM through customized solutions based on your size, location, specialty, patient footfall and other unique needs.
  • They have large teams of specialist medical billers, knowledgeable coders, skillful A/R managers, proficient denial management pros, and professional credentialing experts.

Final words

Being a small practice in the American healthcare landscape comes with a lot of advantages. However, just like every rose has thorns, the same way, there are some downsides or challenges small practices have to navigate through.

A large majority of patients prefer small practices owing to personalized and top-notch healthcare services, a strong bond between patient and provider, and excellent health outcomes. However, on the provider’s part, small practices face certain challenges that can be hard to streamline.

Hiring a reliable and top-tier medical billing company will ease everything for you. They’ll provide all-inclusive RCM services so that you don’t have to spend hours in piles of boring paperwork and dealing with administrative conundrums.

As a healthcare provider working for a small practice or managing it, you have complete peace of mind that you’re free from the technical and complicated tasks while experts are working on your behalf.

They’ll document the encounter, enter complete details, create flawless claims, use precise codes to classify diagnoses or treatments, ensure no errors or mistakes, submit the claim based on every payor’s specific guidelines, and transfer payments to your practice’s account without any hassle.

Are you a healthcare provider working in a small practice? Want immaculate medical billing services at the most affordable services? Look no further and get in touch with the best in the business, I-Med Claims.