Switching Medical Billing Companies? Don’t Leave Your Old AR Behind

Switching medical billing companies can cost you money when nobody is assigned to finish the claims your old biller left open. Those open claims are your legacy AR. AR, or accounts receivable, is the money payers and patients still owe your practice for visits you already provided. Legacy AR is the part tied to claims submitted before your switch date.

These claims slip through for two reasons.

• The old biller has less reason to chase them. Once its contract ends, calling payers about your claims is no longer its main job.
• The new biller has no history on them. It did not submit those claims, so it does not know what happened to each one.

A claim nobody works sits until the payer’s deadline passes. After that, the payer owes you nothing. The steps below show you how to keep every old claim moving, from deciding whether to switch through the final check on your old vendor.

See How Often Billing Switches Slow Down Payments

MGMA, the national association for medical practice managers, runs weekly polls of practice leaders. In recent MGMA polling, 32% said their days in AR rose compared with a year earlier.

• What days in AR means: It is total AR divided by average daily charges. The result tells you how many days pass, on average, between a visit and payment, so a higher number means slower cash.
• Why it rose: Several leaders blamed changing their billing company, EHR, or practice management system.
• How bad it can get: One practice said a system change stopped its billing for two months because the two systems would not connect.

Denials add to that pressure. In MGMA’s poll on revenue leaks, 48% of leaders named denials and appeals as their biggest source of lost revenue. Timely filing and credentialing denials were among the causes they listed. Since a switch carries this risk, the first question is whether switching is the right fix for your practice.

Check Whether Switching Medical Billing Companies Is the Right Fix

Switching medical billing companies makes sense when your biller’s results fall short and the gap traces back to how the biller works. Start by separating industry-wide pressure from problems specific to your vendor.

• Denials are rising broadly. In the latest AMA survey of 1,000 physicians on prior authorization, 74% said denials had increased over the past five years. A rising denial count alone does not prove your biller is at fault.
• First-submission denial rate. MGMA benchmarking puts first-submission denials at 7% to 8% across the past four years. MGMA suggests practices can push the rate below 5% with targeted process fixes. Compare your biller’s rate against that range.
• Where the delay sits. Slow adjudication, downcoding, and medical record requests come from payers. Eligibility checks, registration accuracy, unsigned visit notes, and denial follow-up sit on the practice side.

If most of your delay sits on the practice side, a better biller can help. If it sits with a few payers, a switch alone may not change much.

Practices in the MGMA poll that lowered their days in AR used several routes.

• Adding staff or installing new billing leadership.
• Strengthening denial management.
• Closing visit notes sooner.
• Improving front-desk registration and collections.
• Using new software or AI-assisted billing tools.
• Bringing billing back in-house, or outsourcing and changing vendors.

One respondent reported that an overhaul cut days in AR from 67 to under 34. Whichever route you choose, a vendor change starts with knowing what you own.

Know Who Owns the AR When Switching Medical Billing Companies

Your practice owns its AR during and after switching medical billing companies. The billing company only works on it for you, and two federal rules make that clear.

• HIPAA: Your biller is a business associate, so it may use your patients’ information only as your business associate agreement allows.
  
• Medicare payment rules: Under 42 CFR 424.73, Medicare may pay a billing agent only when five conditions are met.
  
  • The agent receives payment under an agency agreement with the provider.
  • The agent’s pay is unrelated to the dollars billed or collected.
  • The agent’s pay does not depend on actual collection.
  • The agent follows payment instructions the provider can change or cancel at any time.
  • The agent acts only on the provider’s behalf.
• Even then, Medicare makes the payment in the provider’s name.

Your contract decides how easily you can take the AR back. Read these four clauses before you tell the biller you are leaving.

• Notice period: This is how many days of written notice you owe. The count usually starts when the company receives your letter.
• Fees after you leave: Check whether the biller can keep taking its percentage on payments that arrive after you leave, including claims it stopped working.
• Data return: Under 45 CFR 164.504(e), your business associate agreement must require the vendor to return or destroy your patient data when the contract ends, if feasible. Where that is not feasible, the vendor must keep protecting the data and limit its use. Check that your contract also names the file format and delivery date.
• Early exit fees: Check whether leaving early costs money, which may affect when you send notice.

