Practice Revenue Assessment: What Is Your Current Billing Operation Really Costing?

Discover how a practice revenue assessment can uncover hidden billing costs, revenue cycle gaps, workflow inefficiencies, aging insurance A/R, and opportunities to improve financial performance.

Oswego Medical Billing Solutions

5 min read

What Is Your Current Billing Operation Really Costing Your Practice?

Most healthcare practices know how much they pay their billing staff.

Fewer understand the complete cost of managing billing internally.

Salary and hourly wages are only part of the calculation.

Employee benefits, payroll taxes, training, software subscriptions, staff turnover, management oversight, insurance follow-up, and administrative inefficiencies can substantially increase the true cost of maintaining an internal billing operation.

These expenses may be spread across several departments and financial reports, making them difficult to evaluate together.

A practice revenue assessment can provide greater visibility into these costs and help practice owners determine whether current billing operations continue supporting financial and operational goals.

Payroll Does Not Tell the Entire Story

Payroll is usually the most visible cost associated with an internal billing department.

However, the actual financial commitment may also include:

Employee benefits
Payroll taxes
Paid time off
Recruitment expenses
Training and continuing education
Overtime and temporary coverage
Management and supervisory time

When these expenses are evaluated together, the cost of in-house medical billing may be higher than practice leadership initially expected.

The objective is not to assume that internal billing is ineffective.

The objective is to understand its complete financial impact.

Software and Technology Add Another Layer

Billing operations depend on more than staff.

Healthcare practices may also pay for:

Practice management software
Electronic health record integrations
Claims submission tools
Clearinghouse services
Reporting platforms
Payment processing technology
Technical support and system maintenance

Some of these expenses are easy to identify.

Others may be bundled into separate contracts, transaction fees, or technology subscriptions.

A billing cost analysis should account for both staffing and technology because the two work together to support the revenue cycle.

Management Time Has Financial Value

One of the most frequently overlooked expenses is leadership time.

Practice owners and administrators may spend hours addressing:

Staffing concerns
Billing questions
Training needs
Workflow interruptions
Unresolved claims
Reporting issues
Collection concerns
Employee coverage

Every hour spent managing billing operations is time that cannot be directed toward patient access, staff development, strategic planning, or practice growth.

Management time may not appear as a separate billing expense, but it still carries operational and financial value.

Turnover Can Disrupt the Revenue Cycle

The departure of an experienced billing employee can create an immediate knowledge and coverage gap.

Remaining team members may absorb additional responsibilities while leadership recruits and trains a replacement.

During that transition, practices may experience:

Delayed claim submission
Inconsistent insurance follow-up
Payment-posting backlogs
Unresolved denials
Reduced reporting visibility
Growth in aging accounts receivable

The impact of turnover is not limited to recruitment expenses.

Revenue cycle performance may also be affected while the new employee learns payer requirements, practice workflows, and existing accounts.

Billing Inefficiencies Are Not Always Obvious

A billing department can remain busy while important revenue cycle gaps continue developing.

Claims may be submitted, payments may arrive, and reports may still be produced.

However, practice leaders may not immediately see:

Claims requiring additional follow-up
Denials that remain unresolved
Slow payment-posting workflows
Coding patterns that should be reviewed
Outstanding balances moving into older aging categories
Differences between expected and actual collections

Strong patient volume does not automatically indicate strong billing performance.

A practice revenue assessment helps leadership look beyond daily activity and evaluate whether billing workflows are producing the expected financial results.

Aging Insurance A/R Can Reveal the Cost of Delayed Follow-Up

Outstanding insurance claims can quietly affect cash flow as balances move into aging accounts receivable.

One unresolved claim may appear manageable.

A growing number of unresolved claims can create significant financial pressure.

Practices should maintain visibility into:

Outstanding insurance balances
Aging categories
Denial trends
Follow-up activity
Collection performance
Recovery opportunities

More Staff Is Not Always the Only Solution

When billing workloads increase, hiring another employee may appear to be the most direct answer.

In some situations, additional staffing may be appropriate.

In others, practice leaders may benefit from first evaluating:

Existing workflow efficiency
Division of billing responsibilities
Claim follow-up consistency
Software utilization
Reporting processes
Current staffing costs
Revenue cycle performance

Adding staff without identifying the source of the billing problem can increase overhead without resolving the underlying issue.

Better visibility helps practices determine whether they need more personnel, stronger workflows, outside support, or a combination of solutions.

In-House and Outsourced Billing Should Be Compared Carefully

The decision between internal and outsourced billing should not be based on percentage fees alone.

