What is the medical billing industry outlook?

In Tebra's 2024 Medical Billing Benchmark Report, over 100 medical billing companies in North America shared what they expect in the future. Despite the shifting regulatory and payment landscape, 42% of respondents said they anticipate 6-10% of revenue growth in the coming year, and a little more than a quarter are hoping for growth above 11-20%. 

The medical billing market has its own set of challenges, including regulatory changes, legacy technology, and late payments — but several trends are making it easier than ever for companies to combat these threats. To understand why so many billing companies remain optimistic, start by learning more about the specific challenges — and the solutions you can implement as a medical biller.

In Tebra's 2024 survey of medical billing company challenges, nearly all respondents (97%) cited rising costs or inflation impacting their organizations. Here are the top operational areas affected:

With costs on the rise, achieving a strong profit margin is going to be even more of a challenge. For those hoping to optimize profitability, exploring solutions that minimize expenditures and generate additional revenue will be a top priority.

Here are some other top challenges billers are facing, along with the actionable steps to overcome them. 

Regulatory changes can create friction, especially when they shift patient-provider responsibilities. For example, the Consumer Financial Protection Bureau (CFPB) established a rule on January 7, 2025 that significantly changes medical debt reporting. This new potential rule will ban showing medical debt on credit reports. As a result, it’s possible that there will be increased difficulty in collections.

To help ensure patient payments, encourage your practice clients to:

They should also use additional digital solutions, such as:

2024 was the worst year ever in terms of breached healthcare records. The Change Healthcare cyberattack shook the healthcare world in 2024 and was the largest healthcare data breach ever reported to federal regulators. 

Not only was the protected health information of at least 100 million individuals compromised in the ransomware attack – covered entities were also impacted. Many providers and medical billing companies faced delays in payment and increased employee costs with having to do tasks like resubmit claims.

Here are steps you and your practice clients can take to prevent HIPAA breaches:

Medical billing companies face persistent issues with payer roadblocks — made all the more challenging by practices failing to document patient visits properly.

In Tebra's 2023 Medical Billing Benchmark report, 27% of billing companies reported that their practices don’t do thorough enough documentation, causing friction between them and their clients.

On top of that, practices are facing increased denials of E/M codes, more stringent ICD-10 coding requirements, and multiple payer IDs — meaning that, without proper documentation, you and your practices may not get paid.

To prevent payer roadblocks, ensure that practice clients: 

If you’re submitting documentation for an appeal, review that documentation and identify where it does or does not support the codes that were billed.

Providing practices with this information can help them improve future documentation and make it easier to win your appeals and get them paid.

In Tebra's 2024 survey of medical billing company challenges, 42% of respondents said they document processes for denials management but do not fully standardize them across their teams.

Without consistent processes, it becomes harder to track and improve denial metrics — which leads to lost revenue. Billing companies can combat this by setting clear standard operating procedures (SOPs), templates, and workflows in place.

As mentioned earlier, 42% of survey respondents in Tebra's Medical Billing Benchmark Report anticipate revenue growth of 6-10%, with a focus on improving patient collections and expanding service offerings. With changes to medical reporting and rising operating costs, many healthcare providers expand or turn to outsourced medical billing to optimize costs. 

There have also been updates to pricing. For example, more billing companies are implementing setup fees and adjusting rates to reflect increased workloads and expenses. Billing companies are also offering credentialing as an add-on service. The shift from credentialing as a core service to an add-on offering highlights the evolution of billing services.

However, Tebra research did find that the percentage of billing companies offering credentialing as an add-on service dipped from 2022 to 2023.

“The first thing that people need to do is reassess their business model if they offer credentialing for free," says Jeff Hillam, CEO at Red House Medical Billing. "As an industry, we’ve got to accept that credentialing is a time-consuming and expensive activity for us — it shouldn’t be a loss leader anymore. It should be a profitable activity.”

In Tebra's 2024 survey of medical billing company challenges, 31% of billing companies said their teams spend over 50% of their time on repetitive tasks like claim submissions, denial follow-ups, and eligibility verification.

These tasks are highly automatable, yet they remain a major burden for many teams. Billing teams can employ technology like robotic process automation (RPA), which helps streamline revenue cycle management by using intelligent, rules-based automation to eliminate repetitive tasks that cost valuable time. 

If billers haven’t implemented RPA yet, they are likely to do so soon. 68% of billing companies plan to integrate RPA in the future, emphasizing faster invoicing and improved cash flow management.

In one case, using automation for claims alone resulted in up to 80% of claims being posted without personal intervention. The potential for time and cost savings can be a game-changer if your chosen solution is implemented effectively. 

“While RPA will not replace your staff, it can eliminate hours and hours of tedious work, freeing your team to tackle more complex analytical tasks or take on more clients,” says Brian Cafferty, Vice President of RPA Development at Tebra.

Another transformation in the billing industry is the heavy shift towards specialization. Specialization allows billing companies to dig deep in a few key areas, win more business, scale more quickly, and build confidence and trust with practices. While some specialize in a specific medical area, others may specialize in a certain geographic region. In either case, specialization allows a billing company to develop and deepen its expertise. 

“The concept of being very prescriptive and being very specialized is winning this space right now without a shadow of a doubt," says Sarah Ford, Director of Account Management at Tebra. "One of the friction points I often see is attaining prior authorizations; a lot of specialties require that, and they require exact measures to get that authorization. If billing companies are casting a wide net and saying, ‘We work with everybody,’ they aren’t going to become experts. But by going deep into a specific specialty, they can immediately add value to every single practice in their space.”

With a specialty, you can scale your business faster by pulling from existing sources on enrollments, codes, and fee schedules. When it comes to onboarding, you can utilize the billing processes that already work with existing clients of the same specialty and develop repeatable workflows that streamline setup, training, and billing for your staff.

Customer referrals remain the largest source of new business for medical billing companies. 72% of billing companies in Tebra's 2024 Medical Billing Benchmark Report said customer referrals were their key value driver for winning new business, and 65% said using word-of-mouth marketing was their top marketing priority. 

To maximize new practice referrals, it is important to establish a strong reputation within the healthcare industry and build relationships with peers in the billing space. Establishing and maintaining positive relationships with providers is key. Providing ongoing training, consultation, and strategic guidance will also strengthen your relationship with customers. Implementing mechanisms to gather feedback from practices about their experience and using it to find areas for improvement will boost satisfaction for those who are already satisfied. 

Consistently staying ahead of industry trends and embracing innovative technologies to streamline billing processes will position you as a trusted and valuable partner, ultimately fostering a steady stream of referrals from satisfied providers.

Networking can be thought of as an extension of this strategy. Here are some ways to network and thus strengthen your referral pipeline:

“Billing companies have a giant missed opportunity by not networking with other billing companies," says Jonathan Garth, former Sales Engineer at Tebra. "A lot of billing companies specialize in 1 or 2 types of billing. If you only bill for anesthesia, start networking with billing companies that don’t. When a practice comes to them asking if they do anesthesia billing, they will say, ‘I don’t, but I know someone who does.’ Billing companies often view each other as competition when they’re really not.”

In short, medical billers are facing unique challenges that can slow down payment collections and reduce cash flow. However, there are also many opportunities to optimize growth. Understanding the threats your company and others in your industry are facing, and implementing solutions to overcome them, will improve your bottom line and set you up for success.

For more insights into the industry, check out Tebra’s Benchmark Report: The State of the US Billing Industry. 

Editor's note: This article was updated in January 2025 to reflect the latest data.