How Do Medical Billing Services Work?

    Stethoscope on medical billing statement on table, all text is anonymous

    While consolidation in medicine has reduced the number of private medical practices in the US, there are still thousands of doctors working in private practice. Like any other small business, running a private practice means you put in a lot of hours. Odds are good you spend a lot of those hours on medical administration tasks rather than patient care.

    One of the biggest offenders for soaking up valuable hours in a private practice: billing. Medical billing is complex, and you likely struggle to find properly trained billing staff. That’s why many physicians turn to medical billing services.

    Not clear on exactly what medical billing companies do or can do for you? Keep reading.

    Core Activities

    The primary activities that medical billing companies take on for you are processing and submitting claims to insurance companies. This is often a stumbling block for private practices. Insurance companies often create minor differences in their policies that can mean identical claims will get accepted by one insurer and rejected by another.

    Using a billing service offloads the process of managing that entire headache onto someone else’s plate. These services will typically follow up on rejected claims and handle direct billing with patients.

    Secondary Services

    Some medical billing companies also provide beneficial secondary services. How much time do you and your staff spend on medical coding in claims? Some companies, such as this medical billing services company, provide a medical coding service in addition to medical billing.

    Other common secondary services include revenue cycle analysis management, appointment setting, authorizations, and eligibility verification. Depending on your practice’s needs, you may want some or all of these tasks handed off of your plate.


    There is a lot of variation in how medical billing companies charge for their services.

    Some companies simply charge based on the total number of claims they handle. Other companies set up a recurring flat rate. You may see some ask for a percentage of claims collected or a combination of these options.

    The addition of secondary services can also alter the total costs you’ll pay.


    Outsourcing your medical billing gets you a number of key benefits. One of the biggest benefits is more time to spend on actual medical care or business building. Every hour you don’t spend on billing is an hour you can devote somewhere else.

    You will typically see fewer errors, improved revenue, and even lower per-patient costs.

    Medical Billing and Your Practice

    Outsourcing your medical billing can feel a little unnatural at first. It’s a major component of your business.

    Yet, it’s also a component that many doctors and their employees loathe. It’s easy for mistakes to creep in, which makes it even more of a headache and drives up per-patient costs.

    Handing medical billing off can actually reduce errors, which helps boost profits. It also leaves you and your staff free for more patient care and building up your practice.

    Looking for more business finance tips? Check out the Finance posts over in our Business section.

    (Visited 1 times, 1 visits today)


    Please enter your comment!
    Please enter your name here