Benchmarks
What percentage do medical billing companies charge? 2026 benchmarks
The market runs 4 to 10 percent of collections, most commonly 5 to 8. This piece serves both sides of that number: the practice deciding whether to pay it, and the billing company deciding what to charge.
If you are shopping for an outsourced billing service, the percentage is the number that never appears in the pitch. If you run a billing service, the percentage is the number that decides whether you make a living. Same figure, two anxieties. Let us take them in order, with actual benchmarks instead of "it depends."
Part one: for the practice paying the fee
Outsourced medical billing companies typically charge 4 to 10 percent of monthly collections, with 5 to 8 percent the most common band. A 2022 Tebra survey of billing companies found 6 to 7 percent was the single most common rate, chosen by about a quarter of them. Two things move you within that range: specialty complexity and volume. Anesthesia, behavioral health, and other high-touch specialties push toward the top. Higher claim volume pulls the percentage down, because your account is more profitable for the service to run.
There are two other models you will encounter. Per-claim pricing runs $3 to $10 per claim, which favors practices with high-dollar, low-volume claims. Hourly work, usually around $45 an hour, shows up for one-off tasks like credentialing, eligibility projects, or audit support rather than ongoing billing.
What the percentage actually costs
| Monthly collections | At 5% | At 7% | At 9% | Per year at 7% |
|---|---|---|---|---|
| $30,000 | $1,500 | $2,100 | $2,700 | $25,200 |
| $50,000 | $2,500 | $3,500 | $4,500 | $42,000 |
| $100,000 | $5,000 | $7,000 | $9,000 | $84,000 |
The reason this table matters is that the fee scales with your success. Grow your collections and the service gets a raise it did not ask for. That is the structural argument for in-house software, where the cost is flat: at $100,000 a month, 7 percent is $84,000 a year, while flat billing software is a small fraction of that plus the staff time you likely already have.
Red flags in a billing-service contract
- Percentage of "billed" rather than "collected." You want to pay on money that actually arrives, not on what was charged.
- Setup fees on top of the percentage. The best services fold onboarding in.
- Long lock-in. "No long-term contract" is common now; a multi-year term is a reason to negotiate.
- An undisclosed rate. If they will not tell you the percentage until a call, that is a preview of how transparent the relationship will be.
Part two: for the billing company setting the rate
Almost every article on this topic is written for the practice. If you are the one sending the invoice, here is the side nobody covers.
Pick a model, then defend the floor
The three models map to different client shapes:
- Percentage of collections (4 to 10 percent). The default, and the easiest to sell, because your incentive is aligned with the client's revenue. The risk is low-volume months where your effort is fixed but your fee shrinks.
- Per claim ($3 to $10). Predictable for you, and it protects you when a client's collections dip but their claim count does not. Harder to sell to a client who likes the "we only win when you win" story.
- Hybrid. A percentage with a minimum monthly fee. This is the model that actually keeps billing companies solvent, because it captures the upside of a growing client and floors your revenue on a slow one.
The single most important number for your own survival is the minimum monthly fee. A pure percentage means a client who has a bad month, goes on vacation, or slows down over the holidays pays you almost nothing, while your work to maintain their account barely changes. Set a floor, say $500 to $1,000 per client depending on complexity, and put it in the contract.
Price the specialty, not just the volume
A behavioral-health practice with prior-auth headaches and a dermatology practice with clean, repetitive claims should not pay the same percentage, even at identical collections. Charge for the difficulty of getting paid, not only the size of the check. The 6 to 7 percent mode is a starting point; move up for specialties where denials and appeals eat your hours.
What the mode means for your margin
At 6 to 7 percent, a biller handling a few hundred claims a month per client needs enough clients to cover their time, which is where multi-client software stops being a nice-to-have and becomes the business. Per-provider software pricing quietly taxes every client you add; flat, unlimited-client pricing lets the 6 to 7 percent actually reach your margin. That is the whole economic case for the tooling underneath the rate.