For decades, the billable hour has been the bedrock of legal pricing. Especially in litigation, regulatory matters, and other complex cases, time and expense billing provided a seemingly fair way to capture the unpredictable nature of legal work. But just because it has worked doesn't mean it's the best fit for today's practice.

In a legal world reshaped by client expectations and emerging technologies, particularly AI, it's time to reevaluate: Does every part of a matter still warrant hourly billing? Or are there more modern, efficient, and client-friendly ways to price legal services?

Time and expense billing emerged because it aligned effort with compensation. Lawyers tackled unpredictable caseloads and were paid for every hour of intellectual labor. It made sense: when outcomes and timeframes were murky, this model protected both firms and clients from financial imbalance.

But the Legal Market Has Shifted

Today's clients aren't just asking for results; they're asking for predictability, transparency, and value. Meanwhile, legal tech—particularly AI and AI agents—has dramatically shortened the time required for certain tasks. A legal research memo that once took three hours might now take 30 minutes with the right tools. But if the output and value are the same, should the price tag shrink?

Maybe. Or maybe the pricing structure just needs to evolve.

What Parts of a Matter Can Be Flat-Fee?

Rather than tossing out time and expense billing altogether, firms should conduct a billing audit: Which parts of a matter are still being billed by habit, not necessity?

Here are areas ripe for rethinking:

• Legal Research: With AI tools providing draft answers in minutes (subject to attorney verification), many firms are moving to flat fees for research tasks.
• Court Appearances: Instead of clocking hours in and out, consider a flat daily rate for trial or hearing days.
• Discovery and Document Review: Thanks to automation and predictive coding, these phases can be scoped and priced in advance more easily.

Hybrid Billing: The Best of Both Worlds

The future of legal pricing may not be a binary choice between hourly and flat-fee. A hybrid model allows firms to align pricing with the value, risk, and predictability of each task:

• Hourly for bespoke strategy and complex judgment calls
• Flat-fee for repeatable, tech-enhanced tasks
• Milestone pricing for defined matter phases

A Call for Strategic Pricing

Lawyers pride themselves on their analytical minds. So apply that same analysis to your billing model. Are you pricing based on effort, or value? Are you rewarding efficiency, or penalizing it?

Clients are evolving. Tools are advancing. And law firms that thoughtfully adapt their billing models will not only compete better—they'll build deeper trust with their clients.

The billable hour may never fully disappear. But it shouldn't be the only lens through which we see the value of legal work. Sometimes, it's not about working longer—it's about working smarter, and pricing smarter too.

Where Practice Management Comes In

Adopting hybrid or alternative billing models isn't just a philosophical shift—it requires practical support. Many modern practice management systems are designed to accommodate both flat and time-and-expense billing with ease. At 2b1 Inc., we help firms evaluate and implement these tools effectively. Whether you're choosing a new platform or customizing the one you already use, we can help ensure your systems support the billing strategy that fits your practice best—so you can focus on delivering value, not chasing hours.