The data clause protects you from a risk that outlasts the contract. HHS announced an OCR settlement with a business associate whose information system was breached. OCR opened the investigation after a complaint about an unreported security incident and patient information posted on the dark web. It found the company had failed to notify its covered entity clients of the breach. OCR’s director noted that business associates must notify covered entities without unreasonable delay and within 60 calendar days of discovering a breach. Before you sign with the new company, put the same four protections in its contract, so your next exit is easier.

With the contract terms clear, you can request the records you need while the vendor is still under contract.

Ask Your Old Billing Company for These Records

A written handoff request gives whoever works your old claims, whether that’s the new company or your own staff, everything needed to pick up where the old biller stopped. Send it before your notice period ends. You can adapt this template.

What a few of these items mean

• Aging report. This sorts unpaid claims by age, such as 0 to 30 days and 31 to 60 days.
• Credit balance. This means an account received more money than it owed.
• View-only access. This matters most if you are also changing practice management software, since your team can look up history the export missed.

Why authorization records pay off

Authorization paperwork takes real effort to rebuild. The same AMA survey found that physicians and their staff spend an average of 13 hours a week on prior authorization, and 40% of physicians employ staff who work only on it.

That paperwork also wins appeals. KFF studied the latest insurer-reported authorization metrics, which cover 2025. Appealed prior authorization denials were overturned 67% of the time in Medicare Advantage, 47% in Medicaid managed care, and 43% in ACA Marketplace plans. In Medicare Advantage, a denial the plan upholds goes automatically to an independent reviewer, so those papers stay useful past the first appeal.

Why logins need action

If your old biller set up payer portal accounts under its own administrator, your access ends when it leaves. Ask each portal to move the administrator role to someone on your staff, or open accounts in your practice’s name before the contract ends.

If the vendor misses your deadline or sends partial files, you need a plan for that case.

Know What to Do if the Old Biller Stalls

A vendor that stalls is still bound by your contract and your business associate agreement. HIPAA also puts a duty on your practice. Under 45 CFR 164.504(e), a covered entity that knows of a pattern of activity amounting to a material breach by its business associate must take reasonable steps to cure the breach or end the violation. If those steps fail, it must end the contract where feasible.

Escalate in this order.

1. Send a written follow-up: Cite the specific contract section and business associate agreement terms, and set a new deadline.
2. Document every contact: Record dates, names, and what was promised, since this record supports any later action.
3. Rebuild data from other sources: Your clearinghouse holds claim submission and rejection reports, and payer portals often show claim status and past remittances.
4. Bring in legal counsel: Do this if the vendor withholds data or access, and before you withhold any payment owed under the contract.

Once you have the records, from the vendor or rebuilt, your next job is to lock in a record of exactly what you received.

Record Your Open AR on the Switch Date

Save a switch-date snapshot, a list of every claim open on the old biller’s last day. The list never changes, which makes it the checklist you tick off at the end of the runout. Include four items.

• Days in AR on the switch date.
• AR by payer. Reviewing each payer as well as the total shows you which payers pay slowly.
• Share of AR older than 120 days. This is the bucket you will compare against at the end of the runout.
• A legacy tag on each old claim. Mark every claim submitted before the switch date in your practice management system so any report can filter them.

Every tagged claim then needs an owner, and choosing that owner is your runout decision.

Decide Who Will Finish the Old Claims

The runout period is the stretch after your switch date when someone keeps working claims submitted before it. You have four options, each with a trade-off.

• Old biller finishes its claims. You pay it for a set period. The trade-off is that you depend on its cooperation and must keep its system access open.
• New biller takes everything. All claims and reports sit with one company. The trade-off is that one team carries your full backlog and your new claims at the same time.
• Split by claim type. The old biller finishes recent clean claims, and the new biller takes denials and aged claims that need appeals. The trade-off is managing two vendors at once.
• Your own staff finishes them. You avoid a runout fee and keep full control. The trade-off is staff time, plus the payer portal access and appeal experience your team needs.

Whichever you pick, put three rules in writing.

1. Cutoff rule: Define old claims by date of service or by submission date, and apply it to every claim.
2. Runout length: Set the end date using the deadline method in the payer deadline section below.
3. Fee assignment: Name which company gets paid for which claims. If both contracts pay a share of collections, a claim paid in month two can draw a fee from each unless the contract assigns it to one.

