You've been thinking about it for months. Maybe years. The denial rate keeps climbing. The reports are late or don't arrive at all. You call your account manager and get a ticket number instead of an answer. Your AR aging is getting worse and nobody can explain why.
You know you need to fire your billing company. But you haven't done it because the idea of transitioning mid-stream terrifies you. What if claims fall through the cracks? What if there's a gap in submissions? What if it somehow gets worse?
Here's what actually happens when you pull the trigger, week by week. Not the sanitized version from a billing company's sales page. The real version, including the parts that are uncomfortable.
The transition starts before your billing company knows you're leaving. This is the most important phase and the one most practices skip.
Get your data. Your patient demographics, claim history, AR aging reports, payer contracts, and credentialing records belong to you. Request a full data export now, while the relationship is still intact. Some billing companies become uncooperative once they know you're leaving. Others have contract clauses that make data export difficult after termination. Get everything in writing before you give notice.
Know your numbers. Pull your clean claim rate, denial rate, days in AR, and collection percentage for the last 6 months. These are your baseline. When your new billing operation improves these numbers (and it should), you want to be able to prove it. Read our guide to reading your aging report if you're not sure what to look for.
Sign with the replacement first. Do not give notice to your current company until you have a signed agreement and a start date with the new one. The worst outcome is firing your billing company and then spending 4 weeks interviewing replacements while nobody is submitting claims.
Read your contract. Check the termination clause. Most contracts require 30-90 days written notice. Some have early termination fees. Some have data retention clauses that affect your ability to access historical records after termination. Know exactly what your contract says before you do anything.
The new company connects to your EHR and clearinghouse. They configure provider records, load your fee schedules, verify payer enrollments, and set up the reporting dashboard. This happens entirely behind the scenes. Your staff doesn't notice anything different. Your current billing company is still operating normally because they don't know yet.
What you feel: Relief mixed with anxiety. You've committed to the change but nothing has actually happened yet. This is normal.
The new billing company starts processing new claims (encounters from this point forward) while your current company continues working existing AR. This is the parallel billing approach and it's the reason you shouldn't experience any revenue disruption. New encounters go to the new company. Old AR stays with the current company until resolved or transferred.
What you feel: Weird. Two billing companies are processing your claims. You're paying two invoices this month. It feels redundant and expensive. It's not. It's insurance against the exact revenue gap you were afraid of.
Once you've confirmed the new company is submitting claims successfully and payers are accepting them, you give written notice to your current billing company per your contract terms.
This is the uncomfortable part. Your current billing company will react in one of three ways: professionally (rare), passive-aggressively (common), or adversarially (occasional). The professional ones wish you well, complete the transition cleanly, and move on. The passive-aggressive ones slow-walk their remaining responsibilities, stop returning calls, and let your AR sit. The adversarial ones threaten contract penalties, delay data exports, or drop your account immediately instead of working through the notice period.
What you feel: Guilt, second-guessing, and stress. Every practice manager who fires a billing company goes through this. It passes. Remind yourself why you're doing this. Pull up that denial rate. Look at the 90+ AR bucket. The numbers don't lie.
During the notice period, your current company is supposed to continue working all existing AR. Monitor this closely. Request a weekly AR aging update. Compare the 90+ bucket week over week. If it's growing, they've stopped working your account.
This is where most practices get burned. The billing company has no incentive to work hard on an account that's leaving. Claims that needed follow-up don't get followed up. Denials that needed appeals don't get appealed. Revenue that could have been recovered quietly expires.
What to do: Set a deadline. Tell your current company that any claims not resolved by [date] will be transferred to the new company. Then actually transfer them. Don't leave money in the hands of a company that has no reason to pursue it.
The new company takes over all remaining AR from the current company. This includes outstanding claims, open denials, and pending appeals. A good new billing company will audit this transferred AR and immediately prioritize claims by filing deadline and dollar value.
