Would licensing medical billers strengthen the fight against health care fraud?

Health care fraud and negligence remain two of the most persistent and costly challenges facing physicians today. The National Health Care Anti-Fraud Association estimates that fraud drains tens of billions of dollars from the health care system every year. Some federal agencies place the figure as high as 10% of total health care spending — potentially exceeding $300 billion annually.

The consequences hit independent practices especially hard. Fraud drives up premiums, triggers unnecessary audits, exposes patient information to risk, and erodes trust between physicians and payers. Meanwhile, dishonest clinicians and organized criminal groups exploit weaknesses in oversight and claims processing systems.

Here’s a gap that rarely comes up in policy discussions: Medical billers who prepare and submit claims to payers aren’t required to be licensed in any state. In an industry where nearly every function touching patient care is regulated, the absence of oversight for billing professionals is both striking and risky. Billers are the frontline personnel who must prevent fraud — they know from experience all the tricks.

So, would licensing medical billers actually make a difference in reducing fraud and improving billing integrity? The evidence suggests yes, and primary care physicians stand to benefit directly.

How fraud works and where billers fit in

The National Health Care Anti-Fraud Association outlines dozens of fraudulent schemes that physicians encounter:

• Billing for services that were never performed.
• Upcoding to inflate reimbursement.
• Submitting medically unnecessary procedures.
• Falsifying diagnoses and modifiers.
• Misrepresenting cosmetic procedures as medically necessary.
• Identity theft to create fictitious patient records.
• Unbundling procedures that should be billed together.
• Accepting kickbacks or manipulating copay rules.

These schemes often originate with dishonest clinicians or criminal entities, but here’s the thing — the claim can’t be submitted or paid until someone processes it. That means analyzing documentation, choosing codes and entering charges into the billing system.

The biller’s role is a critical checkpoint. Yet because billers aren't required to hold licenses or complete standardized training, their ability to detect fraud or stop inappropriate claims varies wildly. Recent high-profile cases show how easily untrained or complicit billing staff can facilitate massive fraud schemes.

For independent primary care physicians, this creates real vulnerabilities. A small practice might have one or two billing staff members handling thousands of claims annually. If those individuals lack proper training in fraud detection or feel pressured to submit questionable claims, the practice faces audit risk, denial rates and potential legal exposure.

How licensing could strengthen the billing industry

The financial and political logic

The financial case for licensing is compelling. With hundreds of thousands of medical billers operating nationwide, licensing and accreditation fees could generate billions of dollars in revenue. This isn’t just about regulation — it’s about creating a self-sustaining system where fees fund robust oversight and fraud prevention programs. For legislators facing pressure to reduce health care waste without raising taxes, billing licensure offers a politically attractive solution: enhanced program integrity that pays for itself while reducing fraudulent claims that cost taxpayers far more.

Establishing a standard of professional competence

Right now, anyone can call themselves a medical biller regardless of training. Licensing or accreditation with government entities like Medicare and Medicaid programs would change that by introducing formal education requirements; mandatory training in fraud, waste and abuse; standardized coding and documentation instruction; regulatory and compliance knowledge; and continuing education to keep pace with payer rule changes.

This creates a consistent baseline similar to what we see in other regulated health professions. For primary care physicians running independent practices, it means knowing that the person handling your billing meets necessary professional standards — something you can’t assume today.

Increasing accountability and oversight

Health care billing affects federal programs like Medicare and Medicaid, private insurers and patients’ financial responsibility. The consequence of losing licensing/accreditation would make billers accountable to a regulatory body, bound by a professional code of ethics, required to follow payer rules and subject to disciplinary mechanisms for misconduct.

This level of accountability would deter negligent or fraudulent behavior and underscore the seriousness of the billing function. When your practice faces an audit, you want confidence that your billing staff followed proper protocols.

Empowering billers to identify and prevent fraud

Many billers encounter questionable documentation or coding patterns but feel pressured by productivity quotas, fear of job loss, employer demands to maximize revenue or workplace cultures that discourage questions. They lack the authority to raise concerns effectively. Billing staff who spot red flags often don’t know how to escalate them or fear retaliation for speaking up.

Licensing and accreditation could clarify billers’ responsibilities in preventing fraudulent submissions, strengthen their position to refuse improper coding requests, provide protections when reporting irregularities and encourage earlier detection of fraud schemes. A licensed professional is more likely to question inconsistencies — and better equipped to escalate them appropriately.

For physicians, particularly those in evaluation and management coding, where upcoding remains a persistent problem, having a licensed biller means an extra layer of protection against compliance violations.

Reducing fraudulent billing operations

Some fraud schemes are run by independent billers working alone or in small groups who fabricate claims using stolen provider identities and patient information. These solo operators are particularly difficult to track because there’s no credential verification system for billers.

