10 Questions You Must Ask Before Hiring a Medical Billing Company

A bad billing company hire does not announce itself on day one. It shows up three months later as a rising denial rate nobody can explain and an AR aging report nobody has looked at since onboarding.

Knowing how to hire a medical biller starts with the right questions to ask medical billing company prospects, and asking them before you sign, not three months in, when the damage is already done.

Disclaimer: The information in this article is for general educational purposes only and does not constitute legal, financial, or compliance advice. Billing codes, payor rules, and regulatory requirements change frequently. Verify current requirements with your payor, your compliance officer, or a certified billing professional before making changes to your billing practices.

Key Takeaways

• Every answer below should come with a number attached. If a billing company cannot give you a specific figure, that is the red flag, not a tone or a vibe.
• Specialty-specific denial rate benchmarks exist and any serious billing partner should know theirs.
• Contract termination notice longer than 90 days, or any early termination penalty, is outside normal industry practice.
• Pricing should fall within known market ranges: 4% to 9% of collections, or $1,000 to $5,000+ monthly retainer.
• A billing company that cannot name its average AR days or net collection rate does not track its own performance closely enough to manage yours.

What a Medical Billing Company Actually Does for Your Practice

Before evaluating anyone, it helps to know exactly what do medical billers do day to day, since the answers to the 10 questions below only mean something against that backdrop.

A billing partner handles charge capture, coding accuracy, claim scrubbing, submission, payment posting, denial management, and AR follow-up. Some also manage credentialing, prior authorization, and eligibility verification as part of a broader revenue cycle relationship rather than a narrow claims-processing service.

How does medical billing work in a well-run partnership comes down to one thing: every number below should be available to you on request, in writing, without a delay. Denial rate, AR days, clean claim rate, net collection rate.

If a prospective billing company treats any of these as private information, that alone is worth asking about before you go further.

For a fuller picture of what outsourcing can do beyond these core functions, see A3’s breakdown of the key advantages of outsourcing physician billing services.

Your Checklist for Hiring a Medical Billing Company

Ask these questions in order. Each one should be answered with a real number or a real standard, not a description of values or culture. If you get description instead of data, ask again before moving to the next question.

Question 1: What specialties do you have direct experience billing for, and what is your denial rate for each?

A strong answer will come with a specific specialty list paired with real denial rate figures. For primary care, that should be 5% to 8%. For orthopedics, 8% to 12%. For behavioral health, the hardest specialty to bill, 15% to 30% is the industry range, and anything below 10% in that specialty is genuinely strong performance worth confirming.

Red flag: “We bill for all specialties” with no specific denial rate offered for any of them, or a denial rate quoted with no specialty breakdown at all.

If you want to understand what’s actually driving those denial rate numbers, A3’s guide to the most frequent denial codes in 2026 breaks down the specific reason codes behind them.

Question 2: Are your coders AAPC certified, and how do you keep certifications current as codes change every year?

You must receive a confirmation of CPC or specialty-specific AAPC certification for the coders assigned to your account specifically, plus a description of annual recertification and how the company tracks the yearly CPT and ICD-10 code release cycle.

Red flag: Uncertainty about whether coders hold any formal certification, or an answer that refers to certification at the company level without confirming it for the actual coders working your claims.

Question 3: Which EHR and practice management systems do you currently support, and how long does integration take?

You should get a direct yes or no on your specific system by name, with a stated integration timeline, typically 2 to 4 weeks for a standard EHR connection.

Red flag: A vague “we can work with anything” without confirming your specific system, or an integration timeline longer than 6 weeks with no explanation of why.

Question 4: What is your average AR days and net collection rate across your client base?

You are looking for something like AR days under 35, ideally closer to 30, and a net collection rate above 95%. These are the two numbers that tell you whether a billing company actually collects what they bill, not just whether they submit claims on time.

Red flag: “We don’t track that across clients” or a number with no context for how it compares to your specialty’s benchmark.

Question 5: How do you ensure HIPAA compliance across your billing operations?

They must share specifics on signed Business Associate Agreements, encrypted data transfer protocols, and a defined HIPAA training cadence for staff, typically annual at minimum.

Red flag: A general assurance of being “fully compliant” with no mention of a BAA, no description of how PHI is transmitted, and no training schedule offered.

