How much does outsourced medical billing cost?

Outsourced medical billing typically costs 4–10% of monthly collections, though percentages vary by specialty, claim complexity, and volume. Some vendors offer flat per-claim or per-provider fees instead. MB Claims structures fees around your practice size and payer mix, with transparent pricing and no hidden charges.

What factors determine the percentage you pay?

Percentage rates depend on your specialty, average reimbursement per claim, claim volume, and payer mix. Practices with higher claim values—such as surgical or imaging centers—often pay lower percentages because each dollar billed generates more absolute revenue for the vendor. Primary care or behavioral health practices, where claims may be lower-value, tend to see higher percentage rates.

Claim complexity also matters. If your practice handles multiple payers, frequent prior authorizations, or high denial rates, expect pricing at the higher end. Conversely, high-volume practices with straightforward commercial payers may negotiate lower rates.

Finally, the scope of service affects cost. A vendor that only submits claims will charge less than one providing full revenue cycle management—eligibility checks, coding audits, denial appeals, and credentialing.

How does percentage-based billing work in practice?

The vendor calculates their fee as a percentage of what you collect each month, not what you charge. This model aligns the vendor's incentive with yours: they earn more when you collect more. It also means your billing expense scales with revenue—helpful during seasonal dips or new-practice ramp-up. You pay nothing on denied or uncollected claims, so the fee is tied directly to actual cash flow.

Most vendors invoice monthly, deducting the fee directly from collections or sending a separate invoice. Contracts should clarify whether the percentage applies to gross collections or net (after refunds and adjustments). Ask for sample invoices and confirm how refunds, patient payments, and adjustments are handled in the calculation.

When does a flat-fee or per-claim model make sense?

Flat-fee pricing works well for high-volume, low-complexity practices or those with very high per-claim reimbursements. Some vendors charge a per-claim fee submitted, regardless of reimbursement amount. This can benefit practices that bill thousands of similar-procedure claims monthly—urgent care, labs, infusion centers—and want predictable costs. Others offer per-provider monthly fees, which can be attractive to small practices with stable patient volume.

The trade-off: flat fees don't automatically scale down if collections drop, and they may not include denial appeals or AR follow-up. Compare the total annual cost under each model before signing, and confirm exactly which services are bundled versus billed separately.

What services should be included in the base fee?

At minimum, expect charge entry, claim submission, payment posting, and basic denial follow-up. A transparent contract will itemize eligibility and benefits verification, coding review or full coding support, electronic claim submission, payment posting and EOB reconciliation, first-level denial appeals and AR follow-up, and monthly reporting on aging, KPIs, and payer performance.

Watch for à la carte fees: some vendors charge extra for credentialing, patient statements, or prior authorization calls. Others bundle everything. Clearinghouse costs may be included or passed through separately. Ask for a sample invoice and a clear schedule of any additional fees before you commit.

How MB Claims handles this

MB Claims tailors pricing to your practice's specialty, volume, and service scope, delivering full revenue cycle management without surprise charges. During your free A/R audit, the MB Claims team reviews your payer mix, current clean claim rate, and denial patterns to recommend a transparent fee structure—typically percentage-based for alignment with your revenue goals. The base package includes eligibility checks, coding support, claim submission, payment posting, denial management, and monthly performance dashboards. Credentialing and provider enrollment are scoped separately when needed. You'll receive a detailed service agreement that lists exactly what's included, so you know your total cost from day one.

Frequently asked questions

Are clearinghouse fees included in the percentage?

It depends. Some vendors bundle clearinghouse costs into the base percentage; others pass them through as a separate monthly charge. The amount varies by clearinghouse and claim volume. Always ask before signing.

Do I pay the billing company on denied claims?

No. Under percentage-based pricing, you pay only on what you collect. If a claim is denied and never paid, the vendor earns nothing on that claim. This aligns their work with your cash flow.

Can I negotiate a lower percentage?

Yes, especially if you have high volume, straightforward payer mix, or are willing to commit to a longer contract term. Bring your current claim metrics and collection data to the conversation.

What happens if my collections drop one month?

Your billing fee drops proportionally under a percentage model. Fixed-fee contracts do not adjust, so percentage pricing offers more flexibility during slow months or seasonal changes in patient volume.

Should I pay setup or onboarding fees?

Some vendors charge for initial data migration, clearinghouse setup, and staff training. Others waive setup fees in exchange for a longer contract. Confirm this upfront and get the total first-year cost in writing.

MB Claims · www.mbclaims.com · (888) 603-5358

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