How to Evaluate Medical Billing Services

By Kat Helgeson | Published 9/21/2018 2

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When a medical practice makes the decision to outsource their medical billing, the key priority is to choose a reputable company that they can trust 100% with their patient’s medical information. A physician needs to ensure that they engage a company that will be able to significantly reduce the headaches around billing issues, while at the same time protecting and securing their patient’s private data. A good choice of vendors will allow the physician to spend more time on his patient’s care and fewer hours on time-consuming billing rigmarole.

How do you go about evaluating medical billing services?

The right service should:

  • Be established with verifiable industry experience. It’s not about the number of years in business but rather about areas of specialty. They must have experience as a medical billing service that is able to bill both Medicaid and Medicare.
  • Have staff members on the team that are certified by the American Medical Billing Association (AMBA). This means they have in-depth knowledge of medical technology, ICD-10, CPT4, and HCPCS Coding as well as HIPAA and Office of the Inspector General Compliance – to name a few attributes.
  • Protect patient privacy by being 100% compliant with the Health Insurance Accountability and Portability Act (HIPAA)
  • Have a high level of service excellence. In the service level agreement make sure you are clear on whether the service will follow up on denied claims and unpaid bills.
  • Provide multiple support channels including email, phone, live messaging etc. along with in-person training or webinars to assist the providers’ staff on how to use their medical billing features and how to improve the practice’s revenue cycle.
  • Make use of the latest technology
  • Use a competitive pricing model
  • Not have too many clients on their books. They must have the capacity to execute the demands of your billing cycle timeously.
  • Share data on how to improve the practice. They will have reporting and analysis tools which could be exceptionally helpful to the medical provider. Be sure they are open to sharing their insights.

What functions do you need?

The functions you will need from an experienced medical billing service provider include

  • claim generation and submission
  • insurance carrier follow-up
  • payment adjudication, posting, and processing
  • patient invoicing
  • patient support
  • collection agency transfer services.

These are the core elements of an efficient medical billing services company. The provider should be super efficient in pursuing denied claims. Following up with insurance carriers should also be one of their fundamental strengths.

What other services can vendors provide?

Many medical billing service vendors offer a range of other features including appointment scheduling, insurance eligibility verification, credentialing and medical coding. The more services you chose, the higher the fees. The choice of items must be based on the cost as well as what the physician can realistically execute in-house and what definitely needs to be outsourced to ensure the practice can run seamlessly. There are three price structure possibilities:

  • percentage-based,
  • fee-based
  • hybrid (a combination of percentage and fee-based)

How to measure the performance of outsourced services

Once a provider chooses an outsourced medical billing service, the next step is to measure their performance. After about 4 months on the job, go back and do a charge capture audit on their work to date. Compare the log of your registered patients from all of your locations, and see if all procedures have been accounted for during this time. Doing a spot check is vital to reduce revenue leaking. No-one wants to be completing procedures that never make it into the billing system!

Evaluating accuracy

Another area to evaluate is the medical billing services coding accuracy. Is the company using an auto-coder and how often do they audit their coders? Are all of the physicians using the appropriate codes in the practice to ensure maximum reimbursement (under-coding can lead to noncompliance)? The billing company should be revealing a 95% and upwards accuracy rate (according to Health Management Technology).


It is important to know how your medical billing service monitors underpayment? To make sure a provider is being properly reimbursed, they need to be privy to the payer contracts that have been negotiated. The billing company should be delivering at least 80% of the expected collections every month. That figure is a good indication that their operational process is well oiled. It is essential to know how the vendor manages denials and what process they employ to report them to the provider. The reports the vendor submits should detail denial trends by the denial code. Once these denial reasons have been analyzed they should furnish an improvement plan on how to reduce them. This is the crux of evaluating the medical billing service’s performance.


The medical billing service does all of the heavy lifting of the billing process and can free up a huge amount of the physician’s time that could be better spent by seeing more patients in a day. To make it work, however, if you make the right medical billing vendor choice upfront.

Kat Helgeson


Kat Helgeson comes from a ten-year career in social media marketing and content creation. She takes pride in her ability to communicate the culture and values of an organization via the written word. Kat is also the author of numerous books for young adults. Her titles have received the Junior Library Guild Award, the Bank Street College of Education Best Books of the Year Distinction, and been featured on the Illinois Reads selection list. Her work has been translated into Dutch and German.


  • I have learned a great deal about services through this article. Having been someone that deals with the medical bills, I have always tried to generate the best possible results for my company. This article will only enhance my knowledge concerning this aspect and will evolve me in my professional life.

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