What Are Medical Billing Services? 10 Things You Need to Know

medical billing services

If you did a survey of medical practices across the country, what do you think would be their least favorite part of their job? The majority of the time it would be the paperwork involved with billing.

Medical insurance has become a permanent part of our society and each insurance company focuses on different things. This adds to the difficulty that each practice deals with when it comes to billing.


This is why so many practices are working with outside medical billing services. There are a lot of great benefits to hiring a medical billing service including a decrease in denials and other errors.

They can also help you free up your time for patient care and revenue management. Keep reading below to learn 10 things you need to know about working with outsourced medical billing.

1. The Growing Medical Billing Services Industry

In 2020, outsourcing medical billing services was an industry worth over 10 billion dollars. This industry is expected to grow almost 13% each year through 2028.

The complex nature of billing and dealing with different insurance companies has hurt many local practices. They are having a hard time keeping up with the constant changes in procedures and coding.

This is why so many practices, large and small, are switching to an off-site medical billing service. They are finding the expertise of an outside service frees them up to focus on patients better.

Some services will also provide medical billing software to help with the process. Many small practices will start with the software and then move to more outside services as they grow.

This saves them money during the early days of building a practice up in a new community.

2. How Off-site Medical Billing Works

The majority of patients have some type of medical insurance. Their medical claims have to be processed according to each insurance company’s policies. Off-site services can often do this processing faster than a local practice.

Many practices have one person who has to handle the coding and the processing. This can get overwhelming with all the other things that need taking care of in the everyday busyness of the practice.

Medical billing services take care of all the details of connecting with insurance companies and making claims. They will file your claims quickly so you don’t have to wait as long for your payment.

3. HIPPA and Medical Billing Services

Using a service for medical claims will still fulfill your HIPPA requirements. Billing services should have HIPPA qualifications and have the authority to handle your medical claims.

In fact, most billing services stay up to date with the latest regulations for HIPPA compliance. This can help your practice because they will make sure that all your filings are up to date and in compliance.

Ask any medical billing service you are looking at how they stay current with HIPPA. With HIPPA being standard in the medical industry, showing you how they stay current should be a simple process.

You can also use medical practice software that takes care of all your information in HIPPA-compliant ways. This software will often work with any outside billing service in a simple way.


4. Costs for Medical Claims Billing Services

There are different pricing structures out there for medical billing services. Many billing services will charge a percentage based on your collections. This can vary from 3% to 10%.

They will also have a base rate in case your collections aren’t enough in one month to meet their base price.

Other billing services charge a flat fee per month. This is a fixed rate that can be based on a per claim basis or the main fee no matter how many claims are filed.

As with any service, there are many variations in pricing based on the services provided. You want to be cautious about a service that is cheaper because it may not provide all the things you need.

5. Your Staff’s Responsibilities

You want to be clear with any off-site service you are looking at what they do and what your staff does. Make sure that your medical coder is providing the information they need at the beginning so problems won’t develop.

Medical Bill Invoice

The biggest issue to take care of upfront is the deductible or the per visit charge. You want your staff to get that before the appointment and not expect to get it later.

Patients often have to be reminded about what their copay is and when it is due. You can’t expect a medical billing service to handle that because that should be your staff’s responsibility.

6. Your Transparency Needs

Make sure to find out how transparent a potential medical billing service is. Do they have a way for you to sign in and get a current update on your claims?

Many services will give you your own unique username and password to access your information in their system.

This helps you stay up to date with your finances so you can know what expectations to have. They can give you up-to-date statistics on what money is coming in from different insurance companies.

They can also show you any problems you are having with specific insurance companies. This can help you make sure you are collecting all data in the way the company wants it.

7. Your Communication Needs

Every medical office has its own way of dealing with medical insurance that is unique to them. Different staff members communicate in different ways. You want to check with a potential service to see how they communicate.

You want to make sure they will work with the processes you use for your office. Your office may need to change some things, but you don’t want to have to change everything.

Each medical billing service should tell you how they handle their regular communication with the practices. This is important in cases such as you getting reimbursed at a lower percentage than you should be getting.

You don’t want to find out those important details weeks after they happen when collecting from a company is out of date.

8. The Claim Denial Process

Buyers GuideThe most complicated part of the medical insurance industry is managing claim denials. This can come in the form of outright denials and rejections, or claims that are underpaid.

You want to find out from any potential billing service how they handle insurance industry denials. Find out their average denial rate and what they do to identify and fix claim errors that appear.

One of the best things to do is see what steps they have in place to prevent denials from the beginning. Does their input program automatically check what your medical coder is putting in to catch simple mistakes?

Find out their process for generating reports that show how they are dealing with your denials. You want easy-to-understand reports that reveal any problems with denials before they get out of hand and hurt your revenue.

9. Their Training Plan

With the healthcare industry’s growth, medical billing services are offering more benefits to win your business. Some of them are providing training that can help your staff do their job better and help them collect easier.

Your front office staff can be trained on how to ask for copays and deductibles in a friendly way. They can also be trained on how to explain insurance in an easy way for your patients to understand.

Your staff can learn how to double-check all demographic information from patients. This helps stop small errors that can delay payment on medical claims.

10. Check Their References

The medical billing services industry is growing so any company you are looking at should have references you can check. Ask them to provide you with references from practices that are similar in size to yours.

Checking references is something you can do but also let your staff participate. Let them talk to the person who does their job at the practice. This will give you a well-rounded reference instead of just one person’s opinion.

The Perfect Medical Billing Service for You

With the many medical billing services out there, you can take your time finding the right fit for you. Talk with your staff about what are the most important services your practice needs.

Empowering them to help you with comparison shopping for billing services can help you find the perfect one for your practice.

Price It Here can start the process for you when it comes to finding the right medical billing service. Check out our comparison of Medical Billing Services in 2022. We do the hard work of comparing so you can find the right one for you.