ORTHOPEDIC GROUP
Before59
After35
Cash in 24 fewer days
California, 2025: days in AR fell from 59 to 35 within 45 days of go-live.
Read the case study →Medical specialties
Primary and family care
Surgical and procedural
Dental, DME and labs
Revenue cycle · one rate
Front end · before the visit
Patients, insight and growth
Clinical documentation
Revenue operations
Voice automation
Medical billing outsourcing · Outsourced billing services
By Sam, CPC · Reviewed by Harpreet, CPC · Updated Nov 7, 2026
PhysiAssist Health takes over coding, claim submission, payment posting, denials and AR follow-up for US practices, for 2.8% to 5% of net collections, with no setup fees and no minimums. Below you can compare that with what billing in-house really costs, see the risks worth checking before you sign, and how practices switch in 2 to 4 weeks.
Family medicine, $90,000 a month in net collections ($1.08M a year)
About $67,600 a year lower in this example. See the math →
Wages from BLS (May 2025), benefits from BLS (June 2026). Change every input in the calculator.
The basics
Medical billing outsourcing means a practice hands the work of turning visits into payments to an outside billing company, also called a third-party medical biller, instead of employing its own billing staff. The outsourced team codes or reviews the charges, submits clean claims, posts payments, works denials and follows up on unpaid claims, usually inside the practice's own EHR and practice management system. Most outsourced medical billing services charge a percentage of what they collect, so the cost rises and falls with revenue instead of being a fixed payroll line.
STEP 1
Your providers document and close the visit in your EHR, as they do today.
STEP 2
Certified coders assign CPT, ICD-10 and modifiers; claims are scrubbed and sent through the clearinghouse.
STEP 3
Payer payments land in your bank account (a few payers still mail checks to your practice); we post ERAs and EOBs and reconcile them to deposits.
STEP 4
Every denial is fixed at its cause and every open claim is followed up until it is paid or closed.
What you hand over
The rate pays for the work from coding to collection. Front-desk work and other services are optional and quoted separately, so you only pay for what you hand over. Full list on the pricing page →
Calculator
Move the sliders to match your practice. Wages default to the US median for medical records specialists, and benefits use the national private-industry ratio, so the in-house figure is a fair floor, not a worst case.
Yearly cost of billing in-house
$116,196
10.8% of collections
Yearly cost of outsourcing
$48,600
Below the break-even, outsourcing at this rate costs less than this staff level. Above it, the deciding factors are results: denial rate, days in AR and what is collected.
An estimate to compare options, not a quote. It leaves out revenue gained or lost through denials and slow follow-up, which often matters more than the fee.
Worked example
A family medicine practice with three providers collects $90,000 a month, or $1.08 million a year. One full-time biller handles claims and posting, and a part-time colleague spends half her week on denials and AR calls.
| Cost line (per year) | Billing in-house | Outsourced to PhysiAssist |
|---|---|---|
| Billing wages | 1.5 FTE × $51,140 = $76,710 | $0 |
| Benefits and payroll costs | 42.9% of wages = $32,886 | $0 |
| Clearinghouse and billing tools | $300 × 12 = $3,600 | Included |
| Training, coding updates, cover for leave | $3,000 | Included |
| Billing fee | None | 4.5% × $1,080,000 = $48,600 |
| Total | $116,196 (10.8% of collections) | $48,600 (4.5% of collections) |
Side by side
Cost is only one row. The rest decide whether the money actually comes in.
| In-house billing team | Outsourced medical billing | |
|---|---|---|
| How you pay | Fixed wages, benefits and tools, whether collections rise or fall | A percentage of net collections, so cost moves with revenue |
| Staffing risk | One resignation or long leave can stop claims and follow-up | A team covers the work; no single person holds your cash flow |
| Specialty knowledge | Depends on who you can hire and keep | Certified coders who bill your specialty every day |
| Denials | Often reworked one by one when time allows | Tracked by payer and root cause, fixed upstream |
| Control and visibility | Full and immediate | Work happens in your systems, with claim status and KPIs you can check |
| Payer and coding updates | Your staff keeps up on their own time | Part of the service |
| Growth | Hire and train before adding providers | Capacity grows with your volume |
Benefits
The reasons practices outsource, and what each one looks like in numbers you can check.
