The Best Medical Billing Services of 2023

• Medical billing services are third-party companies that handle a medical practice’s revenue cycle management.
• The cost of medical billing services ranges from 3% to 10% of a practice’s monthly collections.
• Based on our research, DrChrono is the best medical billing service for new practices, AdvancedMD is best for large practices, and CareCloud is the most flexible.
• This article is for medical practice administrators considering outsourcing their revenue cycle management (RCM) to a medical billing service.

Medical practices contend with a convoluted billing process involving payers, clearinghouses, rejections and denials. This system can often mean practices have to wait weeks or months to see payment for services rendered to patients. It’s also a highly bureaucratic process, requiring dedicated medical billers and coders creating and tracking claims until payment is received. All these factors could add up to immense costs and serious cash flow challenges.

That’s why there are RCM services, also known as medical billing services. These outsourced services will handle some or all of the aspects of a practice’s medical billing needs. To help you find the best medical billing service for your organization, we reviewed the following services.

*Some billing companies rely on a composite first-pass claims acceptance rate, which may slightly inflate the percentage of claims truly accepted and paid on the first pass.

**RXNT does not offer medical billing services; instead, it provides software used by medical billers in practices and at RCM companies.

Medical practices can expect to pay 3% to 9% of their monthly collections for RCM. Your exact rate will depend on several factors, including your claim volume, average claim value, billing cycle complexity and practice size.

Depending on your rate, outsourcing your medical billing may prove more expensive than hiring an in-house team. However, outsourced medical billing often includes detailed financial reporting and specialty expertise that an in-house team might not offer.

To make the proper choice between in-house and outsourced, you should ask your RCM candidates for full details of the services you get with your plan. You should also clarify whether clearinghouse fees, if applicable, are part of the monthly cost or added on later. Lastly, you should check whether copays count as part of your collections. The answer will affect how much you pay monthly.

These are some of the most important features of a medical billing service:

Charge entry and coding

Though this is not universal, most medical billing service providers will handle charge entry and coding, kicking off the billing process at its very first step. This step even precedes claim scrubbing and submission – without it, the process hasn’t truly begun. If your medical billing company of choice doesn’t offer this service, an in-house staff member will need to handle it.

Claims scrubbing

Thoroughly scrubbed claims are far less likely to result in denials or rejections, especially when your medical billing service of choice includes a rules engine. Companies with these engines automatically check their claims for errors that payers commonly use to deny or reject claims. Once these errors are flagged, you or your medical billing company can revise them and refile your claims with these mistakes excluded. The result will be a higher FPAR and faster payment.

Denied-claims management

No medical billing service can entirely avoid denied claims, but most medical billing companies will manage the revision and resubmission processes when this does happen. Some companies will go the extra mile and prioritize denied claims to get them paid as soon as possible. In either case, your back-office staff won’t be left poring over rejected or denied claims, trying to find and fix errors before resubmission.

Medical software access

While not necessarily reflective of the quality of the billing service itself, most RCM companies include access to their PMS and EMR system in their offerings. This can be a cost-effective way to gain access to some of the top medical software on the market. Most medical billing providers will also require you to use their PMS, though you can typically use whichever EMR system you please. If not, you may have to pay extra to migrate your data from your old EMR system to your new one.

Flexible services

Some medical billing companies can manage as much or as little of the revenue cycle as you need. If you’re only looking for someone to pick up the slack after you file your claims, you can arrange an appropriate deal. But if you’re looking to entirely outsource your RCM, you can do that as well. However, some medical billing companies don’t offer certain services, such as charge entry and coding. In this case, you may need in-house billers and coders.

Integrated clearinghouse

As part of your medical billing service, you want either a fully integrated clearinghouse or a partnership with one that results in no extra fees for your practice. Most of the companies we reviewed have one of these two arrangements, and a small number even bypass clearinghouses entirely and submit medical claims directly to payers. Make sure to ask about clearinghouses and fees anytime you speak with a potential billing services provider.

Follow-up on unpaid claims

Virtually every medical billing company we reviewed will follow up all unpaid claims on your behalf. This service applies to payments from both your patients and their payers. An effective medical billing service will follow up on unpaid claims promptly and repeatedly until the account is settled. When handling patient statements and follow-ups, the best medical billers consider customer service and how their collection efforts could reflect on your practice.

As with any service, a firm knowledge of the advantages your practice will receive is key to your RCM choice. That’s because an in-house medical billing staff is often less expensive, but the benefits of outsourcing may be well worth the extra spend.

• Greater efficiency: Especially if you’re a small practice, outsourced medical billing can be key to ensuring your team isn’t overworked. Small practices’ front-office teams are often jacks of many trades for whom the revenue cycle is tedious, lengthy and complex. Outsourcing the process (partially or entirely) alleviates this challenge.
• Higher accuracy: Claim errors from carelessness are a huge revenue drain. When you outsource your billing to experts, especially those with rules-based engines, you mitigate this risk. These experts and their technology are a powerful combination for identifying potential claim errors and solving them before they become huge issues.
• More collections: Outsourced medical billing teams focus entirely on billing. The result is more collections more quickly. Even the best in-house teams, given their many responsibilities, can rarely achieve the revenue peaks possible with outsourcing.
• In-depth data and analytics: Many medical billing services will analyze your accounts receivable and use the trends they observe to suggest modifications to your processes. You should also be able to create reports at will in the included PMS. Through these reports, you can get a clear view into your finances and see how to adjust your operations for more revenue.
• Practice management consultation: Especially for smaller practices, the consulting services that accompany RCM can precede growth. The operational advice you receive can result in more revenue, which you can invest in hiring more staff or expanding your services. And if you follow your consultant’s recommendations, you’ll be on a fast path to even more revenue soon enough.