Question 6: What are the contract terms, and what is the termination notice period?

Here you are looking for a securing a termination notice period of 30 to 90 days, with no early termination penalty attached. Month-to-month terms are increasingly standard in this industry and should be available if you ask.

Red flag: Multi-year minimum commitments, termination notice periods longer than 90 days, or any early termination penalty fee buried in the contract language.

Question 7: What reporting will I receive, and how often?

Monthly reporting by default, covering denial rate, AR days, clean claim rate, and net collection rate, delivered proactively without you having to request it.

Red flag: “We can put together a report if you need one” instead of a standing monthly report that exists regardless of whether you ask.

Question 8: What is your pricing model, and what is included versus billed separately?

What a strong answer sounds like; a clear quote that falls within known market ranges, 4% to 9% of collections for percentage-based pricing, or flat-fee pricing, or a per month figure for a retainer, with an explicit list of what that price includes.

Red flag: A headline rate at the low end of the range, below 4%, that turns out to cover claim submission only, with denial management, AR follow-up, and credentialing billed as separate add-ons once you ask.

Question 9: Can you provide references from practices you have worked with for at least a year, including their current denial rate?

You are looking for willingness to connect you directly with a current client of at least 12 months, ideally in your specialty, who can speak to their actual current denial rate and collection performance.

Red flag: Reluctance to provide any direct reference, only offering very recent clients under 6 months, or offering only written testimonials instead of a live reference.

Question 10: Who owns AR follow-up, and what is your recovery rate on claims over 90 days old?

They must be able to provide you with details of a named team or role responsible for aging AR, with a stated recovery rate on claims past 90 days. Industry data shows recovery rates drop significantly after 90 days, so a billing company that actively works this bucket should be able to quote you a specific recovery percentage rather than a shrug.

Red flag: “That’s handled case by case” with no named owner and no recovery rate offered for aged claims.

For more on what a real AR recovery process looks like, see A3’s explanation of how the AR recovery process works.

Summary of Red Flags That Should End the Conversation Immediately

• No specific denial rate by specialty, only a vague company-wide average with no context
• AR days above 40 or net collection rate below 90%, both below acceptable industry standard
• Contract termination notice longer than 90 days, or any early termination penalty
• A pricing quote below 4% of collections with no explanation of what is excluded
• No named owner for AR follow-up past 90 days
• Defensiveness or evasiveness when asked for a specific number instead of a description.

Getting It Right the First Time

Switching billing partners is disruptive. It means a transition period where claims can slow down, a learning curve for the new team on your specialty and payor mix, and time spent re-establishing the reporting cadence you actually need. Asking these 10 questions, and insisting on a real number for each, is significantly less costly than discovering the answers after six months of declining collections.

The strongest signal in any evaluation is not one great answer. It is whether every answer comes with a number attached. A billing partner who can quote denial rate, AR days, net collection rate, and recovery rate without hesitation is managing their business by the same metrics you need them to manage yours by.

A3 Medical Billing as a professional billing company in the USA answers every one of these 10 questions with a real figure, not a description. AAPC-certified coders, a 99% clean claim rate on first submission, transparent monthly reporting, and no long-term lock-in contracts.

Contact A3 for a free practice audit and ask us these exact 10 questions yourself.

Frequently Asked Questions

How long should it take to switch medical billing companies?

A typical transition takes 30 to 60 days, covering data migration, EHR integration setup, staff training on your specialty, and a parallel run period where both the outgoing and incoming billing teams have visibility into active claims.

Should I choose a billing company based on price alone?

No. A quote below the typical 4% to 9% range for percentage-based pricing often excludes denial management or AR follow-up as separate add-ons, which can make a seemingly cheap option more expensive once those services are billed.

What is a reasonable denial rate to expect from a billing company?

Top-performing billing partners keep denial rates below 5% for most specialties, with behavioral health and oncology running higher due to complexity, typically 10% to 15% even at strong performance levels.

Do I need a billing company that specializes in my specialty?

Specialty experience matters most for high-denial categories like behavioral health, oncology, orthopedics, and cardiology. For straightforward primary care billing, broad experience without deep specialty focus is often sufficient.

What questions should I ask about data security?

Ask specifically about signed Business Associate Agreements, encryption standards for PHI transmission, staff HIPAA training frequency, and what happens to your data if the relationship ends.