If this scenario sounds like like your office, it's time to look seriously at outsourcing. Yes, there are people in the business of providing billing services specifically for attorneys. Imagine handing over all of your office’s billing processes to a trained professional who already has the right hardware and software, who’s figured out the monthly billing cycle, who has backup procedures in place, and who can work with you to accommodate your particular client mix. It just might be your first “out-of-office” experience!

HIGH-TECH BILLING COMPONENTS
The outsource company uses billing programs created specifically for the legal market. However, the billing program is a complex animal. It is not a word processor that does a few table, column and math functions. Instead, it is a database that tracks numbers, dates, client names, addresses and matters. It keeps time, costs, payment and trust entries separated between matters, and tracks what has been billed to the client and what has not.

The billing program, a date-driven database system, has a cycle to it that you determine. However, it is rare or nonexistent for program user manuals to explain the billing cycle in a useful format that you can implement in your law office. That depends on how you feed information into your billing system and how you manage results.

LEGAL INFORMATION FEEDING
As soon as your law office is established, tracking accounts receivable and billing issues can become complex. Forms naturally have to be created to manage the day-to-day functioning of the office. These forms cover issues ranging from requesting checks to tracking costs and to whom those costs should be charged.

The bookkeeper or billing clerk must identify between three types of bills:1) operational (incoming, a.k.a. accounts payable); 2) client (outgoing, a.k.a. accounts receivable); and 3) forwarded (throughput, to pass on to another firm or client for payment). Different forms and a separate tracking system are set up for each type. These forms are individual to the professionals who use them, they remain unknowns to software makers, who can only generalize regarding the basic process of collecting data.

Over time and through growth, each law firm becomes a customized office because of its people, its forms, its business decisions, and its client needs. No wonder it’s difficult for computer systems to fill the law-firm market’s needs in any but the most generalized way.

This seemingly overwhelming task can be reduced by outsourcing a portion of these administrative functions. The outsource company concentrates on the second type of billing – client, or outgoing bills. This is the most time-intensive of the three types listed above.

THE INSURANCE COMPONENT
Historically, the insurance industry has been a factor in attorney billing. In their efforts to contain legal fees in insuring their clients, they have imposed coding requirements whereby fee tasks and costs must be coded 

The outsource company accommodates insurance company coding requirements and can submit bills electronically for a law firm. Hard copies of  electronically-submitted bills are provided with confirmations, so the attorney knows what deposits to expect to receive through his or her bank account.

BETTER BILLING THROUGH OUTSOURCING
In hiring a billing outsource company you don’t have to buy computer hardware or software. The outsourcer has backup system procedures secured and in place. It is actively managing Year 2000 issues. It consistently processes your monthly bills, providing you with three products each month: a work-in-process (WIP) report, statements and then reports to cover the billing period. The outsource company has forms for you and forms for itself. It has already figured out tracking and has simplified the process to a manageable level. The outsourcing staff works with you to set up your ofFice procedures to interface with theirs easily, effectively and efficiently.

The outsource company needs the attorney to provide two critical dates: 1) when the bills are to be out each month, and 2) the cutoff date for time entries to be included in the statements. The process is scheduled around those two dates. To complete the process, the outsource company requests the attorney’s timesheets be provided weekly, and costs, client payment and trust information be provided monthly, in time to input before printing the WIP.

Faxing has been the most popular method to submit information in a timely fashion, and it allows both parties a copy of the work. The attorneys maintain their original timesheets and cost information, and the outsourcer is provided a working copy from the fax machine, which is entered directly into the computer.

The latest outsourcing tool is sending secured information via the Internet. Depending on whether the outsource company has a secured web site or not, data can be directly entered through a secured connection. Users can also attach documents to e-mail. This can cut down input time depending on whether the users  attach batches importable to the billing program, or attach word processing documents that will need inputting at the outsource company's site.

OUTSOURCING MEANS BUSINESS
Outsourcing the billing function offers you, the attorney, many benefits. Having a consistent schedule for billing clients and staying on top of accounts receivables is one of the keys to consistent income. When you have monthly information about your accounts receivables in hand, you don't have to remember who has paid you and who hasn’t. You also can afford to forget about billing until you see your WIP, statements or reports come across your desk. Simply stated, using a billing outsource service frees your mind to concentrate on what you do best – being a lawyer. 
 

Jeanine Rogers is the founder of TimeBillers, Inc., a Portland-based billing outsource service specializing in attorney/client billing. She publishes a free monthly electronic newsletter, TBI Legal Billing Tips. To receive it, click here.