The fee replaces wages, benefits, billing tools and training, and it falls when collections fall. In the worked example above, that is 4.5% of collections instead of 10.8%.
Claims keep going out through resignations, vacations and sick leave, because a team, not one biller, owns your account.
41% of providers report denial rates of 10% or more (Experian Health, State of Claims 2025). A team that tracks every denial by payer and cause can stop the repeats instead of reworking them.
An orthopedic group in California cut days in AR from 59 to 35 within 45 days of handing over its revenue cycle. Case study →
A psychiatry clinic in Massachusetts recovered $1M of backlog in 75 days, and days in AR fell from over 90 to under 40. Case study →
Managers stop chasing claims and covering the billing desk, and providers get questions only when a chart truly needs them.
Pros and cons
Outsourcing goes wrong in predictable ways. Each risk below has a safeguard you can put in the contract.
| Risk | What goes wrong | Safeguard to ask for |
|---|---|---|
| Losing control | You stop knowing which claims are unpaid and why | Work done in your EHR and practice management system, with claim-level status you can see any time |
| Hidden fees | Setup, per-statement, appeal or software charges appear after signing | A written list of what the percentage covers and what is extra. PhysiAssist charges no setup fees and has no minimums |
| Payment handling | Payer money flows through the vendor | Payments go to your bank account, or by check to your practice, never to the vendor. Medicare only pays a billing agent whose pay is not tied to amounts billed or collected (42 CFR 424.73(b)), so percentage-priced vendors should never receive your payments |
| Upcoding exposure | Coders rewarded for higher-paying codes | Coders paid for accuracy, not dollars, and regular audits. The OIG has warned that percentage arrangements can raise the risk of upcoding (Compliance Program Guidance for Third-Party Medical Billing Companies, 1998) |
| Data security | Patient data copied to vendor laptops or unknown systems | A business associate agreement, a named security standard such as ISO 27001, and no local downloads of PHI |
| Lock-in | Hard to leave, or your data is held back | Your data stays in your systems, with exit terms and data return written into the agreement |
| Transition gap | Old claims go unworked while the new team starts | Old AR worked in parallel, and every claim filed on time (Medicare's limit is 12 months from the date of service, 42 CFR 424.44) |
Onshore, offshore or blended
Many outsourced billing companies, including PhysiAssist, use teams in more than one country. What protects you is not where people sit but how they reach your data and who is accountable for the work.
Same time zone and the highest labor cost. Usually priced at the top of the market, which suits practices with contracts that require onshore access to patient data.
Lower cost and work that continues overnight. The risks are data handling, communication and accountability, so check how PHI is accessed and who you call when something breaks.
US headquarters in Sheridan, Wyoming, with team offices in Mohali, India and Abbotsford, Canada. Everyone works inside your systems or our Microsoft Azure environment, no PHI is downloaded to a local device, and we are ISO 27001 certified with a BAA for every client. Trust center →
Check your payer and state Medicaid contracts before you sign: some limit where patient data can be accessed from.
Choosing a partner
Ask every company on your shortlist the same questions, and get the answers in writing.
Specialty checklists: behavioral health · oncology · gastroenterology · physical therapy · pain management · urology
By specialty
A billing company that is good at primary care can still lose money on oncology drugs or therapy units. This is what we check for in each field.
| Specialty | Where outsourced billing usually goes wrong | Learn more |
|---|---|---|
| Oncology and hematology | Drug units, J-codes, JW/JZ waste modifiers and authorizations for every regimen | Oncology billing · JW/JZ guide · How to choose |
| Behavioral health and psychiatry | Time-based psychotherapy codes, add-ons with E/M, and payer carve-outs | Behavioral health billing · Add-on codes · How to choose |
| Cardiology | Professional and technical splits (modifiers 26 and TC), imaging authorizations, stress tests | Cardiology billing · Stress test codes |
| Gastroenterology | Screening colonoscopies that become diagnostic, and modifiers PT and 33 | GI billing · Colonoscopy billing · How to choose |
| Pain management | Injection codes, imaging guidance bundling and global periods | Pain management billing · ESI codes |
| Physical therapy | 8-minute rule units, GP and KX modifiers, therapy thresholds | PT billing · 8-minute rule |
| Urology | Screening versus diagnostic PSA, in-office procedures and drugs | Urology billing · PSA billing |
| DME suppliers | Certificates of medical necessity, supplier modifiers and documentation audits | DME billing · How to bill DME |
| Laboratories | Medical necessity edits, panel versus single test billing, and payer test limits | Lab billing |
| Primary care and internal medicine | High E/M volume, preventive visits and chronic care codes billed in the same encounter | Primary care · Internal medicine |
Also: neurology · orthopedics · rheumatology · ophthalmology · OB-GYN · pediatrics · ASCs · all specialties
Switching
Whether you are moving from an in-house team or another billing company, claims keep going out and old AR keeps getting worked.
