Understanding the Billing Staff-to-Provider Ratio in Medical Practices

What is the right billing staff to provider ratio in a physician practice?

Running a successful medical practice requires more than quality patient care. Behind the scenes, billing staff keep revenue flowing and ensure compliance with complex payer requirements. One critical element of medical practice management is maintaining the right billing staff-to-provider ratio, especially as practices grow in size and complexity.

Why Billing Staff Ratios Matter

In every practice—whether small or a large practice for medical billing—the number of billing professionals relative to physicians impacts efficiency, accuracy, and revenue collection. Too few staff can lead to delayed claims, errors, and lost income. Too many, and overhead costs rise unnecessarily.

The PC ratio in medical billing (provider-to-collector ratio) helps practices balance these concerns. It measures how many billing professionals are needed to support each physician while maintaining strong performance metrics.

Benchmarks for Large and Small Practices

For a solo or small group practice, one or two billing staff may be sufficient. But as you move into a medical billing large size practice, ratios change. Larger groups typically require specialized roles, such as payment posters, denial management experts, and coding specialists.

A general benchmark is one billing staff member per two to three providers. However, this number shifts based on:

• Specialty and complexity of coding

• Volume of claims and payer mix

• Use of outsourced billing services

• Practice goals for cash flow and days in A/R

The key is measuring not only staffing ratios but also the quality and efficiency of your medical practice billing operations.

Calculating Physician and Billing Staff Full-Time Equivalents (FTEs)

 Accurately calculating your practice’s staff-to-provider ratio requires precise FTE calculations for both physicians and billing staff. Here’s how to do it correctly: 

1. Physician FTE Calculation: Instead of counting each physician individually, you need to calculate physician full-time equivalents (FTEs). To do this, divide the total number of patient encounters performed during the past year by the average number of yearly encounters per physician. This number typically ranges from 3,600 to 4,800, depending on the specialty. For instance, primary care physicians usually reach the higher end of this range, while single surgical specialists may fall on the lower end. This method accounts for part-time physicians and those with less-than-full-time schedules.
   
2. Billing Staff FTE Calculation: Define an FTE as an employee who worked 2,080 hours over the past year (40 hours per week × 52 weeks). This calculation should include all personnel involved in the physician revenue cycle, such as data entry, coding, payment posting, accounts receivable follow-up, and patient statement processing. 

Here’s an example calculation: 

For the year ending June 30, 2024: 

- Billing Staff Employee 1 worked 2,080 hours = 1.0 FTE (2,080/2,080) 

- Billing Staff Employee 2 worked 1,720 hours = 0.83 FTE (1,720/2,080) 

- Billing Staff Employee 3 worked 1,500 hours = 0.72 FTE (1,500/2,080) 

- Dr. Koch performed 1,800 encounters = 0.5 FTE (1,800/3,600) 

- Dr. Sjogren performed 3,600 encounters = 1.0 FTE (3,600/3,600) 

Total Billing Staff FTE count = 2.55 (1.0 + 0.83 + 0.72) 

Total Physician FTE count = 1.5 (1.0 + 0.5) 

Thus, the physician-to-billing staff ratio is 1.70 (2.55/1.5). 

Utilizing Benchmark Ratios to Improve Revenue Cycle Management

According to the Medical Group Management Association (MGMA) in its 2008 publication, *Benchmarking Success – The Essential Guide for Group Practices*, the benchmark ratio is approximately 2.7 billing staff per physician. This figure is an average derived from various specialties and does not account for specific practice sizes or other variables. Nonetheless, it serves as a useful starting point for evaluating your practice's efficiency. 

Staffing Models and Technology’s Role

Today’s practices have more options than ever when it comes to structuring their billing departments. Some maintain a fully in-house team, while others adopt a hybrid model—outsourcing certain functions, such as denial management, while keeping coding and charge entry internal.

Technology also plays a major role. Advanced practice management systems, electronic health records (EHR), and automated claim scrubbers can reduce the need for manual work. However, technology cannot replace skilled billing professionals—it simply allows them to handle more volume with greater accuracy.

Physician Medical Billing and Efficiency

For physicians, billing performance directly affects revenue and financial stability. Practices that track KPIs—such as net collection rate, first-pass resolution rate, and days in A/R—are better able to evaluate if staffing ratios are sufficient.

At Reed Tinsley, we work with practices to identify gaps in physician medical billing, assess performance against industry standards, and recommend improvements that maximize revenue without inflating costs.

Finding the Right Balance with Practice Management Support

Ultimately, the billing staff-to-provider ratio is just one element of effective medical practice management. Practices also need strong workflows, technology systems, and regular reviews of financial performance.

If your practice is struggling with denied claims, high A/R, or unclear staffing needs, it may be time to assess whether your billing team is aligned with benchmarks for your specialty and size.

As a medical practice brokerage and CPA + consultant for physicians, Reed Tinsley provides the financial insights and operational support practices need to thrive.

Key Takeaways

• One billing staff per two to three providers is a common benchmark, but ratios vary by specialty, volume, and payer mix.

• Larger practices often require specialized billing roles and more complex staffing models.

• Technology can improve efficiency but cannot fully replace skilled billing professionals.

• Monitoring KPIs such as net collection rate and days in A/R ensures ratios are aligned with performance goals.

• Practices should reassess staffing needs regularly as patient volumes, specialties, and technology evolve.