Onshore Vs. Offshore Medical Billing – Which is Better?

Outsource medical billing

When you decide to outsource medical billing, the two most popular options are – onshore and offshore medical billing. As the name suggests, ‘onshore’ refers to US-based medical billing companies, and ‘offshore’ refers to medical billing companies outside the US. The critical decision of which medical billing outsourcing model suits your healthcare enterprise—onshore or offshore medical billing, must be made with a clear understanding of the pros and cons of each model.

Keep reading as we delve further into the pros and cons of onshore versus offshore medical billing.

Pros and Cons of Onshore Medical Billing

The apparent advantage of onshore medical billing is the ease of transition. You are likely to deal with people who may be in the same time zone, are bound by the same legal framework and healthcare regulations (especially regarding HIPAA compliance), and speak the same language. However, on the flip side, with an onshore medical billing model, you may not make significant strides in lowering the process cost, and scaling the business model may be more challenging.

5 Advantages of Onshore Medical Billing

  • Quality Assurance: Onshore medical billing services often have high-quality assurance standards due to their adherence to local regulations, familiarity with domestic billing practices, and easier oversight by healthcare providers.
  • Communication: Onshore medical billing teams typically share the same language, culture, and time zone as the healthcare provider, minimizing communication barriers and enhancing collaboration and responsiveness.
  • Regulatory Compliance: Onshore medical billing services are subject to local regulatory frameworks, such as HIPAA in the United States, ensuring compliance with healthcare privacy laws, billing regulations, and coding standards.
  • Patient Confidence: Patients may feel more comfortable knowing that their medical billing is handled domestically, potentially increasing trust and confidence in the healthcare provider’s commitment to privacy, security, and ethical billing practices.
  • Job Creation: Utilizing onshore medical billing services creates domestic employment opportunities and supports local economies and communities.

5 Disadvantages of Onshore Medical Billing

  • Higher Costs: Onshore medical billing services often have higher labor costs than offshore alternatives, leading to higher operational expenses for healthcare enterprises.
  • Longer Implementation Time: Due to higher costs and competition for skilled medical billing professionals in the US, onshore medical billing services may have higher implementation lead times than offshore options.
  • Flexibility in Scaling Operations: Scaling onshore medical billing operations to accommodate fluctuations in patient volume may be more challenging and expensive (than offshore alternatives), particularly during peak periods or rapid growth phases.
  • Geographic Limitations: Onshore medical billing services tend to be geographically focused on serving specific states.
  • Lower Service Promptness: Onshore medical billing companies usually have the same working hours as their clients in the US. In comparison, offshore medical billing companies can process claims faster due to the time difference. For instance, the claims submitted by evening by a US healthcare enterprise are processed by an India-based medical billing service the following morning due to the time difference of 9 hours.

Pros and Cons of Offshore Medical Billing

Offshore medical billing companies (especially those based in South Asia) offer many advantages to overcome the limitations of onshore medical billing.

5 Advantages of Offshore Medical Billing

  • Access to Skilled Workforce: Offshore medical billing companies typically employ highly skilled professionals trained in medical billing and coding. Some offshore medical billing companies have in-house recruitment and training programs, which makes skilled resources more readily available.
  • 24/7 Operations: Offshore medical billing companies may operate in different time zones, providing round-the-clock services that lead to faster turnaround times for billing processes.
  • Scalability: Offshore medical billing services can be easily scaled up or down based on the healthcare enterprise’s needs, offering flexibility in resource allocation.
  • Cost Savings: A significant advantage of offshore medical billing is cost savings. Offshore providers often offer services at a lower cost due to lower labor and operational expenses in their respective countries. Also, the currency exchange rate works in favor of the US dollar.
  • HIPAA compliance regarding patient data security: Most offshore medical billing companies have invested in data security and state-of-the-art IT infrastructure to safeguard against cyber-attacks and ensure compliance with HIPAA standards.

5 Disadvantages of Offshore Medical Billing

  • Quality Concerns – A common concern when hiring an offshore medical billing company is the quality of service provided. The fear is that the company will not deliver the required standards of medical coding accuracy and adherence to healthcare regulations.
  • Communication Challenges: Differences in time zones, language, and culture can sometimes lead to communication challenges between offshore billing providers and their clients, potentially causing delays or misunderstandings.
  • Data Security Risks: Offshore medical billing involves sharing sensitive patient data with third-party providers, which raises concerns about data security and compliance with regulations such as HIPAA (Health Insurance Portability and Accountability Act).
  • Regulatory Compliance: Healthcare regulations vary between countries, and an inexperienced offshore provider may not always be fully versed in the rules governing medical billing in the client’s country. Any such lapses can lead to compliance issues and potential legal liabilities.
  • Dependency on External Providers: Outsourcing medical billing means relying on external providers for a critical aspect of the healthcare revenue cycle. The absence of a local billing company team may cause added stress for the client.

Important  Note – You must not view the disadvantages of offshore medical billing in isolation. The lower billing cost, ease of process scalability, and faster processing are solid arguments for offshore medical billing. The emergence of cloud-based billing software has made working with an offshore medical billing partner as seamless as working with a local team.

Daily, weekly, and monthly reporting of claims processed and pending ensures you have complete control of your revenue numbers (including accounts receivable). Offshore medical billers usually have dedicated in-house IT teams to safeguard digital assets.

Get the Best of Both Onshore & Offshore Medical Billing with PracticeForces

Choosing a billing service with a local presence further mitigates any risk associated with offshore medical billing. PracticeForces is a US medical billing company that has successfully delivered revenue boosts to healthcare enterprises since 2003. We have medical billing teams in the US and India to leverage the advantages of both onshore and offshore medical billing for our clients. Our experienced medical billing team, based in Clearwater, Florida, collaborates closely with our clients to deliver the revenue boost they seek. Our India team supports our client successes with faster claims processing and quick scalability.

Would you like to know how we can boost your revenue collections? Please feel free to contact us for a complimentary consultation.


Parul Garg, CEO and co-founder of PracticeForces, has significantly contributed to the growth of over 1,000 U.S. medical practices through her expertise in medical billing and coding since the company’s inception in 2003. With a background in Computer Science and an MBA in Human Resources, her leadership and AAPC-certified coding skills have been pivotal in managing the company’s operations effectively.

Related Posts


Do you want to streamline your reimbursements?

Subscribe for actionable tips and insights to grow your medical practice >

Call Now Button