Business associate agreement, access to your EHR and practice management system, provider and payer list, fee schedules.
Payer-specific scrubber rules, coding guidelines for your specialty, enrollment checks, and a list of claims nearing filing limits.
New claims are coded and submitted by our team, with daily check-ins until the queue is steady.
Open balances are worked by age, oldest and largest first, so nothing passes its filing limit during the move.
Your billing staff do not have to leave. Many practices move them to front-desk, eligibility or patient-balance work, which outsourcing does not replace.
Pricing
Our rate is 2.8% to 5% of net collections. Five things decide where you land. Answer them to see your likely range; your exact rate comes in writing after the assessment.
Your likely rate
3.0% – 4.0%
of net collections
Mid-size practice with full RCM. Collections volume and specialty move this range the most.
An estimate, not a quote. Your rate is confirmed in writing before you sign.
Results
Free assessment
Send us your AR aging and a recent denial summary. A specialist in your field reviews them and sends a written report you keep, whether or not you work with us.
The systems we work in every day
We log in to your system; nothing about it changes for your team.
Claims, rejections and remittances worked through your clearinghouse.
Submissions, status checks and renewals in each payer's own portal.
Most outsourced medical billing services charge a percentage of collections; some charge per claim, a flat monthly fee or for dedicated staff. PhysiAssist charges 2.8% to 5% of net collections, with no setup fees and no minimums. Compare that with your full in-house cost, including benefits and billing tools, using the calculator on this page.
Usually, because a small practice pays for a full biller's wages and benefits but has no backup when that person leaves. In the worked example, a three-provider practice collecting $90,000 a month pays about $116,000 a year to bill in-house and $48,600 to outsource at 4.5%.
The pros are lower and variable cost, no single point of failure, specialty coding knowledge, fewer repeat denials and faster cash. The cons are less day-to-day control, possible hidden fees, data-security exposure and the effort of switching. Each con has a contract safeguard, listed in the risks table above.
It is another name for outsourced medical billing: an outside company, the third party, prepares and submits claims, posts payments and follows up with payers on the practice's behalf. The practice remains the billing provider, and payer payments should still go to the practice's own account.
Not if the work happens in your own EHR and practice management system and you can see each claim's status. Write-off rules, payment plans and fee schedules remain your decisions; the outsourced team carries them out and reports on them.
It can be. HIPAA does not ban offshore work, but the vendor must sign a business associate agreement and protect patient data wherever its team sits. Ask how data is accessed, whether anything is downloaded, and which security standard the company is certified to. Check your payer contracts too, since some restrict offshore access.
Many practices keep them and move them to front-desk, eligibility, copay collection or patient-balance work, which outsourcing does not replace. Others reduce billing hours over time as staff leave.
Keep the old AR being worked while new claims start with the new team, and list every claim close to its filing limit before the switch. With PhysiAssist, claims start going out 2 to 4 weeks after the agreement is signed.
No. There are no setup fees and no minimums. You pay a percentage of net collections between 2.8% and 5%, confirmed in writing before you sign.
Specialty practices, ASCs and groups across oncology, behavioral health, cardiology, gastroenterology, pain management, physical therapy, DME and more, working in systems such as Epic, athenahealth, eClinicalWorks, NextGen, AdvancedMD and OncoEMR.
Related guides: Clean claim rate: formula and benchmarks · How to calculate days in AR · AR days calculator
Sources
Send your AR aging and a denial summary. We compare your in-house cost with outsourcing and send your rate within 2.8% to 5%.