Pricing Guide: Medical Billing Software

Category : Information Technology

Pricing Guide: Medical Billing Software

Three Common Pricing Models for Medical Billing Software

Perpetual License Billing Model

A perpetual license is the upfront sum that companies have to pay for the license to be able to own the software and use it, which is the more traditional model of billing software. It is mainly used with on-premise applications.

Subscription Billing Model

Subscription based billing software has a monthly fee that companies have to pay to get access to the software for a specified period of time. This method has gained popularity with the beginning of Software as a Service (SaaS).

Open Source Billing Model

Open source models have licenses which usually do not cost money and come free of charge. This ends up reducing upfront costs. When companies employ this billing model, the major expenses can be implementation, integration and ongoing maintenance.

Comparing Costs by Pricing Model

Perpetual License Costs

Upfront Costs

• Perpetual license fee • Customizations • Installation/setup • Integration with existing systems

Recurring Costs

• Maintenance (updates, patches & upgrades) • Premium support services

Subscription Costs

Upfront Costs

• Customizations • Installation/setup • Integration with existing systems

Recurring Costs

• Subscription fee • Premium support services

Free & Open Source Costs

Upfront Costs

• Customizations • Installation/setup • Integration with existing systems

Recurring Costs

• Maintenance (updates, patches and upgrades) • In-house or outsourced IT consultants

Total Cost of Ownership

Even though the cost of a perpetual license may be more upfront, the total cost of ownership actually matches that of the subscription packages in around seven to ten years.

Often Overlooked Costs

Data Migration

While data migration is a process that can be done in-house, companies usually want to pay their vendor itself to transfer data.

Training

Usually software applications come with web-based training included. The vendors still charge for in-person training.

Hardware & IT

Hardware and IT costs can become a big expense for companies that use on-premise software because they need their own servers.

Maintenance & Upgrades

Again, this is a big expense for those who use on-premise software buyers because they need their own servers.

Key Takeaways:

  • There are three main billing models for medical use
  • They can be on-premise or cloud based
  • The billing software can be purchased completely, used on a subscription basis or a free sourced option

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