How much do dental billing companies charge?

Outsourced dental billing is priced one of three ways. Vendors rarely explain the trade-offs, because the model they use is the one that favours them.

1. Percentage of collections

The most common model, typically quoted as a percentage of what the vendor collects — commonly in the low-to-mid single digits. Sometimes it is a percentage of total practice collections rather than just insurance, which is a materially different number and worth reading carefully.

• Upside: incentives align. The vendor earns more when you collect more.
• Downside: it scales with your success. A practice that doubles production pays double for work that did not double.
• Watch: whether the percentage applies to all collections or only what the vendor actually worked.

2. Flat monthly fee

A fixed fee per location or per provider. Predictable, budgets cleanly, and does not punish growth.

• Upside: cost stays flat as collections rise — usually the better deal for multi-location groups.
• Downside: weaker incentive alignment, so scope and service levels need to be explicit.
• Watch: what counts as in-scope, and what triggers a fee increase.

3. Hourly or dedicated FTE

You buy hours or a named person. Common for offshore providers and for practices that want a specific person embedded in their workflow.

• Upside: complete clarity on what you are buying, and easy to scale up or down.
• Downside: you are buying time, not outcomes — so measurement is on you.
• Watch: coverage during holidays and absence, and whether you get the same person consistently.

What actually determines your three-year cost

1. Scope. Does the fee include A/R recovery and denial appeals, or only clean-claim submission? The backlog is where the hours go.
2. Aged A/R. Is working your existing backlog included, extra, or explicitly excluded?
3. Verification. Insurance verification is frequently sold separately and is labour-heavy.
4. Growth terms. What happens when you add a location or a provider?
5. Exit. Notice period, and what you get back in what format.

The comparison most practices skip

Before comparing vendors against each other, compare the total against your current fully-loaded in-house cost: salary, payroll taxes, benefits, PTO coverage, software seats, training, and the cost of a vacancy when the biller leaves. That last one is usually the largest and never appears in the spreadsheet.