Licensing and accreditation would make it harder for fraudulent billers to operate undetected by allowing payers to verify who is actually submitting claims. Currently, providers must enroll and prove they’re authorized to provide specific services — but the billers submitting claims on their behalf face no such requirements. Licensing would extend this verification to billing professionals and create consequences for unauthorized activity, closing a gap that criminals now exploit.

Elevating medical billing as a recognized health care profession

Billing often gets dismissed as clerical work, but anyone who’s dealt with a complex denial knows better. Medical billing is a compliance-driven, high-stakes function that directly affects provider practices’ financial health.

It impacts reimbursement accuracy, legal exposure, audit outcomes, patient satisfaction with billing and provider relationships with payers. Licensing would formally acknowledge the sophistication required for this work and create a pathway for more skilled professionals to enter the field, which benefits providers who rely on competent billing staff.

Supporting broader fraud prevention infrastructure

Antifraud efforts involve coordination across federal agencies like the Centers for Medicare & Medicaid Services and the Department of Health and Human Services Office of Inspector General, Department of Justice Strike Forces, private payer Special Investigations Units, health system compliance departments, and professional organizations such as the American Academy of Professional Coders and the Healthcare Business Management Association.

Licensed and accredited billers could integrate more effectively into these systems through required fraud training, standardized documentation expectations, clear reporting pathways and cross-industry collaboration. This would align the billing workforce with national fraud prevention priorities and make the entire system more responsive to emerging threats.

Limitations — and why licensing still matters

Will licensing billers eliminate fraud entirely? No. Fraud driven by falsified medical records, unnecessary procedures ordered by clinicians or deliberate collusion requires enforcement at the clinical or organizational level.

But licensing would significantly reduce fraud that relies on untrained or complicit billers, create barriers for criminal billing enterprises, improve claim accuracy, increase legitimate revenue for providers and government programs, reduce costly submission errors, strengthen relationships between physicians and payers, and improve data quality across the system.

Is it a silver bullet? No. Is it a practical, structural improvement that would strengthen the entire industry? Absolutely.

What this means for primary care physicians

For independent practices, especially, licensing medical billers could translate into measurable benefits. Studies suggest that proper billing training and oversight can reduce denial rates by 10% to 15%. That’s significant when you consider that every denied claim means staff time spent on appeals and delayed revenue.

Licensed billers would also be better positioned to keep up with the constant changes in payer policies, coding updates and compliance requirements — reducing your practice’s exposure to audits and penalties. And in an environment where physician burnout is tied partly to administrative burden, knowing your billing operation meets professional standards is one less thing to worry about.

What this means for payers and government programs

For Medicare, Medicaid and private insurers, licensing breaks a destructive cycle: Payers spend billions on fraud investigation and cut fee schedules to offset losses; providers seek ways to maximize revenue through aggressive billing, triggering more audits and deeper cuts. Administrative costs escalate while trust collapses.

Licensing and accreditation reduce pressure to slash reimbursement rates while generating billions in licensing fees. When payers can trust claims, providers receive fair payment, and government authorities gain both the revenue and the tools to prevent fraud rather than just punish it. The system shifts from perpetual suspicion to one built on professional standards — fixing what’s fundamentally broken.

What’s next for billing reform

Health care fraud is complex and multilayered. No single intervention will solve it. But licensing medical billers stands out as a practical, scalable step that would professionalize a vital part of the health care workforce; reduce vulnerabilities that fraudsters exploit; increase accountability and competency across the billing sector; enhance early detection of fraudulent activity; and protect patients, physicians and payers alike.

As a long-standing participant in the revenue cycle management field, I strongly believe that licensing medical billers is a crucial next step for the health care industry. Licensing would strengthen compliance, elevate professional standards, and play a meaningful role in reducing health care fraud across both government and commercial health care programs. When billers are officially accredited or licensed through the program, payers gain verifiable confidence in claim integrity. This trust translates into tangible benefits — higher reimbursement rates, faster claim processing and reduced audit frequency for providers who use credentialed billing professionals.

As health care continues to evolve, the industry needs to raise standards for everyone who plays an essential role in its financial and compliance infrastructure. Licensing medical billers is one reform that could measurably improve quality, protect public resources and help ensure the sustainability of the health care system for years to come.

Olga Khabinskay is the director of operations at WCH Service Bureau Inc. With more than 23 years of experience in health care revenue cycle management, she specializes in medical billing, revenue compliance and payer contract evaluations, helping provider organizations reduce denials, strengthen collections and make smarter network decisions. She is currently developing a Trusted Biller Program to present to CMS and the New York State Medicaid Program, aimed at establishing standards that enhance billing accuracy, transparency and payer-provider trust.