Sample runout clause

“[Vendor] will work all claims with dates of service before [switch date] until [runout end date]. [Vendor] will be compensated only for payments posted to those claims during that period. [Vendor] will send [Practice Name] a status report on every open legacy claim every [two weeks], and will transfer all unresolved claims with notes on [runout end date].”

Comparing runout and cleanup prices

Each vendor sets its own price for this work. Compare quotes on the same terms.

• Fee basis. Is the fee a percentage of collections, a flat project fee, or an hourly rate?
• Scope. Does the fee cover all old claims or only denials and aged claims?
• Write-off approval. Who approves write-offs, and does the vendor earn anything on balances it writes off?
• Reporting. Will it report recoveries on old claims separately from results on new claims, so you can judge its own work?

Once the new company is chosen, Medicare needs to hear about it.

Report the New Billing Agency to Medicare

Medicare keeps your billing agency on file as part of your enrollment. The CMS-855 enrollment application has a billing agency section where you add, change, or remove a billing agency and give the effective date.

• Deadline. Under 42 CFR 424.516(d), physicians and practitioner organizations must report a change of ownership, an adverse legal action, or a practice location change within 30 days. All other enrollment changes, including billing agency details, are due within 90 days.
• Risk of missing it. Under 42 CFR 424.535(a)(9), CMS may revoke Medicare enrollment when a provider fails to meet these reporting rules. It weighs whether the change was reported, how late, and how material the information is.
• How to file. Submit the change through PECOS, Medicare’s online enrollment system, or on the paper CMS-855 form.

Commercial plans handle provider records through a separate credentialing database.

Take Over Commercial Credentialing Records

Many commercial payers pull provider credentialing data from CAQH, which health plans founded and which now operates as DataSpring, powered by CAQH. Providers use the CAQH Provider Data Portal, formerly CAQH ProView, and existing logins, profiles, and attestation histories carried over after the rebrand.

If your old biller managed these profiles, two tasks now fall to your practice.

• Track re-attestation. Providers must re-attest their profile every 120 days, or every 180 days in Illinois. A lapsed profile expires, and payers lose access until it is re-attested.
• Confirm payer authorizations. Payers see a profile only after the provider authorizes them, so check that every plan you bill still has access.

Credentialing settles who can bill each payer, and the next setup decides who sees what those payers pay.

Set Up ERA and Eligibility Access for the Runout Team

An ERA, or electronic remittance advice, is the file a payer sends after processing a claim. It is also called an 835, and it lists what the payer paid, denied, or adjusted on each claim. Medicare sends ERAs to the submitter or receiver IDs listed on your EDI enrollment, which your new biller will ask you to update.

Medicare contractor First Coast’s current EDI instructions show how that update can cut off your old biller, and how to prevent it.

• The risk. The enrollment form has a block where you list the existing submitter and receiver IDs you want to keep. Every ID you leave off is removed when the form is processed. From that day, an old biller doing runout work can no longer see what Medicare paid or denied.
• The fix. List the old biller’s ID in that block while it finishes claims. When the runout ends, send a written request on letterhead to remove it.
• The signature. The form must be signed by an authorized or delegated official of your practice. Clearinghouse and billing service representatives are not permitted to sign.
• The timing. First Coast asks you to allow two weeks for processing, so file the form ahead of your switch date. Check your own Medicare contractor’s form, since contractors run their own enrollment processes.

Use these steps for the rest of your payers.

• Repeat for each commercial payer. Every payer has its own ERA sign-up through your clearinghouse or the payer’s website.
• Leave EFT alone. EFT is the electronic deposit itself. If deposits already go to your practice’s bank account, the ERA change does not affect where the money lands.
• Update the mailing address for paper checks. If the old biller had checks sent to its own PO box, give each payer your new address so checks for old claims reach whoever posts them.

Eligibility access

Reworking old eligibility denials means checking whether a patient had active Medicare coverage on the date of service. CMS’s HETS enrollment page explains the current rule. Every NPI a vendor or clearinghouse submits through HETS, Medicare’s eligibility system, needs an active HETS EDI enrollment, and requests without one are rejected.

• Ask your new biller or clearinghouse for its HETS unique ID.
• Enroll through your Medicare contractor using the same NPI, individual or group, that you use to bill Medicare claims electronically.

