How Much do Dental Billing Services Companies Charge?

Amidst your dental practice revenue cycle management process, considering cost is a significant factor along with the quest for financial clarity and efficiency associated with dental billing service companies expertise. Optimizing revenue for professionals and streamlining administrative tasks are among the leading causes for dentists to outsource dental billing. However, understanding its financial implications influencing the practices is essential to attain its fuller, such as the varying pricing structure and the services offered against the cost you are paying by hiring dental billing experts. For example, the price varies as per the size and volume of claims processing, the equipment and technology used, and the complexity of your practice's billing requirements. Moreover, dentists must ensure keeping informed with the shifting trends in the market toward more customizable pricing models in dentistry billing. Dental practice needs vary, and the industry provides tailored solutions with flexible pricing models to support dynamic revenue cycle management requirements. This comprehensive guide is designed to help you choose the best among the average costs of dental billing services and factors differentiating the pricing.

Dental Billing Outsourcing: The Needs and Benefits

Outsourcing dental billing refers to contracting dental insurance services to an outside agency. Upon signing a contract with a dental billing company, they assign billing experts to handle your dental insurance billing by working regularly.
Proper dental practice management, including dental care, administrative tasks, billing, and claims processing, is manageable for minor or extended dental care practices. Hence, the purpose for which dental practices need RCM companies is to streamline the complex process by receiving productive dental billing solutions and help your team innovate and explore the options to improve the problem areas. The most common reasons why your practice may need an expert partner for understanding and overcoming the many challenges occurring in the process are:

  • Higher insurance aging reports or low collection percentages
  • Lack of experienced staff at dental practice
  • Office manager's lack of time to handle billing
  • Need innovative options in your dental billing examples
  • Your team is taking too much time in insurance billing
  • Your practice needs to resolve issues in dental billing claims
  • You are dealing with inaccurate claims and posting in your dental office
  • Your practice needs credentialing
  • Need a comprehensive understanding of the dental billing process
  • You are working as a startup dental practice

Why Does Your Practice Need to Outsource Dental Billing?

To improve the efficiency and productivity of the process, the dental billing outsourcing companies offer comprehensive solutions to eliminate practice errors and billing pitfalls, such as eligibility verification, claims processing, and AR follow-ups, along with various other benefits, including:

  • Increased productivity and practice efficiency
  • Practice compliance with expertise and industry updates
  • Leading cost-effectiveness in comparison to traditional/in-house billing
  • Lessening the need for hiring and training additional staff to handle the time-consuming process
  • Smooth the practice through efficient and innovative dental billing software
  • Remote dental billing companies with various expertise to deal with several claim challenges

What do dental billing service companies offer?

Following are some of the standard services that the best dental billing companies offer in the process:

  • Appeal denied claims
  • Insurance aging report follow-up
  • Sending claims through a clearinghouse
  • Posting insurance payments
  • Posting insurance EFT payments
  • Posting insurance virtual credit card payments
  • Applying PPO adjustments and write-offs
  • Submission of secondary claims
  • Attachments with electronic claims
  • Mailing claims when applicable
  • Regular communication, daily or weekly
  • Input of fee schedules
  • Reporting

How much do dental billing service companies charge?

Among the various factors affecting the cost of dental billing RCM, the insurance revenue the company receives each month determines the amount of your dental RCM services for the claims handled. However, you must ensure that you compare the cost of hiring a full-service RCM company or an in-house billing team member.

Insurance Revenue Collection Maximum Monthly Cost for Billing
Under $40k Collected $1, 350/month
$40k to $100k collected 3.5% of your collections, maximum $3,500/month
$100k up to $150k collected $3,500 plus 3% of the amount over $100k, maximum $5,000/month
$150k up to $200k collected $5,000 plus 2.5% of the amount over $150k, maximum $6,250/month
$200k up to $500k collected $7,500 plus 2% of the amount over $200k, maximum $12,250/month

Percentage-based Pricing Model

  • According to the percentage-based model, RCM companies charge a percentage of monthly collections as their fee, usually between 4% to 10% of the sum charged as fee for service provided.
  • Some RCM companies charge a flat fee per claim submitted or against the service provided, including claims submission, insurance verification, and patient billing usually between 2% to 10%.
  • Dental billing outsourcing companies often charge monthly retainer fees ranging from several hundred dollars up to thousand dollars. The fee covers many services or hours needed for performance each month.

The Cost of a Dental Insurance Coordinator/In-house Billing Expert

According to Glassdoor reports of September 2023, the estimated total pay for a dental insurance coordinator is $67,493 per year in the United States area, with an average salary of $54 113 per year. The numbers represent the median, as the midpoint ranges from our proprietary Total Pay Estimate model and is based on wages collected from our users.
A recent survey on dental salary reports shows that the average salary of a dental office insurance coordinator is $22/hour. Hiring an in-house W2 employee can cost you between $45,760 and $64,064 yearly per the benefits included.
Overhead expenses for internal W2 workers exist in addition to their hourly or pay rates. W2 workers typically cost 1.25 to 1.4 times any organization's base salary range. Employer taxes, including social security, Medicare, workers' compensation insurance, state and federal unemployment, payroll expenses, and any perks you may provide, are all included in this additional salary.
Considering the compensation between 25% to 40% higher than the employee’s base salary, your average dental insurance coordinator will cost $57,200 per year without benefits. However, the calculation will include any bonuses achieved by the employee.

Some Other Common Factors Affecting the Cost of Dental Billing Services

Service Package and Scope

The services determine the charges included in the RCM package, such as claims processing, payment posting, denial management, and patient billing.

The Size and Volume of Practice

Larger dental practices with higher transaction volumes may incur higher charges due to the increased complexity and workload.

Automation and Technology

RCM companies utilizing advanced technology and automation tools may charge differently. Automated processes can also affect efficiency and, in turn, pricing.

Customization and Specialty Requirements

Practices with specific billing needs or those offering specialized dental services may require personalized solutions that also affect the cost.

Percentage-based or Flat-Fee Pricing

RCM companies may charge a percentage of the revenue they collect or a flat fee per transaction. The pricing model can significantly influence the entire cost of dental billing services.

Compliance and Quality of Service

RCM companies prioritizing compliance with healthcare regulations and consistently delivering high-quality may charge higher fees.

Contract Terms and Duration

The agreed-upon length and terms can also affect the pricing structure. Long-term contracts may offer discounts compared to shorter-term agreements.

Additional Fees

Some RCM companies may charge additional fees for extra services such as software, licensing, or handling specific types of claims or billing scenarios.

MedsDental A Leading Choice for Your Dental Administrative Staff and Cost-Effective Solutions Provider

Considering the cost is an inevitable factor while optimizing your dental practice revenue. However, partnering with experts like MedsDental billing will pose several efficient options at manageable costs and help you easily handle intricate tasks such as:

  • Check in: your patients
  • Schedule appointments
  • Respond phone calls
  • Stay ahead on copays
  • Collect the correct payments from patients
  • Present valuable treatment
  • Office marketing
  • Patient Satisfaction

Always thoroughly research various factors affecting the cost of dental billing services, reach out to multiple RCM service providers, discuss your needs, and request detailed quotes. Prices can vary, so it’s essential to consider the overall value and services provided when comparing dental RCM companies.