Did you know that a 2024 MGMA Stat poll has found that over one-third (36%) of medical practices consider outsourcing or automating parts of their revenue cycle management?
That’s because submitting clean claims on time, reducing denials, and staying compliant with ever-changing regulations feels nearly impossible for one practice to do in a single billing cycle. But if you outsource, it doesn’t have to be.
When you need a helping hand in your revenue cycle management, 5 Star Billing is the ideal partner for outsourced medical billing services. We bring the expertise, tools, and a team that knows the ins and outs of RCM to help you get paid faster, compliant, and breathe a little easier.
Reclaim Your Time Spent on RCM
Why Are More Practices Outsourcing Medical Billing in 2025?
Most practices follow a similar pattern regarding why they would prefer to outsource medical billing solutions. Some of these are:
- Reimbursement Models are Getting More Complex
The shift to value-based care comes with new billing codes, reporting requirements, and quality metrics.
- CMS & Payers Keep Changing the Rules
New CMS guidelines, prior authorization rules, and payer-specific billing quirks make it tough for in-house teams to stay current and costly if you fall behind.
- Billing Talent is in Short Supply
There is an ongoing shortage of medical practice staff, among which medical coders are the most difficult to hire. Outsourcing gives you access to an entire team of experienced professionals for less than the cost of hiring in-house.
- Tech Compatibility Issues
Your medical billing and coding services need to work seamlessly with your EHR, practice management system, clearinghouse, and more.
What Do I Get Out of Outsourcing My Medical Billing?
You might find yourself asking, “What’s in it for me?” Here are the several benefits of outsourcing medical billing:
- Cost Efficiency
Outsourcing eliminates the cost of hiring, training, salaries, and software licenses while giving you access to full-service billing pros at a fraction of the cost. - Improved Revenue Cycle Management
Outsourced billing and coding teams know how to move claims through the pipeline. With fewer rejections, quicker reimbursement, and better follow-ups, you’ll see more cash flow and less backlog. - Scalability & Flexibility
No need to hire or train new staff whether you’re expanding or adding new providers; your outsourced billing partner scales right alongside your growth. - Regulatory Compliance
A good billing company stays on top of ever-evolving HIPAA, MACRA, and CMS policies so you stay compliant and audit-ready. - Actionable Analytics
Outsourcing gives you access to clear, customized reports and insights that help you make smarter decisions.
Cost Breakdown: What Are You Paying For?
Outsourcing your billing isn’t free, but when you break it down, it’s often more cost-effective.
Outsourcing Pricing Models
| Model | How It Works | Best For |
| Percentage-Based | You pay % of collections (typically 4-9%) | Most common; scales with revenue |
| Flat-fee | A fixed monthly rate, regardless of how much you collect | Predictable expenses; smaller, steady-volume practices |
| Hybrid | A mix of flat-rate base + % over a certain collection threshold | Practices that want a safety net + performance incentive |
What’s Typically Included in That Fee?
When done right, outsourced billing is an all-in-one service that often includes:
✔ Claim creation and electronic submissions
✔ Payment posting and adjustments
✔ Denial and rejection management
✔ Appeals and follow-ups
✔ Patient billing and support
✔ Insurance verification
✔ Monthly reporting and analytics
Hidden Costs to Watch Out For
While reputable billing companies are upfront about their pricing, here are a few things to ask before signing:
- Transition/onboarding fees
- Software or tech integration changes
- Extra fees for certain specialties or services
- Limited support or hidden miscellaneous expenses that add up over time
In-House vs. Outsourced Medical Billing
| Expense Category | In-House Team | Outsourced Billing Partner |
| Staffing Costs | Salary, benefits, PTO, training | Included in % or flat fee |
| Software & Licenses | EHR/PM billing modules, clearinghouse fees | Usually included |
| Ongoing Training | You’re responsible for training | Handled by the billing company |
| Turnover/Backups | Can cause major delays if not done right | Handled seamlessly |
| Scalability | Involves hiring more staff | Adds support but without the hassle |
What To Expect When You Outsource
If you do take the leap, here’s what your journey would look like:
- Onboarding Process
Once you sign on, most billing companies start with:
- A kickoff meeting to align on goals and timelines
- A detailed review of your current billing processes
- Data migration, credentialing checks, and software setup
- Staff training (if needed)
- Communication Protocols
Your billing partner keeps you in the loop with:
- Regular check-ins (weekly or monthly)
- Real-time updates on claim status and denials
- A dedicated account manager you can reach when needed
- Turnaround Times & Benchmarks
Clear expectations are everything. Here’s what you can typically expect:
- Claims submitted within 24–48 hours of receiving documentation
- Denials worked within 1–3 business days
- Daily or weekly reporting on collections, AR, and performance
- Ongoing reviews to track KPIs and fine-tune results
- Customization
Most partners will offer:
- Specialty-specific billing protocols
- Custom reports and dashboards
- Tailored workflows for pre-authorizations, patient payments, etc.
