10 Questions to Ask a Mental Health Billing Company Before You Hire

Quick answer: Before hiring a mental health billing service, ask about its first-pass claim rate, whether it specializes in behavioral health, what it charges and what that fee includes, how it protects patient data (including a signed HIPAA Business Associate Agreement), which payers it bills, whether you are locked into a contract, and how often it reports to you. A good partner should give you specific numbers, not vague promises.

Choosing a billing partner is one of the biggest financial decisions a private practice makes. The right company gets claims paid faster and keeps denials low. The wrong one quietly leaks revenue for months before you notice. This buyer’s guide walks you through the 10 questions every therapist, psychologist, psychiatrist, and group practice should ask, and what a good answer sounds like.

Key Takeaways

• Ask for hard numbers: first-pass claim rate, EOB posting time, and days in accounts receivable.
• Pick a billing company that focuses on mental and behavioral health, not every medical specialty.
• Most percentage-based billing services charge a share of what they collect. Compare what is included, not only the rate.
• Avoid long-term contracts. A free trial and month-to-month terms keep the risk on the billing company, not on you.
• Expect daily, weekly, and monthly reports plus a named billing manager you can reach directly.

What Does a Mental Health Billing Service Do?

A mental health billing service is a company that manages insurance billing for behavioral health providers. It submits primary and secondary claims, verifies coverage and procedure codes, posts payments from explanations of benefits (EOBs), follows up on unpaid claims, appeals denials, and reports on your accounts receivable. In short, it handles the paperwork between your practice and insurance payers so you can focus on clients.

Mental health billing has its own rules. Psychotherapy codes are time-based (for example, CPT 90832, 90834, and 90837 depend on session length), many payers require authorizations for ongoing care, and telehealth claims need the correct place-of-service code and modifiers. A billing team that works on these claims every day will catch errors that a general medical biller may miss. If you are still deciding whether to outsource at all, read our guide on the key reasons mental health professionals use an insurance billing service.

10 Questions to Ask Before Hiring a Mental Health Billing Service

1. What Is Your First-Pass Claim Rate, and How Fast Do You Post Payments?

Start with the track record. Ask every billing company for two numbers:

• First-pass (clean) claim rate: the percentage of claims paid on the first submission. A high rate means fewer denials, less follow-up, and a well-trained, knowledgeable billing staff. Aim for a partner that reaches 95% or higher.
• EOB posting time: how quickly payments are posted after your office scans EOBs. Anything longer than 24 hours is too slow for a competent mental health billing service.

Also ask how they handle the claims that do get rejected. A strong company tracks denial reasons, fixes the root cause, and appeals quickly. See the most common claim denials in mental health billing so you know what to ask about.

Good answer: “About 95% of our claims pass the first time, and we post EOBs within 24 hours of scanning.”

2. Do You Specialize in Mental and Behavioral Health Billing?

Many billing services cover the entire medical field, from primary care to chiropractic to mental health. When a team splits its attention across many specialties, its speed and accuracy on your claims can suffer. A company that focuses only on mental health billing knows the codes, the authorization rules, and the payer quirks because it is the only kind of billing it does.

Ask what share of their clients are therapists, psychologists, psychiatrists, and counseling groups, and whether they understand your licensure type and payer mix.

Good answer: “We bill only for mental health providers.”

3. How Much Do You Charge, and What Is Included?

Most mental health billing services charge a percentage of the insurance payments they collect. Some charge a flat fee per claim or a hybrid of the two. A double-digit percentage is usually a sign you are overpaying. At the other end, the very lowest rates often come from high-volume shops where you are treated as a number and customer service is thin.

Compare what each fee covers: claim submission, denial appeals, secondary claims, patient statements, eligibility checks, and reports. A low rate with extra charges for appeals can cost more than a fair rate that includes everything. For a full breakdown, read how much mental health billing services cost.

Good answer: A single, clearly stated percentage with no setup fees and no surprise add-ons. ePsych Billing, for example, operates at 4.75%.

4. Can I Trust You With My Practice and My Clients’ Data?

You are handing a billing company your revenue and your clients’ protected health information. Trust has to be earned with proof, not promises. Check four things:

• HIPAA compliance: the billing company is a business associate under HIPAA and must sign a Business Associate Agreement (BAA) with you.
• Data ownership: confirm in writing that you own your billing data and can take it with you if you leave.
• Reputation: read client reviews and ask for references from practices similar to yours.
• Access to leadership: can you speak with the owner or a senior manager when something goes wrong?

Transparency is a good sign. ePsych Billing owner Alex Trent shares free billing tips for mental health professionals on his YouTube channel, so you can judge his expertise before you sign anything.

5. Which Payers Do You Bill: Medicare, Medicaid, Commercial, and Telehealth?

Your billing partner should work with every payer your clients use. Government programs such as Medicare make up a large share of the claims billing companies process, and commercial plans, employer benefits, and marketplace plans each have their own rules.

Some providers wonder whether wider insurance coverage, or even universal healthcare, would make billing services unnecessary. The opposite is true. As long as a third party pays for care, whether private or government, someone has to submit, track, and appeal those claims. As coverage expands, the need for accurate mental health billing grows. The same goes for virtual care: ask how they code telehealth sessions, including place-of-service codes and modifiers.

