When Bob Nichols sold his medical billing company in 2007, he thought the time was right to walk away from the industry. He was faced with needing to update his medical billing software platform, and the political uncertainties surrounding the financing of health care clouded the future of the profession. After 20 years in the business, both Bob and his wife Karen, co-owner, thought they were ready for retirement. They sold the company, which at the time had 52 employees and 110 providers as clients.

“Before I sold the business, I spent considerable time looking into new software,” he recounts. “Buying a new system would have cost between a quarter of a million and $400,000 dollars. That is a substantial lease payment.” When Bob learned about Kareo in 2006, he thought the platform was attractive—software-as-a-service with a month-to-month rental arrangement and little to no up front capital expense. It was an observation that he would explore again after he decided to open another medical billing company in May 2010.

“We had several former clients call and ask if we would come back into the medical billing field,” Bob says. “Some of the providers had changed billing companies several times since we exited. They ended up losing substantial amounts of money from AR that did not get transferred to the new billing companies.” He and Karen were considering their re-entry when another former client buttonholed him in church one day. “He said, ‘We’re all hoping you will come back. You guys were the benchmark of how to run a medical billing service.’ I said I’d get back to him.”

With Bob’s interest in Kareo rekindled, he began seriously investigating its capabilities. He didn’t see a downside. Bob contacted a key employee from his previous company and she was ready to join him in the new enterprise. Open for just a year, they already have 14 provider clients and just under $2 million in receipts.

“Kareo has features that have saved us a significant amount of money,” Bob notes. “They just introduced their integration with Practice Fusion, a free web-based electronic health record package. That integration allows the provider to submit an “electronic” superbill that is delivered directly into Kareo. The first time charges are entered for a patient, Kareo creates an account with all the demographics and insurances. Not only does it save us from having to key in the charges and demographics, we have the comfort of knowing the provider entered the information having access to a current, complete list of CPT and ICD-9 codes. That will be an even bigger help when the more specific ICD-10 becomes required.”

Bob says the payment posting feature is also a time- and money-saver. “We have almost eliminated the mailing of 1500 forms,” he says. “Everything—primary and secondary claims—go electronically, and when ERAs come in they show up on the dashboard. We can post in one hour what would have taken nearly all day on our old system. It’s tremendously more time efficient. That’s definitely shown up as dollar savings on that end.”

According to Bob, the volume of patients calling for explanations on their bill has fallen off significantly, but some still do call. His billers make full use of Kareo’s documentation features when those calls come in. “With Kareo, you don’t have to find boxes of old EOBs or patient charts in order to see what the patient was billed and what for. From the patient account, you can view recent patient statements, encounters and even drill down into the ERA to see what deductibles were due, co-payments paid, coverage information and more. Kareo allows us to handle those inquires quickly, accurately and usually on the first call. It makes the practice look professional and very efficient.”

For medical billing companies that are using another software platform, Bob points out that Kareo is extremely cost efficient when migrating to the new platform. “Most companies are forced to maintain dual systems for a period of time when they change to new software,” he states. “That means two sets of lease and software support payments concurrently—while paying the substantial up front charges associated with getting the new platform in place. You don’t have that with Kareo. With the month-to-month subscription arrangement, you can move one client at a time onto the new system and assume the expense one practice at a time. It is so much more affordable to enter into a SAAS rental model than to purchase a whole new system and maintain dual systems during the changeover.”

Bob has even used Kareo as a recruitment tool for both clients and employees. “I show prospective clients how the task feature in Kareo will facilitate communication between billing and the practice…and even create a “tickler system” for tasks that need to be done at a future date. I assure my clients that they will never lose any accounts receivables data ever again…even if they decide to leave for whatever reason. That’s comforting to those providers who lost AR data transitioning from another billing company. Kareo has also allowed me to hire back some of the experienced billers who worked for me before. Good billers know what bad software looks like. They want software that supports them, not one they have to overcome. Once they see how well Kareo works, they’re in. It wins them over every time.”

← Back to All Case Studies