What happens to A/R when you switch billing companies?
When a practice switches billing companies, the claims already submitted but not yet paid usually lose their owner: the outgoing vendor stops working them once notice is given, and the incoming vendor is paid on new charges. Unless the transition agreement assigns responsibility for the run-out A/R, those claims age until they cross payer deadlines.
The three ways run-out A/R is handled
| Arrangement | What happens | Typical result |
|---|---|---|
| Outgoing vendor keeps the run-out for a fee | Old vendor works claims in flight for 60–120 days | Works if the vendor is motivated; often tapers off after 30 days |
| Incoming vendor takes everything | New vendor inherits the old queue in an unfamiliar system | Old claims get lowest priority; new charges pay the vendor |
| Nobody is assigned | Claims sit in the retired system | Balances age silently until the old system contract ends |
Why the run-out queue decays fast
Claims in flight on the transition date include denials waiting for appeal and records requests waiting for a response. Medicare's redetermination window is 120 days from the initial determination (CMS); commercial appeal windows are commonly 60–180 days. A queue that goes untouched for the 60–90 days a transition typically takes will lose a meaningful share of its denials to appeal deadlines before anyone opens it.
What to put in the transition agreement
- Who owns run-out claims, for how long, and at what fee. Contingency on recovered dollars aligns the old vendor better than a flat monthly fee.
- Read-only access to the old system for the practice and the successor for at least 12 months, matching Medicare's one-year filing limit (CMS).
- A claim-level export of open A/R on the transition date, with last-action notes, denial codes, and clearinghouse acceptance reports (the proof of timely filing).
- Remittance handling: 835s and EOBs for old claims must still reach whoever is working them.
- A BAA with every party that touches the claim data (HHS).
If the switch already happened
Pull the open insurance A/R from the old system by claim, with dates of service and last action. Sort by deadline. Anything with a filing or appeal limit inside 30 days is worked immediately; anything with no follow-up notes is verified with the payer, because a share of it was never received. Then hand the queue to a dedicated owner. A contingency recovery firm is a common choice because it is paid only on what it recovers and does not compete with the new vendor for current claims. See legacy A/R cleanup.
Sources
- CMS, Original Medicare (fee-for-service) appeals: five levels; redetermination within 120 days, reconsideration within 180 days
- CMS, Medicare timely filing requirements: claims must be filed within one calendar year of the date of service
- HHS, HIPAA for professionals (business associates and permitted uses)
Figures attributed to a source are that source's; commonly used benchmarks are labeled as such. Verify deadlines against your own payer contracts.
Related articles
Related services
- Legacy A/R recovery — Receivables stranded by a billing-company change, EHR migration, or acquisition.
- For billing companies — White-label, revenue-share, or referral partnerships for billing and RCM companies.