3 Metrics Every Practice Owner Should Track Monthly
- KC Billing Solutions
- Oct 13, 2025
- 2 min read
Updated: Oct 17, 2025
A quick guide to evaluating A/R, denials, and collection efficiency.
1. Collections Percentage
Your collections percentage shows how much of your billed charges you actually collect after contractual adjustments. If your practice is consistently collecting less than 90–95% of expected reimbursement, there may be inefficiencies in coding accuracy, claim follow-up, or payer management. Monitoring a few key metrics each month helps ensure your revenue cycle stays healthy and predictable.
How to calculate it: (Payments ÷ Adjusted Charges) × 100 = Collections %
Benchmarks:
95–98% for commercial payers
90–94% for Medicare and Medicaid
What to watch for: A drop in this metric over two or more months could mean delayed claims, higher denials, or missed secondary billing.
2. Accounts Receivable (A/R) Days
Your A/R days reflect how long it takes to get paid after a claim is submitted. This is one of the clearest indicators of your billing team’s efficiency.
How to calculate it: (Total A/R ÷ Average Daily Charges) = Days in A/R
Healthy ranges:
Specialty practices: 30–40 days
Red flag: Over 50 days
Why it matters: The longer claims sit unpaid, the greater the risk of denials or write-offs. Tracking this metric helps you pinpoint where claims are stalling clearinghouse, payer, or follow-up delays.
3. Denial Rate
Your denial rate shows the percentage of claims that are rejected or denied by payers. High denial rates drain both time and revenue, every rework adds administrative cost and delays cash flow.
How to calculate it: (Denied Claims ÷ Total Claims Submitted) × 100 = Denial Rate
Benchmarks:
Target: <5%
Red flag: >8%
Top causes of denials:
Missing modifiers or diagnosis codes
Eligibility or authorization issues
Late submissions or billing errors
Pro tip: Review your top five denial codes monthly and ensure your billing partner is addressing root causes not just resubmitting claims.
Putting It All Together
Tracking these three metrics monthly gives you a clear snapshot of your financial health. Even well-run practices can lose thousands each quarter from unnoticed inefficiencies. By watching collections, A/R, and denial rates, you can spot problems early and prevent revenue loss before it snowballs.
KC Billing Solutions: Data That Drives Decisions
KC Billing Solutions helps specialty practices track, analyze, and improve key revenue cycle metrics every month. Our team provides transparent reporting, actionable insights, and hands-on support to ensure your collections stay strong and your workflow stays efficient.
