Practices in the healthcare industry operate using Revenue Cycle Management in order to remain viable. The billing process includes verifying insurance, entering patient demographics into records, specifying charge entries, submitting claims, awaiting payment posting, conducting follow-ups to secure payments, managing denials, and completing reports. These tasks are time-consuming and tedious. Therefore, many medical practices have decided to outsource billing to ease the collection process. Here are some of the costs of RCM services along with the factors that influence the cost of these services.


Medical billing service charges include one-time expenditures and ongoing payments. Per doctor, it costs about $300 to set up or about $1,000 for each office for RCM services. Administrative costs to fund software maintenance can range from $50 to $250 a month to $3,000 to $6,000 per year for higher-end SaaS solutions. Flat fees can be charged up to $4 to $6 for each claim. On the other hand, some platforms may charge an hourly fee as opposed to a flat fee. The average medical billing service rates can range from $1,000 to $100,000 a month, depending on the organization’s size and needs.

Errors Which Can Increase Costs

RCM services exist to make a smooth financial billing process that requires less time and is more efficient. The main problem practices experience is the increased financial burdens of patients. If the collection system lacks transparency, patients will feel an increased financial burden which will result in more work for RCM services. Another problem that may arise is inaccurate or incomplete details regarding patients. If information about a patient is incorrect, it becomes more difficult to follow up with the patient. This can disrupt the functioning of RCM services which can further increase costs if revenue collection slows down. Incorrect medical coding can hinder the efficiency of RCM services due to a higher probability of claim denials. This will result in increased AR days and delayed payments. Another issue that can delay RCM services is entering information manually. Record keeping should remain automated to avoid errors.

Revenue Cycle Management plays a huge part in the operations of the healthcare industry. There are associated costs with RCM services as well as problems which can also increase costs. Some medical practices choose to outsource RCM tasks to a third party to save time and increase revenue. It may cost more to outsource RCM services; however, the benefits of higher success rates outweigh the higher costs. This means that healthcare practices can focus more on delivering high-quality care by entrusting the billing process to third parties.

Data-Core Healthcare provides end-to-end solutions for all your Billing and RCM woes. To know more about our services, custom software and products built using state-of-the-art AI/ML technologies, please contact us at [email protected]