Starting a Home-Based Medical Coding Business – Is it for You?

medical coding business idea
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Many people want to become independent, own their own company and be their own boss; medical coding is one such occupation that can provide all three. This profession is a growing part of the healthcare industry as accurate record-keeping continues to become more and more critical.

A home-based medical coding business is a venture for the right kind of person. Such an individual should have a strong entrepreneurial spirit and a willingness to keep trying, even in the face of possible economic downturns; however, it is not for everyone. As attractive as starting a business may sound, this is a decision that takes careful thought and only after serious weighing of the pros and cons should the decision be made. Here are some thoughts to consider in the analysis:


Current Demand for Medical Coders

The US Bureau of Labor Statistics forecasts a higher than average employment growth in the 2010 2020 decade for medical coders. The demand for accurate record-keeping is not just a financial consideration. Laws enacted, particularly the Health Insurance Portability and Accountability Act of 1996 (HIPPA), are requiring more detailed record-keeping and reports than ever before.

The Money is There

The Bureau estimates a median wage of $32,350 annually for medical coders. Wages do vary by region and the AAPC has estimated that medical coders on the Pacific coast will make as much as $53,334 a year on average. These figures suggest that an independent medical coder can expect to make a fairly decent income.

Considerable Flexibility

An independent contractor sets his or her own hours and though having a home business may require working late nights, the schedule is entirely up to the owner. This is fantastic for somebody who’s raising a family or has other obligations. Being your own boss is a dream of many frustrated office workers, and having a home-based business offers the satisfaction of not reporting to anybody.


Upfront Costs

Anyone starting a home-based medical coding business must have a computer with Internet access, a good telecommunication system that permits e-mails and faxes, processing software for coding that is compatible with what the clients use and the code books themselves. All of this should be in place prior to starting the business, and it can be quite expensive.

Marketing Demands

No one beats a path to an unknown door. Someone who wants to be successful in a small business must be willing to reach out on a daily basis to attract more clients. Like it or not, a business owner has to spend a portion of their day actively seeking business; more so in the early stages of development. There will be days when there is a lull in business activity and an independent medical coder must budget for the lean times. Until the business is established, wages may not be as good as those earned by employed medical coders. Anyone operating a home-based business must accept these realities and be tough enough to endure them.

Mandatory Experience and Credentials

No one is going to seriously consider contracting out to a beginner. It’s important for a medical coder to have a few years of experience in a hospital or doctor’s office before starting an independent business. Prospective clients need to see credentials as proof of professional competence. A freelance medical coder must commit to a lifelong learning process of continual refresher courses and sitting for professional examinations to acquire further certifications.


None of the above should be considered negative. Rather, it is an appeal for serious assessment of a potentially life-changing decision. Not everybody has what it takes and it is better to realize that ahead of time than venture forth and discover a mistake. If an individual is able to maturely weigh the options and decide that a home business is worth the risk, that medical coder should go ahead and take the chance. There are enormous intrinsic rewards to be found in owning your own business. It can be very lonely at the top but then again, the view is excellent.

About the Author: Elyse Hartman is the owner of a leading educational website for current and aspiring medical coders. She takes great pride in providing up-to-date and accurate information about the profession, and hopes her experience and insights can be of great value to people in the field. She welcomes your comments and questions at support [at]