Executive teams cannot manage what they cannot see. These five KPIs form the foundation of revenue cycle oversight — and should be reviewed on a structured cadence, not just at year-end.
Days in Accounts Receivable
What it measures: Average time to collect payment after service.
Target range: 30–40 days for most physician practices; specialty and payer mix affects benchmarks.
Red flag: Sustained increase over 60 days without volume or payer mix explanation.
Net Collection Rate
What it measures: Percentage of collectible revenue actually received.
Target range: 95–98% for mature operations.
Red flag: Declining NCR with stable payer mix indicates underpayments, denials, or posting gaps.
First-Pass Acceptance Rate
What it measures: Claims accepted on initial submission without rework.
Target range: 95%+ for high-performing teams; 98%+ is achievable with disciplined front-end controls.
Red flag: Below 90% — investigate top denial and rejection reason codes immediately.
Denial Rate
What it measures: Percentage of claims denied by payers.
Target range: Under 5–7% depending on specialty.
Red flag: Spikes by payer or provider often indicate coding, auth, or enrollment issues.
Cost to Collect
What it measures: Total RCM cost as a percentage of collections.
Target range: Varies by model — compare against fully burdened in-house cost including salary, benefits, software, and turnover.
Red flag: Rising cost without corresponding collection improvement.