- Technology Stack
A seamless tech experience is part of the package:
- EHR and practice management system integration
- Secure data handling and HIPAA compliance
- Cloud-based portals for transparency and access
- Optional patient portals or online bill pay features
When NOT to Outsource
Outsourcing is powerful, but it’s not for everyone.
Use this checklist to see if it might be too soon to outsource:
✔ You have a very low patient volume or only bill a few payers with straightforward codes.
✔ Your billing process is simple and handled efficiently in-house with minimal issues or denials.
✔ Your current team doesn’t have the capacity to manage a billing partner.
✔ Your EHR or PM system isn’t ready for integration or secure data sharing.
✔ There are unresolved leadership or ownership disagreements about outsourcing (internal buy-in is critical).
✔ You’re still ironing out workflows or switching systems internally, and adding an outside vendor would cause more confusion than clarity.
If you checked one or more of these boxes, don’t worry. Once your practice is stable, aligned, and ready to scale, outsourcing will make much more sense—and be more effective.
The 5-Star Recipe to Your Practice’s Financial Prosperity
Every practice’s path to financial success is unique, but it helps to have an expert partner you can trust.
Let 5 Star Billing be the co-pilot in handling your financials. Our name reflects our commitment to five-star service across every aspect of your revenue cycle by bringing our specialty to the table:
- Full-Service Revenue Cycle Management
From claims submission to follow-ups and appeals, we handle it all.
- Specialty-Specific Billing Expertise
We take the time to meticulously know your codes, payers, and common denial traps.
- Customizable Reporting Dashboards
Stay in control with performance insights that give a complete picture of how your practice is performing.
- Dedicated Account Managers
Stay informed with a dedicated account manager who doesn’t sugarcoat, just honest, accurate reporting and clear communication.
If you’re ready to stop stressing over rejections, chasing payments, or drowning in compliance updates—let’s talk. You take care of patients. We’ll take care of the billing.
One Conversation Could Change Your Bottom Line
Frequently Asked Questions
How secure is patient data if I use 5 Star Billing’s outsourcing services?
Data security is our non-negotiable priority. Moreover, we are fully HIPAA-compliant and implement strict safeguards to protect your information at every stage of the billing process. Our systems are encrypted, access-controlled, and regularly audited to meet the highest standards of cybersecurity.
What should I look for when choosing a medical billing service provider?
Look for a team that offers transparency, specialty-specific experience, customizable solutions, and great communication. Don’t be afraid to ask about reporting tools, compliance measures, integration support, and turnaround times. And, of course, steer clear of vague pricing and cookie-cutter packages.
What types of healthcare practices benefit most from outsourcing billing?
Practices that are growing, short on billing staff, struggling with claim denials, or overwhelmed by payer rules often see the biggest benefits. That includes specialties like podiatry, behavioral health, allergy, pain management, and more.
How do outsourced billing services integrate with my current EHR system?
The best billing companies work with your existing systems or use secure, bidirectional interfaces to sync data. This means:
- Custom reports and dashboards tailored to your EHR to give you full visibility into financial performance.
- We access your system securely to review patient encounters, verify coding, and submit claims directly.
- No double data entry. We work with what’s already in your system to minimize errors and save time.
- Real-time updates to track the status of your claims, denials, and payments.