With payment and eligibility data reaching the right team, you can plan the order of work, and payer deadlines set that order.

Work Old Claims in Order of Payer Deadline

Sort old claims by the date each deadline expires, soonest first. A list sorted by claim age alone can let a newer claim with a short deadline lapse while your team works on older ones.

Original Medicare deadlines

• Filing. Claims must reach Medicare within one calendar year of the date of service, under 42 CFR 424.44. Under 42 CFR 405.926(n), a determination that a claim was filed late is not an initial determination, so it cannot be appealed.
• Redetermination. This first appeal is due within 120 days of receiving the denial notice, and Medicare assumes you received it five days after the date printed on it. The contractor then has 60 days to decide.
• Later levels. The CMS appeals flowchart sets out the remaining windows.
  • You have 180 days after the redetermination decision to request reconsideration, which also has a 60-day decision limit.
  • You then have 60 days to request a hearing with an administrative law judge, which requires at least $200 in dispute for 2026.
  • Federal court review requires at least $1,960.

Counting a deadline, step by step

Take a denial notice dated June 1.

1. Medicare presumes you received it on June 6.
2. Count 120 days from June 6, and the redetermination request is due by October 4.
3. Put that date on the claim’s line in your list, then repeat for every open denial.

High-dollar Medicare claims already at the second level still have several levels open, which makes them strong candidates for the top of your list.

Medicaid deadlines

• Federal ceiling. Under 42 CFR 447.45(d), each state Medicaid agency must require providers to submit claims no later than 12 months from the date of service. States can set shorter limits, so check your state’s provider manual and any Medicaid managed care contract.
• Medicare crossover claims. When a Medicare claim was filed on time, the state agency may pay a Medicaid claim for the same service within 6 months after the agency or the provider receives notice of the Medicare decision. Flag crossover claims separately, since their clock runs from a different date.

Commercial and Medicare Advantage deadlines

No federal rule sets one filing limit for commercial plans. Each deadline comes from your payer contract or the payer’s provider manual. Build a deadline sheet for every payer on your aging report.

1. Find the initial filing limit and note whether it counts from the date of service or the date of discharge.
2. Find the corrected claim limit, which is often separate from the initial filing limit.
3. Find the appeal limit and the number of appeal levels.
4. Note whether the payer accepts clearinghouse acceptance reports as proof of timely filing, and keep those reports for every old claim.

Your working order

1. Claims rejected by the clearinghouse. A rejection means the claim never reached the payer, so the filing clock keeps running.
2. Denials still inside an appeal window, ranked by days left.
3. Claims with no payer response. Run an electronic claim status check, the X12 276/277 transaction, before anyone picks up the phone. The latest CAQH Index, released in February 2026, found adoption of fully electronic claim status inquiries reached 81%, so this route is widely available. It can also show a claim the payer has no record of.
4. High-dollar claims older than 90 days that can still be paid.
5. Small balances past every deadline. Write them off with a recorded reason.

Runout length

Set the runout end date on or after the latest deadline on your list, which also tells you how long the whole switch will take.

Deadlines tell you when to act, and denial reasons tell you what action to take.

Fix Old Denials Based on Why They Were Denied

Each denial reason calls for its own fix. KFF notes that complete, uniform public data on claim denials exist only for plans sold on HealthCare.gov, where federal rules require insurers to report them. A KFF analysis of the latest available data, for 2024, found those insurers denied 19% of in-network claims. KFF also cites a national NAIC summary showing a 16% average denial rate that year across individual and group plans. That figure covers in-network and out-of-network claims and excludes pharmacy. Your own mix will differ if most of your patients have Medicare or employer coverage.

Among in-network ACA Marketplace denials, these were the shares of denial reasons insurers reported.

• 36% other, with no specific reason given.
• 25% administrative. KFF defines this as duplicate claims, missing information, late filing, or a provider the plan had not approved.
• 13% excluded service.
• 9% missing prior authorization or referral.
• 5% lack of medical necessity.

KFF also notes that a denied claim later resubmitted and paid does not count as denied in its figures. Sort your old denials into three groups.

