If you’re already outsourcing medical billing services and starting to doubt your current provider, switching companies doesn’t have to mean sacrificing the revenue or the reputation with patients you’ve worked so hard to earn. But the biggest risk in this process comes from a poorly sequenced transition.

A clean transition means properly confirming who’s responsible for your old accounts receivable. You’ll also need to move your data and compliance paperwork correctly, and give the new company a thorough handover before your old one steps away.

You’re not alone in considering this move. A Medical Group Management Association (MGMA) poll found that 36% of medical practice leaders planned to outsource or automate parts of their revenue cycle management, with billing as the most commonly cited area.

In this guide, we explain the key steps for making this switch as smooth as possible with a specialized medical billing and coding company.

Why Switching Feels Riskier Than Outsourcing Medical Billing 

Outsourcing medical billing to a new company isn’t the biggest fear most practices have. Something much more challenging is the gap between vendors, where claims remain untouched and denial management stops. All because the new company hasn’t yet had the chance to understand your payer mix.

Practices that lose money during a switch usually either:

1. Let their old company stop working claims the day the contract ended.

2. Let the new company start from a blank slate with no plan for the accounts receivable already open.

We’ll explain how both of these mistakes can be avoided by the exact terms you put in writing, before signing anything, later on.

Choosing a Transition Timeline Sized for Your Practice

Switching billing companies generally takes between 30 and 45 days, particularly for larger, multi-provider groups with dedicated billing staff. But if your practice runs on one or two billers, or still handles claims with an in-house medical billing team, this transition time is unrealistic.

Timelines for a smaller practice usually look more like this:

1. Weeks 1 to 2: Your new billing company pulls your claims history, confirms provider credentialing, and connects to your EHR.

2. Weeks 3 to 4: New claims flow through the new company, while your outgoing vendor keeps working pre-cutover claims.

3. Weeks 5 to 8: Your new team absorbs the remaining old accounts receivable, and you compare denial rates and days in AR against your baseline.

Stretching this timeline further is unnecessary. But rushing the transition process can create those revenue dips you may be worrying about.

Decide Who Works Your Old Accounts Receivable First

In the switches we’ve supported at PMN, one question determines whether the transition is smooth or messy: Who is responsible for the claims and balances that are open on the day you switch? That’s why getting this question settled in writing (not just in a phone call!) before anyone signs is essential. 

For example, some outgoing vendors will continue to handle aged claims for 60-90 days as part of their offboarding terms. Others will want to stop working as soon as the contract ends, leaving that revenue untouched unless your new company begins right away.

An unresolved AR backlog is a real issue for small practices, leaving real cash flow that’s either collected or, in the worst circumstances, written off. 

The solution here is to ask both companies directly which one will manage your accounts receivable after the cutover date. 

Protect Patient Data During the Medical Billing Transition

Switching billing companies also means moving patients’ protected health information from one vendor to another, making HIPAA compliance another key consideration.

Under HIPAA, your outgoing billing company is a business associate – a relationship that doesn’t end when the contract does. Federal regulations require business associate agreements to state what will happen to protected health information when the relationship terminates, including its return or destruction.

These regulations mean you’ll need:

– Written confirmation that your old vendor returned or destroyed your data.

– A new business associate agreement executed before any patient information changes hands.

– A clear answer on data security during the transfer itself.

Outsourcing Medical Billing Again? Choose a Partner You Can Leave Easily

If this isn’t your first time outsourcing medical billing, use the switch to fix the terms that made leaving so difficult. Everything from long-term contracts and setup fees to early termination penalties will make your next switch painful, too, if you ever need one.

You can do this by asking a prospective billing company three questions before you sign. What happens if you need to leave in a year, and what does it cost to leave early? Who owns your claims data if the relationship ends?

Here at PMN, for instance, our rates start at just 3%, with no setup fees and no long-term contracts, and our claims clear on the first past 99.98% of the time. These terms ensure that no practice we work with will ever feel stuck the way you might feel right now.

How to Maintain Patient Satisfaction and Confidence Through the Change

Patients won’t read your new billing company’s onboarding paperwork, but they will notice a different-looking statement or a new phone number.

A short notice on a routine statement, or a line in your patient portal, is usually enough to explain who handles billing now, and reassurance that their care quality isn’t changing.

The goal you’re aiming for here is that no patient notices your back office has changed at all, only that their questions are still answered quickly.

Outsourcing Medical Billing with PMN

Switching billing companies isn’t the risk most practice owners assume it is. The revenue dips you may be worrying about stem from a poorly planned AR handoff or a data transfer that wasn’t put in writing, rather than the switch itself. 

Handle those two things properly, and practices outsourcing medical billing to a new partner will feel a huge relief.

Interested in switching billing companies the right way? Book a call with PMN or visit our office in Laguna Hills, Orange County, California, today.

FAQs

How long does it take to switch medical billing companies without losing revenue?

Most small practices complete a clean switch in six to eight weeks, with the new company starting fresh claims while the outgoing company keeps working aged accounts receivable. Trying to fit this into a two or three-week timeline is usually when you’ll begin to see a real drop in collections and revenue.

What happens to my old accounts receivable when I switch billing companies?

What happens to your old accounts receivable depends on your outgoing contract. Some vendors keep working claims from before the cutover date for 60 to 90 days, while others stop immediately. Settle this question in writing before you sign with anyone new.

Will switching medical billing companies affect my patients?

Switching medical billing companies will affect your patients only if they’re surprised by a new phone number or an unfamiliar name on a billing statement. A brief, proactive notice before the switch takes effect keeps most patients from noticing any disruption at all.

What should I look for in a new medical billing company besides price?

Ask a prospective new medical billing company about their first-pass claim acceptance rate, average days in accounts receivable, and what happens if you ever need to leave. A company with strong numbers and no long-term contract has less reason to make it difficult for you to go.