A balanced comparison should include:

In-House Billing Costs

Payroll and employee benefits
Payroll taxes
Recruitment and training
Paid leave and coverage
Software and technology
Management oversight
Workspace and equipment
Turnover and workflow disruption

Outsourced Billing Costs

Agreed billing fee
Service scope
Implementation requirements
Communication processes
Reporting capabilities
Revenue cycle support

The goal is to compare the full cost and operational impact of each model, not simply one visible expense against another.

Outsourcing Is Not Automatically the Right Answer

A practice revenue assessment should support an informed decision, not predetermine the outcome.

Some healthcare practices have experienced internal billing teams, manageable overhead, strong collections, and reliable financial reporting.

Others may face growing staffing expenses, increasing administrative demands, limited financial visibility, or inconsistent follow-up.

The appropriate billing model depends on the practice’s:

Size
Specialty
Patient volume
Payer mix
Staffing stability
Technology
Growth plans
Financial priorities

An assessment provides a structured way to evaluate these factors before making a major operational change.

Financial Visibility Supports Better Decisions

Practice owners should be able to answer important questions about their billing operations:

What is the total monthly cost of billing?
How much leadership time is spent managing billing activities?
Are claims submitted and followed up consistently?
How much revenue is sitting in aging insurance A/R?
What is affecting collection performance?
Are current systems supporting continued growth?
Could administrative expenses be reduced?
Would outsourced medical billing provide greater efficiency?

When these answers are unclear, making confident decisions becomes difficult.

Financial visibility helps practice leaders understand where resources are being used and whether those resources are producing the expected results.

What a Practice Revenue Assessment Can Reveal

A practice revenue assessment can help identify billing-related costs, workflow inefficiencies, financial risks, and opportunities for improvement.

The assessment may evaluate:

Billing Cost Analysis

Staffing and payroll expenses
Employee benefits and taxes
Software and technology costs
Administrative overhead
Training and management expenses
Billing-related workflow inefficiencies

Revenue Cycle Performance

Cash flow
Collection performance
Aging accounts receivable
Insurance follow-up
Denial activity
Financial reporting and visibility

Operational Opportunities

Areas where overhead may be reduced
Workflows that may require improvement
Administrative responsibilities consuming staff time
Opportunities to improve financial visibility
Processes that may not support future growth

Procedure Code Analysis

Coding patterns
Underutilized CPT or CDT codes
Potential reimbursement opportunities
Areas where coding accuracy may be strengthened

The findings can help practice owners evaluate whether their current billing structure remains appropriate or whether a different approach should be considered.

The Value Is in Understanding the Complete Picture

The purpose of an assessment is not simply to identify problems.

It is to provide a clearer view of current operations.

A practice may discover that its internal billing department is performing effectively.

It may identify a few processes that need improvement.

It may also determine that staffing costs, software expenses, administrative workload, and revenue cycle gaps are limiting financial performance.

Each finding provides useful information.

Better visibility allows practice owners to make decisions based on actual costs and operational needs rather than assumptions.

Is Your Current Billing Operation Supporting Your Practice?

A billing operation should do more than process claims.

It should support:

Consistent cash flow
Timely insurance follow-up
Accurate financial reporting
Manageable administrative costs
Practice growth
Long-term financial stability

If practice leadership cannot clearly determine what billing costs, how well it is performing, or where improvement opportunities exist, it may be time for a more comprehensive evaluation.

Sometimes the first step toward better financial performance is simply understanding what is happening today.

Related Resources

What Could a Practice Revenue Assessment Reveal About Your Billing Operation?

Many healthcare practices know what they spend on billing staff and software.

Far fewer understand the full cost of billing operations, including administrative oversight, workflow inefficiencies, aging insurance A/R, technology expenses, and the leadership time required to manage the revenue cycle.

Questions worth considering include:

What is the true cost of your current billing operation?
How much leadership time is spent managing billing activities?
Are claims being followed up consistently?
Is aging insurance A/R affecting cash flow?
Do current reporting systems provide enough financial visibility?
Are existing workflows supporting future growth?

A Complimentary Practice Revenue Assessment can help identify opportunities related to:

✅ Revenue visibility

✅ Billing performance

✅ Cash flow

✅ Aging insurance A/R

✅ Administrative efficiency

✅ Sustainable growth

✅ Revenue cycle performance

Request a Complimentary Practice Revenue Assessment

Oswego Medical Billing Solutions

Providing medical billing, provider credentialing, insurance A/R recovery, and revenue cycle support for healthcare practices throughout Oregon and across the United States.

8405 SW BARBUR BLVD, SUITE B
PORTLAND, OR 97219

Phone: (503) 345-4987
Fax: (503) 345-4998