• Corrected claims. These are missing information, wrong patient details, and duplicates. Fix the error and resubmit within the payer’s corrected claim limit.
• Formal appeals. These are medical necessity, coding disagreements, excluded-service disputes, and missing authorization. Send medical records and a letter explaining why the claim should be paid.
  • Plan how those records will travel. The same CAQH Index found adoption of fully electronic medical attachments, the transaction for sending supporting documents, fell to 24%.
  • Expect many appeals to need portal uploads, fax, or mail, and build that time into your deadlines.
• Enrollment fixes. These are credentialing denials, where the payer does not show the provider as properly enrolled. Send them to your credentialing contact before anyone resubmits.

Give each group one owner and its own column on your old-claims list. Clear the corrected claims first, since they take the least time and free up your appeals staff for letters.

Cleanup can also turn up the reverse problem, a payer that paid you too much.

Refund Overpayments Before the Legal Deadline

Medicare and Medicaid overpayments found during cleanup fall under the 60-day overpayment rule.

• When the clock starts. Under the current rule, the 60 days begin once you know about the overpayment, using the False Claims Act knowledge standard. Treat the date your billing company reports an overpayment to you as day one.
• How to pause it. CMS allows up to 180 days of pause while you investigate, in good faith, whether related claims were also overpaid.
• How far back it reaches. The rule carries a six-year lookback. That is why the handoff request asks for closed-claim history, and why you should keep that export for at least six years.

Federal enforcement shows the cost of sitting on a known overpayment. Both of these settlements resolved allegations, with no determination of liability.

• Oglethorpe: In a DOJ settlement, a psychiatric hospital operator, its founder, and two top executives agreed to pay $32 million. The government alleged they knowingly failed to return Medicare overpayments that the company’s own consultants had identified. They also agreed to a 10-year exclusion from federal health care programs that began in July 2026.
• McLaren Health Care: DOJ’s 2026 health care fraud case summaries report that McLaren Health Care agreed to pay $1.9 million to resolve allegations that it failed to repay overpayments in time.

Set up three controls before cleanup starts.

• A separate credit balance report showing the payer, patient account, and date found.
• One person at your practice who approves each refund.
• A log of the date each refund is sent, which is your proof that you met the deadline.

Patients can be owed refunds too, and their accounts need their own handoff plan.

Pick One Date for Switching Patient Statements

Patient balances are the deductibles and coinsurance patients owe after insurance, and they need a clean handoff between companies. When two billing companies send statements at once, a patient can receive two bills with two phone numbers and no clear answer on whom to pay. Set one statement switch date and complete four tasks.

• Choose the date after which only one company sends statements.
• Update the phone number and payment link printed on each statement.
• Move every active payment plan to that company, with each patient’s remaining balance and schedule.
• Move patient credit balances with the accounts so refunds come from one place.

Some patient balances have already left the statement cycle because they were sent to a collection agency.

Sort Out Accounts Already With a Collection Agency

Handle the balances your old biller placed with a collection agency before the new company starts sending its own placements.

• Get the placement list. Ask for every account placed with an agency, with the placement date and balance.
• Check the agency contract. Find out whether the agency contract is with your practice or with the old biller. If it is with the biller, arrange a direct agreement or a transfer.
• Stop double placements. Make sure the new company does not send an account the agency already holds.
• Route agency payments. Tell the agency where to send collected money and payment reports after the switch, so those payments post to the right account.
• Close the loop on paid accounts. When a patient pays the agency, confirm the balance is cleared in your system so the new company does not bill it again.

With payer claims, patient accounts, and agency placements all assigned, the last job is proving every claim reached an outcome.

Match Every Old Claim Before You Pay the Final Invoice

Hold the old biller’s final invoice until your snapshot is fully matched. Mark every claim with one of four results.

• Paid and posted
• Denied and still under appeal
• Handed to the new owner with notes attached
• Written off with a recorded reason

Then run three checks.

1. Unmatched claims. Investigate any claim without one of the four results before the runout ends.
2. Dollar totals. Open AR on the switch date should equal the payments, adjustments, and transferred balances posted against those claims since then. A gap means a claim is missing.
3. Trend check. Compare current days in AR and the share over 120 days against the snapshot to see whether your cash flow slowed.

The final step is getting written confirmation from the old company of what happened to your patient data under the business associate agreement.

If you want a second review of your open claims list before you give notice, OmniMD’s revenue cycle team can go through it with you and map each claim to its payer deadline.