The Current Landscape
Provider organizations face a myriad of challenges: staffing shortages, rising self-pay volumes and a complex payer mix to name several. It’s not uncommon for bills to go out the door only to never be seen let alone paid for again. One study found that the mean repayment rate for patients with private insurance decreased from 54% in pre-pandemic years to 46% by 2023. Many senior-level leaders are tasked with the decision to buy or build. Should they handle Early-Out capacity in-house, or partner with a specialized third-party to lighten the load?
The right answer isn’t about control. It’s about which model delivers consistent recovery at a predictable cost. Here’s how the two stack up.
In-House Early-Out: What It Actually Takes
A great indicator of whether or not your in-house Early-Out team is hitting the mark comes down to Cost-To-Collect. CTC matters because it’s essentially a combination of costs associated with staffing, technology and any overhead costs required to collect the money that is owed to a hospital or health system.
HFMA’s best-practice benchmark for CTC is 2%, meaning consistently operating well above that level can signal inefficiency. Think coding errors, high denial rates and slow Accounts Receivable (AR) follow-up. To keep CTC at or below the national average, you need an experienced team who is committed to efficiently collecting what is already owed without seeing a single additional patient.
A Highly Trained Staff
Unfortunately, finding staff members who are committed to staying is equivalent to procuring a diamond in the rough. Between evolving regulations, need for revised call center scripts and disgruntled patients, it’s easy to see why the turnover rate for staff is high. Additionally, it takes on average six weeks (at least) for reps to become trained enough for minimal independent work, and up to a year for full proficiency and accuracy. So, any time someone resigns you’re essentially starting back to square one.
A Sophisticated System
Beyond staffing, healthcare organizations often underestimate the technology required to maximize Early-Out performance. Today’s patient collections environment demands far more than a basic phone system. It requires an enterprise-grade contact center platform with intelligent call routing, IVR, integrated SMS and email, call recording, payment processing, workforce management, and robust reporting.
Success also depends on advanced analytics that prioritize accounts based on payment propensity, balance characteristics, and aging, along with sophisticated statement delivery, digital payment tools, insurance discovery resources, and seamless integration with the hospital’s EHR and financial systems.
Finally, every outreach strategy must comply with an increasingly complex web of federal and state regulations, HIPAA requirements, TCPA, and evolving patient communication standards. Together, these investments in technology, compliance, and expertise represent a significant commitment that many health systems find difficult to replicate while maintaining best-in-class performance.
While an in-house team seems like an advantage (i.e. more direct control), it’s oftentimes at the expense of flexibility, speed, compliance and predictable ROI.
Outsourcing Early Out
Hospitals and health systems routinely rely on strategic partners for specialized expertise—from coding and transcription to environmental services and IT. Increasingly, revenue cycle leaders are taking the same approach with Early-Out programs, recognizing that success depends on more than simply adding staff. It requires the right combination of technology, specialized talent, operational discipline, and consistent performance oversight.
The question isn’t whether outsourcing has a place in healthcare. It’s which revenue cycle functions create the greatest strategic value when managed by a specialized partner with the expertise, technology, and accountability to consistently deliver results. As financial pressures continue to mount, early out has become one of those opportunities.
The greatest advantage of outsourcing isn’t giving work away—it’s gaining flexibility. A well-designed Early-Out partnership allows organizations to scale with fluctuating patient volumes, reduce the burden of recruiting and training specialized staff, and maintain consistent performance without expanding internal overhead. It also enables internal revenue cycle teams to focus on higher-value priorities while ensuring patient accounts continue moving efficiently through the revenue cycle.
Of course, not every outsourcing relationship delivers the same results. The most successful partnerships operate as an extension of the health system—not as a separate vendor. That means shared goals, transparent reporting, clearly defined performance metrics, and regular collaboration to continuously improve outcomes. HFMA identifies governance, accountability, measurable service levels, and strong communication as essential ingredients for successful revenue cycle outsourcing relationships.
