The practice in medical billing where a healthcare provider delegates all or part of their billing operations to an external entity is a common strategy. This arrangement involves transferring responsibilities such as claim submission, payment posting, denial management, and patient billing inquiries to a third-party company. For example, a physician’s office might contract with a specialized firm to handle the complexities of insurance claim processing, freeing up internal staff to focus on patient care.
This delegation offers several advantages, including reduced administrative burdens, improved revenue cycle management, and access to specialized expertise. Healthcare providers, especially smaller practices, may lack the resources or knowledge to navigate the increasingly complex landscape of medical coding, compliance regulations, and payer requirements. Outsourcing these functions can lead to faster payments, fewer errors, and increased profitability. Historically, providers managed all billing in-house; however, the rising costs and complexities associated with healthcare administration have driven increased adoption of external solutions.