As you compare potential medical billing services, take the following steps to determine the best candidate:

1. Get a full picture of the company’s features.

Claim scrubbing and follow-up are par for the course. You’ll also commonly find that RCM companies include reporting, consultation, and EMR and PMS access with your services. Check for these features as you speak with company representatives.

You should also determine whether the features that accompany your medical billing leave the company or your own team responsible for entering and coding charges. It’s worth asking if your billing service candidates are following the most recent ICD-10 coding system updates. You should also get a sense of the billing company’s experience with other practices in your specialty. Lastly, ask about the depth and extent of reporting and analytics solutions.

2. Compare prices.

RCM companies will generally take a monthly percentage of your collections instead of charging a flat fee. The percentage will vary based on the factors described above, and different billing services may quote you different percentages. Think about whether a company that charges you more would provide better services than your other candidates before making a decision.

As you compare prices, you should also check whether the RCM company includes EMR system and PMS access with its billing services. These inclusions may justify the company charging higher prices. That said, most medical billing services require you to use their PMS (and a few have the same rule about their EMR system). In some cases, migrating your data from your old platform to your new one may incur additional charges.

3. Determine how long setup and implementation will take.

Since you’ll be installing software (unless you are opting to work through your existing software provider for your billing), you’ll need to account for the implementation process in the timeline. Fully setting up the software side of your billing services often takes several weeks to three months. Sometimes, the setup process results in additional fees, though we found that many companies include implementation and training for free.

Check whether your medical billing provider includes free training with your implementation. If it does, chances are you’ll be paired with a dedicated account manager who will help you set it up. You may also get access to setup resources you can browse on your own time.

4. Figure out your support options.

With medical billing services, support isn’t just about phone calls and emails; it’s about having a full, transparent window into your billers’ work at all times. Look for providers whose PMS platforms include a portal where you can see your claims’ real-time status and look over your third-party billers’ work.

On the traditional support side, you should check whether you can reach your provider by phone, email or live chat at all times or just during weekday business hours. The company’s representatives should be happy to assist you and easy to reach.

Your billing service should also provide you with your payers’ electronic remittance advice and explanations of benefits. These documents are important for obtaining a transparent view into your payers’ operations.

5. Consider patient engagement tools.

Medical billing is primarily a payer-facing need, but not entirely. Since most medical billing services require you to use their PMS, they may also manage the patient portal that most PMS platforms include. This means that your billing service can directly send patients their statements and follow up on unpaid charges. Should statements go unpaid long enough, your billing service could even oversee the process of sending patients to collections.

It’s important to find out whether the patient portal will cost your company extra or is included with your billing services. You should also find out how exactly your company of choice pursues unpaid bills and how long it waits to send these bills to collections.

The medical billing industry is projected to see significant growth in the coming years. ReportLinker.com predicts a compound annual growth rate (CAGR) of 11.5 percent for the global medical billing outsourcing market throug h 2026. Additionally, Grand View Research data shows that the market will reach a total value of $30.2 billion by 2030. This puts numbers to the notion that medical practices of all sizes are increasingly outsourcing their revenue cycle management. Doing so eliminates tedious, repetitive tasks for a medical practice and frees up more time for other needs.

Improvements in automation technology have been a significant driver of the outsourced medical billing market’s expansion. This automation can expedite in-house and outsourced billing procedures while minimizing errors. It is increasingly part and parcel of cloud-based medical billing software.

Seamless integrations between medical billing software and a practice’s EMR and PMS are also becoming more common. When medical billing services combine these integrations with automation features, the result is quicker, more accurate claims coding, scrubbing and submission.

Automation is also especially powerful for superbill creation, patient statement generation and claims transmission. Artificial intelligence is a significant driver of automation technology – a recent example worth watching is Outbound AI’s generative AI. Through this tool, which leverages ChatGPT and other AI technologies, billing teams minimize the manual labor of EOB processing, denial management and prior authorizations.

At every step of the way, the software will remain vital to medical billing in 2023. Its importance is only expected to grow as healthcare IT vendors introduce machine learning algorithms into their products. More automation – and more accurate billing – should result.

Present-day medical billing options also come with personalization tools so patients can receive statements and use customized payment collection tools. Patient payment plans are also becoming more common. Outsourced medical billing providers may thus be expected to prioritize a personalized patient billing experience in 2023.

There will likely be a focus on medical billing transparency as well in 2023. State legislation reflects this, such as a new Texas law that requires clear written invoices before sending patients to collections. So too do consumer concerns such as those out of Colorado, where one patient reported a billing error affecting tens of thousands of people. This patient filed a complaint directly with the state government, leading to national reporting on the issue. This suggests a renewed interest in medical billing transparency throughout the country.

Attention on medical billing has also emerged in Minnesota. There, the state Attorney General’s Office is investigating the health systems Mayo Clinic and Allina Health. In particular, Minnesota Attorney General Keith Ellison has been hosting listening sessions to get public input on negative medical billing experiences. As government focus on medical billing expands, prioritizing a highly positive patient experience will become increasingly important in 2023.

Additionally, in 2023, medical practices can expect a stronger focus on the federal No Surprises Act that went into law in 2022. This law protects patients from incurring unexpected medical bills, but many physicians have argued that federal involvement in insurer-practice disputes violates the Act’s guidelines. In fact, between February 2022 and February 2023, two federal district court rulings invalidated certain parts of the Act.

The confusion doesn’t end there. In July 2023, federal executive agencies asked a district court to reverse a previous ruling invalidating part of the Act. Medical practice and billing service requirements may thus fluctuate as courts weigh in on the No Surprises Act or reverse previous rulings. This makes the No Surprises Act key to watch in 2023.