This is the moment where most practices realize how bad things actually were. The new company reviews the transferred AR and finds claims that were marked "worked" but never actually appealed. Denials that were written off as "unrecoverable" that are still within the appeal window. Underpayments from incorrect contractual adjustments (CO-131) that nobody audited.
What you feel: A mix of anger and relief. Anger that this revenue was sitting there unworked. Relief that someone is finally going after it.
The first full month of claims processed by the new company hits payers and payments start arriving. Your clean claim rate is now measurable. Your denial rate on new claims is visible. The dashboard shows you numbers that your old company never produced or produced too late to act on.
If the new company is competent, your clean claim rate should already be higher than the old company's. New claims are being scrubbed before submission. Denials are being categorized and worked within days, not weeks. The aging report starts looking different because new claims aren't aging past 30 days the way they used to.
This is the phase that practice managers describe as the "why didn't I do this sooner" moment. The new company has been working through the transferred AR for 4-6 weeks. Appeals that your old company never filed are being paid. Claims that were written off as dead are coming back to life. Underpayments are being identified and reprocessed.
The revenue from recovered old AR shows up as "found money." It's not new revenue. It's revenue you already earned months ago that was sitting in your system waiting for someone to go get it.
Here's what a typical transition looks like by the numbers for a 3-5 provider practice:
| Metric | Before (old company) | After 90 days (new company) |
|---|---|---|
| Clean claim rate | 74-82% | 92-96% |
| Denial rate | 12-18% | 4-6% |
| Days in AR | 45-60 | 28-35 |
| AR over 90 days | 20-30% of total AR | Under 10% |
| Monthly collections | 85-88% of allowable | 94-97% of allowable |
| Reporting | Monthly PDF, if requested | Real-time dashboard |
| Account manager response | 48-72 hour ticket | Same-day direct contact |
The improvement in monthly collections is the number that matters most. A practice billing $200K/month that moves from 86% to 96% effective collection rate gains $20K/month in recovered revenue. That's $240K per year. After the new billing company's fee (typically 4.9-7% of collections), the net improvement is still $180K-$220K per year.
The transition cost (temporary overlap in billing fees during the parallel period) is typically $3,000-$8,000. The ROI on that investment is measured in weeks, not months.
Every month you stay with a billing company that's underperforming costs you money. Not theoretical money. Actual dollars that enter your system as billed charges and disappear somewhere between submission and collection. If your billing company is showing warning signs, the cost of waiting exceeds the cost of switching within 60-90 days.
Some practices get so frustrated they fire their billing company before finding a replacement. This creates the exact revenue gap they were afraid of. Always sign with the replacement first. The parallel billing approach only works if the new company is already operating when you give notice to the old one.
Once you give notice, assume your current billing company's effort level drops immediately. Some are professional and maintain effort. Many aren't. The claims that needed follow-up during that notice period represent real revenue. If you don't monitor it and transfer unworked claims to the new company promptly, that revenue dies in the transition.
Not every billing company deserves to be fired. Some are doing a good job and the practice just doesn't realize it. Before you make the decision, run these numbers:
Your clean claim rate. If it's below 90%, your billing company isn't scrubbing claims before submission.
Your denial rate. If it's above 8% and the same denial codes appear month after month, root causes aren't being fixed.
Your AR over 90 days. If it's above 15% of total AR and growing, claims are aging through the system without being worked.
Your account manager's response time. If it takes more than 24 hours to get a specific answer to a specific question, your practice is one of too many in their queue.
If two or more of those are failing, the billing company isn't earning their fee. The Revenue Recovery Simulator can show you exactly how much the gap is costing you annually.
The question isn't whether switching is disruptive. It is, for about 6 weeks. The question is whether 6 weeks of mild disruption is worth $100K-$250K in annual revenue improvement. For every practice we've transitioned, the answer has been yes.
We'll run a free, confidential analysis of your current billing performance before you commit to anything. If your billing company is actually doing a good job, we'll tell you. If there's revenue on the table, we'll show you exactly how much.
Get a Free Confidential Analysis →