Should a Small Group Practice Outsource Billing?
In-house vs outsourced billing for therapy and behavioral health group practices
When a solo therapy practice grows into a group, billing tends to grow from a few hours a week into a real job. More clinicians means more payers, more credentialing, more authorizations and more claims to follow up. At some point every practice owner asks: should we hire someone to do this in-house, or outsource it to a billing company?
There's no single right answer. This guide sets out the trade-offs so you can decide what fits your practice.
What "billing" actually includes
Before comparing options, it helps to be clear about the work itself. Insurance billing for a therapy practice usually includes:
- eligibility and benefits verification
- tracking prior authorizations
- creating and submitting claims
- checking clearinghouse rejections and fixing them
- posting payments and reconciling remittances
- working denials: correcting, resubmitting and appealing
- following up on claims with no response
- patient statements and balances
- reporting on what has been billed, paid, denied and is still outstanding
Some practices also need credentialing help when they add clinicians. When people say billing "isn't working", usually one or two of these steps, often denial follow-up and A/R follow-up, aren't getting done consistently.
The case for keeping billing in-house
Control and proximity. An in-house biller sits with your team, knows your clinicians and can fix scheduling or documentation problems on the spot.
Immediate answers. Front-desk staff and clients can get billing questions answered quickly.
Works well when you have the right person. If you already have an experienced biller who knows behavioral health payers, keeping them may be the best option.
The downsides: - Single point of failure. If your one biller is sick, on vacation or leaves, billing stops, and A/R grows quickly. - Hiring and training. Behavioral health billing has its own codes, payer rules and authorization patterns. Finding and training someone takes time. - Fixed cost. Salary, benefits, software and management time are fixed whether collections go up or down. - Competing priorities. In small practices the "biller" is often also the office manager, so follow-up gets squeezed out by everything else.
The case for outsourcing
Coverage and consistency. A billing company can keep work moving when one person is out, because the process doesn't rely on a single employee.
Variable cost. Many billing companies charge a percentage of what they collect, so cost rises and falls with revenue rather than being a fixed salary.
Aligned incentives. Under a percentage-of-collections model, the billing company only earns when your practice gets paid, which encourages them to follow up on denials and unpaid claims.
Time back for the owner. Owners who are also clinicians often do billing in the evenings. Outsourcing can give that time back.
The downsides: - Less direct oversight. You need clear reporting to know what's happening. - Communication gaps. If questions go unanswered or responsibilities are vague, issues can fall between the practice and the billing company. - Fit matters. A company that mainly bills for other specialties may not know behavioral health payer rules. - Data security. A billing company handles protected health information, so a Business Associate Agreement under HIPAA is required.
Signs it may be time to outsource
- Your A/R has claims older than 90 days that nobody is working.
- Denials are written off rather than appealed.
- The owner or a clinician is doing billing after hours.
- You've added clinicians and billing hasn't kept up.
- You don't have a clear monthly picture of what is billed, paid and outstanding.
- Your in-house biller has left, or is about to.
A middle path
Outsourcing doesn't have to be all or nothing. Some practices keep front-end work in-house, such as eligibility checks and collecting copays, and outsource claims, denials and A/R follow-up. Others start by outsourcing just the backlog of old unpaid claims to see how a billing company works before handing over ongoing billing.
Questions to ask any billing company
- Do you work with therapy and behavioral health practices? Ask which codes, payers and EHRs they're familiar with.
- How do you charge? Is it a percentage of collections, a flat fee or per claim? What is and isn't included?
- What reporting will we receive, and how often? You should see claims billed, payments, denials and open A/R.
- How quickly do you submit claims and work denials?
- Who is our point of contact, and how fast do you respond?
- Will you sign a Business Associate Agreement before accessing patient data? The answer must be yes.
- Do we keep ownership of our data and access to our systems?
- What are the contract terms and notice period?
Clear, specific answers to these questions are usually a good sign.
Making the decision
If you have a strong in-house biller and A/R is under control, there may be no reason to change. If follow-up is slipping, old claims are piling up or billing depends on one overloaded person, outsourcing is worth a serious look, even if it starts small.
How MedBill Solutions can help
MedBill Solutions LLC provides billing support to US therapy and behavioral health practices: claims submission, claims tracking, denial follow-up, payment posting, payer follow-up and reporting. Ongoing billing starts at 3% of what we collect for you. If you want to test us first, we'll work your old unpaid claims and you only pay 3% of what we recover. We sign a BAA before touching any patient information.
Get your old claims reviewed → or request an introductory conversation.
This article is general information, not legal, financial or compliance advice.
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