Pricing Model Deep Dive

athenahealth Collections Percentage Model Explained

Instead of charging a flat monthly fee per user or per provider, athenahealth takes a cut of the money your practice actually collects. This unique model aligns their incentives with yours — but it also means your cost can vary significantly month to month.

How the Collections Model Works

1

You Provide Care

Services rendered to patients. Diagnoses coded, procedures documented in athenaOne EHR.

2

Claims Submitted

athenahealth's RCM team submits claims to insurance payers electronically within 24 hours.

3

Payments Collected

Insurance payers remit payment. athenahealth posts ERAs, manages denials, and pursues patient balances.

4

Fee Applied

athenahealth applies 4-7% to net collections deposited to your bank account.

What Are "Net Collections"?

The athenahealth fee applies to your net collections — not your charges, not your gross receipts. Net collections are defined as payments actually received from:

Included in Net Collections

  • Insurance reimbursements (Medicare, Medicaid, commercial)
  • Patient copays collected at check-in
  • Patient balances collected after insurance
  • Secondary insurance payments
  • Worker's compensation payments
  • Collection agency recoveries

Not Included (Exclusions)

  • Charges that are written off or adjusted
  • Contractual adjustments from payer contracts
  • Bad debt write-offs
  • Courtesy discounts
  • Government program adjustments
  • Collections from non-patient sources

Important: Net collections are typically 70-85% of gross charges for a well-run practice. If you charge $100,000/month but adjust for contracts and bad debt, your net collections may be $75,000 — and the athenahealth percentage applies to that $75,000 figure.

What Determines Your Percentage Rate?

FactorImpact on RateTypical Effect
Number of providersHigher count = lower rate↓ 0.5–1.5% for 10+ providers
Monthly collections volumeHigher volume = lower rate↓ 0.25–1% for $200k+/month
Contract lengthLonger term = lower rate↓ 0.25–0.5% for 3-year
Specialty complexityComplex billing = slight premium↑ 0.25–0.5% for subspecialties
Payer mixGovernment-heavy payers = possible adjustmentVaries
Modules selectedFull suite vs. EHR onlyRCM included drives higher %
Negotiation leverageCompetition in your market↓ 0.5–1% with competitive quotes

Real-World Cost Examples

Solo Primary Care

Providers1 physician
Monthly gross charges$80,000
Net collections$60,000
athenahealth rate6.5%
Monthly fee$3,900
Annual fee$46,800

5-Provider Group

Providers5 physicians
Monthly gross charges$400,000
Net collections$300,000
athenahealth rate5.5%
Monthly fee$16,500
Annual fee$198,000

20-Provider Multi-Specialty

Providers20 physicians
Monthly gross charges$1,600,000
Net collections$1,200,000
athenahealth rate4.5%
Monthly fee$54,000
Annual fee$648,000

Is the Collections Model Good for Your Practice?

The collections model can be advantageous or costly depending on your practice size, specialty, and growth trajectory. Here's how to think about whether it works for you.

Collections Model Works Well When...

  • Your collections are below $100,000/month (lower absolute cost)
  • Your billing is currently disorganized — athenahealth often improves collections
  • You want to eliminate billing staff overhead
  • You prefer variable costs over fixed overhead
  • Your practice is growing and you want scalable infrastructure
  • You lack internal IT capacity for on-premise systems

Collections Model Is Expensive When...

  • Your collections exceed $500,000/month (high absolute cost)
  • You already have an efficient in-house billing team
  • Your specialty has very high per-encounter reimbursement
  • You prefer predictable fixed costs for budgeting
  • You have the IT capacity to run your own infrastructure
  • Your payer mix is heavily government with low margins

How to Negotiate Your Collections Rate

01
Get competing quotes first

Obtain quotes from NextGen, Kareo, or AdvancedMD before negotiating with athenahealth. Use these as leverage to push below 5%.

02
Commit to a longer contract

athenahealth will discount 0.25–0.5% for 3-year commitments versus year-to-year agreements.

03
Consolidate providers

If you have satellite offices, negotiate a single enterprise agreement for all locations combined to reach volume thresholds.

04
Ask about performance guarantees

Request a clause tying fees to collections improvement — if athenahealth doesn't improve your collections rate, your percentage should decrease.

05
Time your negotiation

athenahealth sales reps have quarterly quotas. Negotiations in late March, June, September, or December often yield better terms.

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