When UnitedHealthcare CEO Brian Thompson in December 2024 it sent shockwaves through the insurance industry and highlighted the public’s growing frustration with the way the insurance industry functions.
The US has a high health insurance coverage. For instance, According to US Census Bureau 92% of the population or 305.2 million people had health insurance either for some time or the whole year in 2023. However, when it comes to claim servicing most of the health insurance claims are denied. A study by KFF reveals that in 2023, insurers in the US denied 73 million of 392 million in-network claims.
The high rate of claim rejection puts an enormous amount of financial burden on people, with nearly half of the US adults claiming to have difficulty affording healthcare costs. And this is despite the fact that the US spends more than $4 trillion a year or 20% of its GDP on health care. And one of the primary reasons behind claim rejection is issues with medical billing- a primary reason behind the increasing popularity of medical process outsourcing.
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Top Medical Billing Challenges
Before we talk about how outsourcing medical billing can help, let’s first understand the top challenges that medical billing providers face. Here is a list of those challenges.
1.1 Frequent Regulatory Changes
Healthcare regulations are constantly changing, and staying updated can be challenging. Consider, for example, the evolving CMS guidelines, which make staying compliant a full-time job. The risk of non-compliance is weighing heavily on healthcare professionals who are already striving to offer quality healthcare. Healthcare providers are also required to stay up to date with coding changes like ICD-11 transition planning and modifiers.
1.2 Increasing Claim Denials
As mentioned earlier, a high number of health insurance claims are rejected by health insurers. One research study estimates that 15–20% of the claims are rejected on first submission. Some of the common reasons cited for claim rejection include missing information, mismatched patient demographics, incorrect coding, etc. The introduction of pre-authorization rules in 2025 has further complicated claim submissions.
1.3 Understaffing
The U.S. is dealing with a severe shortage of skilled medical billers and coders. A recent report by AAPC reveals that 35% of providers cite understaffing as their primary concern in 2025. Moreover, as experienced professionals retire from the field, healthcare providers are finding it increasingly difficult to find talent that can fill the gap thus created.
1.4 Documentation Inconsistencies
Inconsistencies in clinical documentation can pose a major hurdle in medical billing. Incomplete or poor documentation can lead to delays in billing, under coding, or claim denials. These inconsistencies have continued to plague the medical billing industry despite AI scribes and EHRs offering support to clinical documentation.
1.5 Reimbursement Delays
Late reimbursement of a claim by a health insurance company can affect the cash flow and financial planning of medical billing providers. As per a report in 2025, providers on average faced a 32-day delay in receiving reimbursements.
1.6 Interoperability Between Systems
Many times, the patient portals, billing software, and EHRs do not fully integrate. This means the operator has to manually enter the data into the system, which can lead to billing delays while increasing the risk of errors.
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Advantages of Medical Process Outsourcing
You can overcome any of the problems associated with medical billing through medical process outsourcing. When you partner with one of the top medical billing outsourcing companies, you get the following advantages.
2.1 Access to Quality Resources
Top-rated medical billing outsourcing companies have best talents on board. Unlike the case in US where you have to deal with talent shortages, you have an oversupply of talent if you partner with an outsourcing company from India. This helps you work with the best talents while also saving costs due to differences in purchase power parity between US and India.
2.2 Regulatory Update
One of the top challenges in medical billing is staying up to date with frequent regulatory changes. However, staying compliant and up to date is never a challenge if you partner with one of the top-rated medical billing outsourcing companies. This is because such companies solely exist to offer medical billing services to businesses in the US.
Therefore, they have resources who are extremely conversant with all the regulatory changes happening in the healthcare sector. This ensures that the claims you file will never have to face rejections due to compliance issues.
2.3 Data Security
By embracing medical process outsourcing, you can remain stress-free about data security. This is because the best medical outsourcing companies adhere to strict data protection practices and have the best firewalls in place to protect your data from unauthorized use.
2.4 Increased Core-Competency Focus
By outsourcing medical billing, you can reduce the burden on your in-house healthcare staff. This can help you offer better quality healthcare while keeping your in-house staff happy.
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Finding Best Medical Billing Outsourcing Companies
To outsource medical billing, you need to first find a reputed medical billing outsourcing company. This process can seem daunting given the availability of so many providers in the market. To simplify the search process, you can ask for peer recommendations. Looking up sites like Clutch, Trustpilot, etc., and checking out Google reviews can be a good starting point in your search.
After you have shortlisted some companies, you can check out their past projects to verify their competency in the field. Also, get on a call with their representatives to know more and identify their suitability for your work.
Final Words
The medical billing process suffers from many challenges, including compliance issues, lack of skilled manpower, reimbursement delays, etc. Additionally, the medical billing process creates an unnecessary burden on healthcare professionals already suffering from excessive workloads. Therefore, the best strategy is to adopt medical process outsourcing.
However, if you feel that outsourcing will lead to loss of control, you can simply hire virtual employees from Remote Resource® at a fraction of the local hiring cost to handle medical billing for you. Connect now to know more and experience the difference by hiring a resource from us for a week at zero cost.
