How much does medical billing cost?

The short answer

We charge 5–7% of what we actually collect for you, with a $950 per month floor. Single-specialty practices sit at the 5% end, multi-provider groups at 6%, and behavioral health at 7% because the payer mix and documentation load are heavier.

The floor is not an additional fee. You pay the percentage or $950, whichever is higher — so a practice collecting very little in a given month has a known maximum exposure, and a growing practice never gets penalised for growing.

The question worth answering is not which number is smaller on paper, but which model costs your practice less once everything is counted. That is what the rest of this covers.

Percentage of collections versus a flat fee

A percentage of collections ties what the biller earns to what the practice is actually paid. If a claim is denied and never worked, the biller earns nothing on it. That alignment is the entire argument for the model, and it is a strong one.

A flat fee per provider or per claim is predictable, which some practices prefer, but it pays the same whether the claim is paid in three weeks or written off in six months. In a book of business with a difficult payer mix — AHCCCS, behavioral health, long-term care — that difference compounds quickly.

What in-house billing actually costs

Practices comparing quotes usually compare our percentage against a biller's salary, which understates the in-house cost substantially. The honest comparison is the loaded cost: salary, payroll taxes, benefits, paid leave, recruitment and the cost of the role sitting vacant, software and clearinghouse fees, the manager's time supervising the function, and the space and equipment.

Then add the two costs that never appear in a budget line. Single-point-of-failure risk: when your one biller is on leave or leaves the practice, claims stop going out and A/R ages while you recruit. And coverage depth: one person cannot simultaneously work denials, chase A/R, post payments, verify eligibility and keep credentialing current, so one of those is always being neglected — usually denials, which is the expensive one.

Build the comparison on your own numbers

Take your last twelve months of actual collections — not charges, collections. Apply the percentage that matches your practice type to get the annual outsourced fee. Then build the loaded in-house figure above, honestly, including the vacancy risk.

Now adjust for performance, because this is where the decision is usually made. If outsourcing moves your net collection rate or your denial rate by even a modest amount on the same charge volume, that difference is frequently larger than the entire fee gap between the two models. Run it on your own data rather than on any figure quoted in an article — including ours.

What the percentage covers

Charge entry and claim submission, payment posting and reconciliation, denial management and appeals, A/R follow-up on a timed cadence, eligibility and benefit verification workflow, patient statement support, and monthly reporting on collections, denials by cause, and A/R ageing.

Credentialing and payer enrollment are handled by the same team and quoted separately, because the volume of that work depends on how many providers and panels are involved rather than on what you collect.

Why behavioral health is priced differently

Behavioral health sits at 7% for structural reasons, not as a premium. Service volumes are high and unit values are low, so the claim count per dollar collected is much larger. Authorisation is ongoing rather than episodic, and units have to be tracked to expiry. Staff credentialing and supervision status determine billability and change during employment. Documentation is reviewed closely against the service billed.

That is materially more work per dollar collected, and pricing it the same as a single-specialty clinic would simply mean doing less of it.

The questions to ask any billing company

What exactly is the percentage applied to — collections, or charges? Is there a floor or a minimum, and how does it behave in a slow month? Who works denials, how often, and are they grouped by cause or by age? What reporting will I get, and does it show net collection rate and denials by cause, or only a total? Who owns credentialing and revalidation dates? What happens to my data and my A/R if I leave?

Our answers: collections, not charges. A floor, described above. Denials worked weekly by cause with the top preventable causes reported monthly. Credentialing dates held by us. Thirty days' notice to leave, and your files returned within 5 business days.

Figures in this article are estimates until confirmed in writing

The 5–7% band and the $950 floor are our published rates and they are current. Where your practice lands inside that band depends on specialty, payer mix, provider count and the state of your current A/R, and it is confirmed in writing after a consultation.

If you want the comparison done on real numbers before you commit to anything, the free 90-day A/R and denial audit produces the cause breakdown from your own data.