Good answer: “We bill Medicare, commercial insurers, and telehealth claims every day, and we keep up with payer rule changes for you.”

6. Is There Any Upfront Risk or Long-Term Contract?

Some mental health billing services lock you into long-term contracts, charge setup fees, use sliding scales tied to your total revenue, or won’t let you try the service first. That puts all the risk on your practice.

Look for a billing company that offers a free trial, no upfront contract, and month-to-month service. If they are confident in their results, they don’t need to trap you. Ask as well how offboarding works: how much notice you must give, and how your data and open claims are handed back.

Good answer: “Try us free for 30 days. After that it’s month-to-month, and you can leave any time.”

7. Can’t I Just Do My Own Billing?

You can, and some solo clinicians do. But every hour spent on claims, denials, and payer phone calls is an hour you are not seeing clients or resting. Self-billing also tends to lead to more errors, slower follow-up, and missed appeal deadlines, which can mean common insurance billing challenges piling up unnoticed.

If you do choose to bill yourself, our mental health billing tips will help. If you are seeing signs your practice needs a mental health billing company, such as a growing stack of unpaid claims, it is time to outsource.

8. How Much Money Will I Actually Save?

By ePsych Billing’s estimate, a practice filing about 6,200 claims per year can save as much as $42,000 annually by outsourcing its billing. Savings come from three places: fewer denied and written-off claims, faster payments, and no cost of in-house billing staff.

To estimate your own savings, compare your current collection rate, days in accounts receivable, and total billing costs (software, staff time, and your own time) with what the billing service charges. Ask the company to walk you through this calculation for your practice.

9. Is a Billing Service Better Than Hiring Office Staff?

It depends on what you’re willing to manage. An in-house biller brings hourly wages or a salary, payroll taxes, workers’ compensation, insurance, benefits, sick days, training, and turnover. When that person leaves, your billing stops until you hire and train someone new.

A billing service spreads that work across a trained team, so coverage doesn’t disappear when one person is out. From a financial standpoint, outsourcing is usually the lower-cost option for small and mid-size practices. See the comparison table below.

10. How Often Will You Report to Me, and Who Is My Point of Contact?

Rule out any mental health billing service that doesn’t provide daily, weekly, and monthly reports. You should always know what was billed, what was paid, what was denied, and what is still outstanding, including insurance aging reports.

Be wary of a company that is hard to reach. Ask whether you get a named billing manager and how quickly they reply. At ePsych Billing, every practice is assigned a personal billing manager, and clients can call Alex directly with questions. Knowing your billing service is there for you is one of the most important, and most underrated, factors when shopping for a billing company. Learn more about our billing process and client support.

Red Flags When Choosing a Mental Health Billing Company

• They can’t or won’t share their first-pass claim rate or denial rate.
• They bill for every specialty and have few mental health clients.
• They require a long-term contract, setup fee, or cancellation penalty.
• They won’t sign a HIPAA Business Associate Agreement.
• Reports are monthly at best, or only sent when you ask.
• You can never reach the same person twice.
• Pricing is vague, or appeals and secondary claims cost extra.

Want a deeper checklist? Read about the 10 features that matter most in a mental health billing company.

In-House Billing vs. Outsourced Mental Health Billing

Checklist: What a Good Answer Looks Like

How ePsych Billing Answers These Questions

ePsych Billing was built by mental health specialists for mental health specialists. Here’s how we measure up:

• 95% of claims pass the first time.
• 24 hours: insurance payments are posted within 24 hours after your office scans EOBs.
• 4.75% flat rate.
• 30-day free trial, then month-to-month with no long-term contract.
• A personal billing manager, plus direct access to owner Alex Trent.

See our full list of mental health billing services, or contact us to start your free trial.

Frequently Asked Questions

How much do mental health billing services charge?

Most mental health billing services charge a percentage of the insurance payments they collect. Others charge a flat fee per claim. A double-digit percentage is usually too high. ePsych Billing charges 4.75%. Always confirm what the fee includes, such as denial appeals and secondary claims.

What is a good first-pass claim rate for mental health billing?

A strong mental health billing service should get about 95% or more of claims paid on the first submission. Lower rates mean more denials, more rework, and slower cash flow for your practice.

Is it worth outsourcing billing for a small or solo practice?

Often, yes. Solo and small practices usually can’t justify a full-time biller, and self-billing takes time away from clients. A billing service with a free trial and no long-term contract lets you test the value with little risk.

Does a mental health billing company need a HIPAA Business Associate Agreement?

Yes. A billing company that handles protected health information on your behalf is a business associate under HIPAA and should sign a Business Associate Agreement with your practice before it starts work.

Can I switch billing companies without losing money?

Yes, if you plan the handoff. Choose a new company that can take over open claims, make sure your current company returns your data, and avoid contracts with cancellation penalties. Month-to-month terms make switching much easier.

What is the difference between a general medical billing company and a mental health billing service?

A general medical billing company handles many specialties. A mental health billing service focuses only on behavioral health, so it knows time-based psychotherapy codes, authorization requirements, and telehealth rules, which usually leads to fewer denials and faster payments.

How can a billing company reduce claim denials?

By verifying eligibility and codes before submitting, tracking why claims are denied, fixing the root cause, and appealing quickly. Learn more about how a mental health billing company helps reduce claim denials.