Legal Bill Review: Best Practices & How You Can Save Money | LSG
Published by Matthew Markham on Mar 25, 2020
We work with companies from consumer & retail corporations to fund administrators to insurance companies, and find that they all face overbilling issues associated with their legal invoices. The overbilling issues have nuance from industry to industry, and it makes sense that we’re consistently ranked within the top 3 legal bill review companies because of this expertise…we’ve built up knowledge over more than 15 years. But how does this help you? Well, we’ve put together a few pointers that should get you off to a running start, and feel free
In this article, we wanted to share a few pointers outside of the industry nuances that will help your company save money on your legal invoices. Keep in mind, you will have to bake these conditions into your engagement letters with law firms, but they are all standard fare, and if your law firm doesn’t accept these criteria, then it’s time to find a new law firm. Here are some of the basic issues, how to identify them and why they’re an issue:
Lawyers performing paralegal tasks
- As a common practice, appropriate counsel seniority should be applied depending on the type of work performed. In other words, tasks that could utilize a paralegal without sacrificing output quality should utilize a paralegal. For example, paralegals should perform legal research as it applies to case law precedent.
- Resolution: you should be able to push back on your counsel for charging associate or partner rates for paralegal tasks. We would typically apply the lowest paralegal rate available in the law firm to these items, or we would use an industry average rate. For example, on a litigation case, $24.50 per hour would be fair, based on the Bureau of Labor Statistics.
Non-billable local travel time
- As per many insurance firm’s billing protocols, “local travel” time is non billable. A roundtrip travel time of one hour or less is considered as “local travel.”
- Resolution: you should consider the first hour of any travel as “local travel,” and reimburse the travel time excluding the first one hour of travel. Sounds trivial, but it adds up.
No prior approval for legal research
- As per industry best practices billing protocols, a prior consultation needs to be indicated in the line entry description for billing legal research that exceeds one hour.
- Resolution: you should be able to reject line items in invoices that relate to legal research beyond one (1) hour if your counsel did not attain prior approval. This line item also touches on lawyers performing paralegal tasks, so keep an eye out!
These are just three examples of a library of billing best practices for outside counsel, not including those specific to industry, such as rules relating to relative risk invoices for the healthcare industry.
If you are looking for a flat rate partner in legal bill review, one able to guarantee a lower cost for any existing cost containment strategy you having currently, reach out to us at [email protected]. You’ll save 6-11% per invoice, and we’ve already been successful in saving our clients over half a billion dollars ($500M+) in legal invoices.