Best Medical Billing Software of 2026

What is medical billing software?

Medical billing software is used by healthcare providers to automate their manual billing tasks, such as verifying patients’ insurance, processing and submitting claims, processing payments, and following up on denied claims. The software helps providers increase their collections by avoiding repetitive and cumbersome administrative tasks.

The software can be purchased either as a standalone system; as an integrated part of an electronic health records (EHR) solution; or as an integrated part of a practice management suite.

Medical billing software automates repetitive and error-prone billing tasks. It helps medical offices:

• Increase collections

• Code claims properly

• Verify patients’ insurance coverage

• Post payments and EOBs

• Provide reports on collections and rejections

Claim Status Dashboard in MediTouch by HealthFusion

There are hundreds of computerized medical billing systems on the market and they range from functionally simple to very sophisticated. The most basic systems help providers generate paper statements based on demographics and billing codes input by the user. Additionally, medical office billing software allows providers to submit claims electronically, scrub claims, post payments, pull advanced reports and more.

In this guide we discuss the following:

What is Medical Billing Software?

Common Features of Medical Billing Software

What Type of Buyer Are You?

Benefits of Medical Billing Software

Medical Coding Software

Cost and Return on Investment

Important Considerations

Popular Medical Billing Software Comparisons

Common Features of Medical Billing Software

When comparing different medical billing software, it’s helpful to have an understanding of the common features offered with this software. Here are some of the features you can typically expect in a medical billing system:

What Type of Buyer Are You?

Most practices we speak with match one of these common buyer types:

Inpatient care providers. This category of buyer includes hospitals and long-term care facilities that need to submit claims using UB-04 forms. This type of form typically requires a system designed for inpatient billing, although some outpatient healthcare billing software systems do have a module for UB-04 billing.

Outpatient care providers. This category is made up of the private practices that submit claims on the CMS-1500 forms. These buyers need to submit electronic claims to Medicare, Medicaid and private insurance companies using Medicare billing software/Medicaid billing software. Software needs do not vary much by size of organization, although larger organizations will need a more robust, scalable medical insurance billing software program.

Specialists. Specialists such as chiropractors, naturopathic doctors and mental health providers of varying designations typically see patients that pay directly via cash or credit card. Moreover, their patients typically do not submit many (if any) claims to insurance companies or government payers. As a result, these providers have more lightweight needs.

Outsourced billing services. These buyers are third-party companies that submit claims on behalf of providers. They are typically paid a percentage of collections by providers. They have similar functional requirements to their respective provider clients, but may require a very broad, flexible system if they bill for clients of varying specialties or types of care.

Integrated suite buyers. These buyers require billing functionality, but would rather implement one integrated suite for scheduling and EMR. Their vendor selections are often driven by the EMR functionality, since most integrated systems are differentiated by their EMR offering, not their billing modules.

Benefits and Potential Issues

Billing software is an integral part of the overall revenue cycle management process. Billing and other administrative tasks are notoriously paper-laden and cumbersome. A modern medical billing software system allows billers to be as efficient as possible at coding, submitting and following up on claims.

Moreover, staff will find that medical billing and coding software helps them code claims accurately to avoid errors. As a result, most providers find their collection rates increase when going from manually submitting claims to using medical claim software.

Finally, advanced reporting tools typically provide insights that are tough to gain without a medical billing solution. By collecting important data around claims and payers, such as which claims get rejected most often and which payers pay the slowest, providers can make data-driven decisions to improve collections.

Most practices and billing services we speak with face a common set of billing challenges, and consequently, they’re considering purchasing (or replacing) software to address those challenges. Here are common scenarios we often hear about during our phone consultations:

Transitioning from paper claims. Typically, solo or small practices are making the move from paper claims to an electronic system (though that is not always the case). They have a difficult time keeping track of patients and who owes what. They will implement medical billing software for the first time to reduce paperwork, track all data in a central place and improve efficiency overall.

Bringing billing in-house. Another common scenario, most practices choose to bring billing in house—as opposed to outsourcing to a third-party service—to cut costs, have more control of their billing and accounts receivable and get everything centrally located.

Replacing antiquated software. Finally, offices replacing their existing system do so because it’s outdated and expensive to maintain, it doesn’t meet their technical requirements (e.g., integration with electronic medical record software) or they have a difficult time using it. In this scenario, Web-based medical billing software is an attractive option because it’s modern and easy to use, costs less up front and updates automatically as vendors release new versions and enhancements.

Medical Coding Software

Many medical billing software solutions include functionality that enables HIPAA-compliant medical coding. Users can enter procedure and diagnosis codes and even look up codes online to find the correct ones. This capability allows users to file and track claims more easily and helps in the tracking of data over time. Many medical billing software solutions will also update codes automatically to ensure the accurate ones are always being used. 

Costs and Return on Investment

The prices of medical billing software programs often depend on the application’s deployment model. On-premise systems will require upfront costs for licenses, servers and other necessary hardware, setup and training. Buyers of on-premise systems will also need to pay ongoing maintenance and support fees, which are typically 15-20 percent of the upfront licensing costs.

Software-as-a-Service (SaaS) applications typically require lower upfront costs and ongoing monthly fees that cover licensing, support and upgrades. Finally, there are free medical billing software options that are supported by alternative revenue streams, such as advertising.

Most buyers who have successfully implemented systems will be able to generate returns on their investments through improved accuracy of filings, improved billing efficiency, and subsequently, increased collections.

Collections Management in Kareo speeds payment

Important Considerations

Integrated suites vs. stand-alone billing solutions. Buyers will need to decide if they want to implement a standalone system, a system integrated with patient scheduling (typically called “practice management”) or a fully integrated billing, scheduling and electronic medical records (EMR) system. Many vendors such as AdvancedMD and NueMD offer all three options. Medical billing solutions have long been the only or primary applications used in many doctors’ offices, and they are usually the first systems new practices will implement. Despite government legislation requiring the adoption of EMRs, we still hear from many practices looking for standalone billing or practice management systems.

On-premise vs. Web-based. SaaS or Web-based medical billing systems have become very popular and comprise well over 50 percent of new solution sales. Low upfront costs, greater accessibility and little to no IT requirements are contributing factors to so many buyers preferring Web-based systems. Assuming buyers have reliable Internet access, we typically recommend they consider these programs.

Security. A primary concern we hear from buyers regards data security. Since medical billing involves the storage and transmission of so much sensitive patient data, buyers will want to make sure they implement a secure system. Vendors are well aware of this need and offer HIPAA-compliant systems.

User adoption. Usability tends to be more a function of the end user and how the system is configured than the medical claims software itself. Users with medical experience can typically adopt most systems quickly. Many complaints regarding usability tend to be related to setup and maintenance of servers and other hardware, not the applications themselves.

Popular Medical Billing Software Comparisons

• NextGen Office vs athenahealth EHR

• AdvancedMD vs DrChrono EHR

• Kareo Billing vs NueMD

• Practice Fusion vs NextGen Office

• CareCloud vs EClinicalWorks