This post is the third installment of the Medical Billers' Triple Threat series that explores how billing leaders are navigating AI, compliance, and cybersecurity.

Compliance in medical billing has evolved from a background requirement to a front-and-center performance metric. Medicare Advantage audits are intensifying, HIPAA enforcement is tightening, and billing companies are increasingly expected to shoulder responsibilities once reserved for healthcare providers.

As a billing company, you may be wondering how to stay ahead. Here's how forward-thinking billing leaders are transforming compliance from a checkbox activity into a strategic differentiator.

Without clear protocols and documented processes, billing companies struggle to push back on payer denials, protect themselves during audits, and maintain the client trust that drives business growth.

According to Tebra's 2024 survey of medical billing professionals, operational gaps reveal concerning trends:

This lack of operational hygiene opens billing companies to denials, revenue loss, and reputational risk. Jeff Hillam, CEO of Red House Medical Billing, says “Payers benefit from chaos. And when we don’t have our processes documented, we’re a part of that chaos.”

Three major forces are reshaping compliance expectations for medical billing companies — each requiring strategic attention and response.

The Office for Civil Rights (OCR) has updated guidance that emphasizes: 

Billing companies that can't demonstrate compliance readiness, even as subcontractors, may face accountability measures.

Pro tip: Complete and document security risk assessments. Use HealthIT.gov's Security Risk Assessment tool to identify vulnerabilities and create remediation plans. This isn't a one-time activity; annual assessments are becoming the expected standard.

As Aimee Heckman, Director of Revenue Cycle Management at Ash Business Solutions, puts it: "The planned expansion of HIPAA audits, along with updates to the HIPAA Security Rule, will likely increase scrutiny on business associates like billing companies."

Medicare Advantage risk adjustment reviews now target documentation gaps and inconsistent coding practices with unprecedented scrutiny. While providers remain primarily responsible for clinical errors, billing companies must demonstrate that their claims workflows and submission standard operating procedures (SOPs) meet current regulatory standards.

Pro tip: Maintain access control logs. Document who has access to what systems, when access was granted or revoked, and why. These logs become crucial evidence during audits and breach investigations.

Heckman emphasizes the importance of preparation: "If you're selected for an audit, it should be an inconvenience, not a crisis."

As healthcare practices face increased regulatory scrutiny, they're relying more heavily on billing partners to uphold compliance standards, not just handle claim transactions. Billing companies that can't support this expanded role risk losing client trust and, ultimately, business relationships.

Pro tip: Update business associate agreements. Review all vendor relationships to ensure current business associate agreements (BAAs) are in place. Any vendor handling PHI must provide comprehensive BAAs before work begins.

The most resilient billing companies treat compliance as operational hygiene rather than regulatory burden. They understand that well-documented processes don't just satisfy auditors—they improve efficiency, reduce errors, and create competitive advantages.

While comprehensive compliance programs take time to build, several immediate actions can strengthen your position and reduce risk exposure.

Review and document standard operating procedures for denials management, appeals processing, and claim edits. Outdated or inconsistent workflows represent significant audit risks and operational inefficiencies.

Billers who approach SOP hygiene as a trust signal, not just a requirement, will stand out as strategic partners.

Maintain detailed logs of what policies were reviewed, when reviews occurred, and who conducted them. The compliance principle is straightforward: if it's not documented, it didn't happen from a regulatory perspective.

Move beyond annual HIPAA training to quarterly sessions that address current payer rules, timely filing requirements, and emerging compliance issues. Even brief refresher sessions can significantly reduce operational errors.

Alexis Marshall, Client Solutions Manager at Medical Billing Strategies, describes her team's proactive approach: "As new rules and regulations come out, we adjust protocols as needed — so we're not putting out fires."

Designate specific individuals responsible for compliance checkpoints and automation monitoring. This creates accountability and ensures consistent oversight as new technologies are implemented.

Compliance requirements will continue evolving as healthcare regulations adapt to technological advances and changing industry practices. The billing companies that thrive will be those that build compliance into their operational DNA rather than treating it as an external requirement.

Ready to transform your compliance approach?

Download our complete guide to facing the triple threats in medical billing for 2025: AI, compliance, and cybersecurity. Get expert strategies from industry leaders who are successfully turning compliance challenges into business opportunities.