In recent years, an increasing number of medical institutions and healthcare practices of all sizes have been turning to outsourcing their medical billing needs, rather than tasking them to their in-house administrative staff. While this trend is increasingly popular with small practices and solo practitioners, even larger clinics have realized the benefits of third-party medical billing services.

Not only does outsourcing free up time for you or your administrative staff to focus on patient care, but it also helps reduce unnecessary delays and errors. This translates into fewer claim denials and rejections as well as a more consistent revenue stream.

If you are interested in outsourcing your medical billing needs there are a few important things to consider to make sure you are choosing the firm that is best for you.

Assessing The Scale Of Your Practice’s Medical Billing Needs

There are medical billing firms of all sizes. Some are geared to handle large clinics and medical institutions with multiple physicians or specialists. While other medical billing services focus on smaller practices and solo practitioners who would rather spend their time focused on patient care.

When assessing the scale of your practice’s medical billing needs it helps to look at a few key factors. This includes:

Practice Size

Your medical billing needs will certainly expand in scale based on the number of physicians and specialists you have in-house.

The number Of Insurance Carriers

The more insurance carriers your practice accepts the larger your medical billing needs will be to effectively streamline your claims process and revenue stream.


Assess your budget and how much you want to allocate toward medical billing services versus the cost of hiring in-house administrative staff to handle it. Most practices find it more cost-effective in the long-term to outsource, rather than add staff.

Small-Scale Billing Services

There are medical billing firms of nearly every imaginable size. Small scale medical billing services tend to be geared to work closely with small practices and solo practitioners. They also tend to have a smaller initial setup cost and are specialized to handle small data volume. They also tend to be more cost-effective, and some even assign you a dedicated representative who is intimately informed of your practice’s needs.

A Physician Practice Management Company

Many practices will turn to a physician practice management firm to provide medical billing services as well as other related needs like verifying records and revenue stream management. These medical practices tend to have physicians and staff of 100 to 200 professionals. Physician management companies tend to be geared to handle a higher volume of data, and claims. They might also offer additional coding services and other administrative tasks for an additional cost.

A Large-Scale Professional Billing Company

Large scale professional medical billing companies are designed to handle a massive volume of data claims processing and other administrative tasks. This frees up physicians and staff to focus exclusively on patient care, as well as other things like expanding the size or scope of their practices. Though with these additional features you are also looking at a larger overall cost for the service.

Medical Billing Services For Specialists

Some medical billing firms are geared to handle administrative needs for specialty practitioners. If you have a solo or small medical practice that focuses on one specialty or related treatments, you might want to prioritize a medical billing firm with a reputation for working with your particular specialty. An experienced staff is more likely to understand the fine details that help catch billing and coding errors. Many of these specialty firms tend to be small, and offer greater attention to detail or offer dedicated representatives.

Questions To Ask When Exploring Your Medical Billing Service Options

When you first start shopping for a medical billing firm that’s right for your practice, the number of options can feel staggering. Though there are a few key questions you can ask that will help give you a better barometer on which medical billing firm is best for your medical practice.

  • How much experience does your medical billing firm have with our specialty?
  • Does your staff have training in my specialty?
  • How many billers will be managing my practice?
  • Do your representatives receive continuing education and training?
  • Do you have any testimonials you could share?

Request A Cost Breakdown Or Fee Structuring Information

Medical billing firms may have different prices or fee structures depending on the specialty practice they focus on as well as other administrative services that they offer. In some cases, bundling multiple administrative services into one contract will provide you with a lower unit cost for medical billing.

There are a few different ways that a medical billing firm might handle their fee structure. If you are only planning to contract them for medical billing services then the standard is to charge a small percentage of the net collected revenue. This could vary from 3 to 10-percent and could be influenced by your practice’s area of specialty. If you are interested in contracting a firm for other administrative tasks they might charge you a flat fee plus a small percentage of the net collections from their medical billing.

Vetting & Compliance

Strict regulations are in place for all medical and healthcare institutions. This includes HIPPA compliance laws that need to be abided by at all times. When you first engage in the negotiations process with a prospective medical billing firm, make sure to request all pertinent compliance information. Most have some type of compliance documentation already prepared that demonstrated all their staff is trained and follows all necessary regulations.

Reviews & Testimonials

The internet has made it easier than ever for clients and patrons to post reviews about the service they have received. Taking the time to read through a medical billing or administrative firm’s reviews will help you understand their strengths and weaknesses. If they don’t have any online reviews, you should ask the firm if they have testimonials or references. Unless they are very new, and small, they should be able to provide you with something. You should beware of a company with no reviews or testimonials.

Dedicated Representatives Or Service Team

If you are a solo practitioner or part of a small practice, you might want to prioritize a medical billing service that provides you with a dedicated representative or a dedicated team of professionals. This way they can develop an intimate understanding of your practice’s needs over time.

Communication Expectations

Communication and information flow is a critical component in maintaining a consistent revenue stream. Ideally, you want to contract a medical billing service that has transparency practices in place and has a reputation for responding quickly to their client’s questions. That way if there is an issue with a claim you the practitioner and your patient aren’t left in limbo.

During the negotiation process, ask the firm about their communication style and protocols. They should be able to provide you with some basic information about their average response time. This is more likely to be shorter for a medical billing firm that provides you with dedicated personnel.

Rejected Claims Policies & Procedures

Rejected claims are an unfortunate part of the medical billing process. Though most medical practices find the rate of rejected and denied claims go down when they outsource their medical billing needs to a third-party firm.

During the negotiation process ask the firm how they handle rejected and denied claims. Most have protocols in place that are designed to catch potential coverage lapses and errors, as well as policies for how to handle resubmission. This is especially important if you will be asking them to handle a high volume of claims.

ICD-10 Software

ICD-10 is the latest software used for the International Classification of Disease code. Ideally, you want a medical billing service or administrative firm to have staff members who are proficient in ICD-10 and receive continuing education on similar industry coding methods. This will go a long way toward preventing coding errors and speaks to the overall vigor of the firm.

Deadline Protocols

Like all businesses, the ability to meet deadlines is of critical importance. It’s especially important in medical billing as many insurance providers place strict deadlines on when a claim needs to be submitted, based on the time of service. Ideally, you want to see a medical billing or administrative firm that has solid deadline policies and a reputation for never missing a deadline.

Emergency Continuity Plans

Natural disasters and pandemics can strike medical billing firms just like any other professional arena. Not to mention the convenience of a technology issue leading to data loss. You want to prioritize a medical billing firm that has state-of-the-art data backup policies, as well as protocols for how to handle an emergency. That way you can trust that even if disaster strikes their office, they will still be able to provide you and your patients the services you need.