The right partner should operate as an extension of your organization—not simply another vendor. At Revenue Enterprises, that’s the philosophy we’ve built our organization around. Every patient interaction is treated as an extension of our client’s brand, supported by compassionate financial conversations, data-informed outreach strategies, rigorous quality assurance, and transparent performance reviews. Because success isn’t measured solely by dollars collected—it’s measured by preserving the patient relationship while helping healthcare organizations improve cash flow, reduce downstream bad debt, and create a stronger financial experience from the very beginning of the revenue cycle.
Early-Out isn’t simply about collecting balances sooner. It’s about engaging patients while financial conversations are still collaborative rather than reactive. When patients receive timely, clear, and compassionate communication early in the billing journey, providers have a greater opportunity to resolve balances before accounts age into collections. The result is more than improved cash flow—it strengthens the patient financial experience while reducing downstream bad debt, creating better outcomes for both patients and health systems.
The ROI Case: Buy vs Build
Healthcare organizations don’t have the luxury of waiting for margins to improve on their own.
Kaufman Hall’s most recent National Hospital Flash Report, found that the median operating margin remained just 2.5% through April 2026, while bad debt and charity care increased between 22% and 36% year over year across nearly every hospital size. Since 2023, those expenses have climbed by an estimated 30% to 60%, creating additional financial pressure on already constrained organizations.
Moral of the story? When every percentage point matters, improving collections earlier in the revenue cycle becomes more than an operational initiative—it becomes a financial strategy.
Building an internal Early-Out team requires ongoing investments in recruiting, training, technology, analytics, compliance, quality assurance, leadership oversight, and workforce management. Those expenses don’t disappear when call volumes fluctuate or staffing challenges arise. Partnering with an organization that specializes in Early-Out services allows health systems to access experienced teams, established workflows, and proven technology without carrying the full operational burden internally.
A well-executed Early-Out program helps organizations recover more balances before accounts age, reduces downstream bad debt, improves cash flow, and allows internal revenue cycle teams to focus on higher-value work that requires their expertise. The return isn’t simply measured in dollars recovered. It’s reflected in greater operational efficiency, stronger patient engagement, and the ability to achieve more without expanding internal resources.
When Does Outsourcing Make Financial Sense?
There is no one-size-fits-all approach to an Early-Out program. However, several common operational and financial indicators suggest it may be time to evaluate whether partnering with a specialized provider could strengthen your revenue cycle strategy.
- Self-pay or underinsured balances continue to grow.
- Staffing shortages or turnover are limiting internal capacity.
- Aging accounts are slowing cash flow.
- Leadership needs scalable support without adding permanent headcount.
- Patient financial engagement has become a strategic priority alongside financial performance.
Your internal team is still your internal team. Outsourcing doesn’t replace your revenue cycle team. It empowers them to focus where their expertise creates the greatest value while a trusted partner provides the additional capacity, technology, and operational discipline needed to keep accounts moving forward.
It’s Not About Giving Up Control
The most successful outsourcing relationships aren’t built on handing work off—they’re built on working together.
Early-Out should feel like a seamless extension of your organization, supported by shared goals, transparent reporting, measurable outcomes, and a commitment to delivering a patient financial experience that reflects your brand and values.
As healthcare organizations continue balancing financial sustainability with compassionate patient care, the question isn’t whether every function belongs in-house. It’s where strategic partnerships can create the greatest impact—for your organization and for the patients you serve.
The buy-versus-build decision isn’t simply about reducing costs. It’s about determining where your internal teams create the greatest value—and where a trusted partner can provide the expertise, scalability, and operational consistency to strengthen your revenue cycle without compromising the patient experience. For many healthcare organizations, success isn’t determined by who performs the work—it’s determined by whether the work is performed consistently, compassionately, and efficiently.
If your organization is evaluating the financial and operational impact of building versus partnering for Early-Out services, we’d welcome the opportunity to start the conversation. Connect with Revenue Enterprises at Sales@RevenueEnterprises.com to explore how a patient-first approach to Early-Out can strengthen financial performance while supporting the experience your patients deserve.