The 5 revenue cycle KPIs every practice should track (and their target numbers)

Most practice dashboards drown administrators in numbers while starving them of signal. After managing revenue cycles for hundreds of practices, we've found that five metrics carry most of the information you need to know whether your billing operation is healthy.

Days in A/R measures how long, on average, money owed to you stays unpaid. Calculate it as total accounts receivable divided by average daily charges. Best-practice target: under 35 days. Above 50, you have a collections problem compounding daily.

First-pass clean claim rate is the percentage of claims accepted and paid without rejection or denial on first submission. Target: above 95%. Every rejected claim costs roughly $25 to rework — and the practice average hovers near 75-85%, which is an enormous hidden cost.

Net collection rate answers the most important question in billing: of the money you were contractually entitled to collect, how much did you actually collect? Target: above 96%. This is different from gross collection rate, which compares collections to charges and mostly measures how inflated your fee schedule is.

Denial rate should sit below 5% of claims submitted. Just as important as the rate is the rework rate: industry surveys consistently show that more than half of denials are never worked at all — which means the average practice is voluntarily forfeiting revenue it already earned.

Percent of A/R over 90 days reveals how much of your receivable base is decaying. Target: under 15%. Claims over 90 days old collect at a fraction of their face value, and every bucket they age through cuts recovery odds further.

If your numbers miss these targets, the gap is quantifiable — and usually fixable. A revenue cycle assessment can tell you exactly where the leakage is and what it's worth.