Calculator
Work out your net collection rate.
The single number that reveals whether your billing is working. Three inputs from your last month-end close, no email required, nothing stored.
Three numbers from your month-end close.
All three appear on a standard practice management report. If yours does not show contractual adjustments separately, that is worth asking about on its own.
Gross charges posted for the period, before any adjustment.
The difference between what you billed and what your contracts allow. Not write-offs, not bad debt.
Everything collected for the period, insurance and patient combined.
Net collection rate
Net collection rate = payments ÷ (charges − contractual adjustments). A single month is noisy — payments arrive for claims billed in earlier periods, so run at least a rolling quarter before drawing conclusions. Nothing entered here is transmitted or stored.
Why this number and not the other one
Almost every billing company leads with clean claim rate: the share of claims accepted on first submission. It is the easiest number in billing to make look good, and it is measured differently by every company that quotes it. Some count a claim as clean once it clears the clearinghouse, before a payer has looked at it.
Net collection rate cannot be gamed the same way, because it measures the end of the process rather than the beginning. It captures every leak at once — denials nobody appealed, underpayments that posted without a variance check, patient balances that aged out, claims that passed timely filing.
That is why a practice can run a 98% clean claim rate and an 87% net collection rate simultaneously. Both numbers are true. Only one of them is about money.
What the result means
- 96% and above — performing well. Remaining loss is mostly small patient balances and genuinely uncollectible claims.
- 93 to 96% — normal, with room. Usually a denial category nobody has traced or a set of underpayments nobody is checking.
- 90 to 93% — something specific is wrong and it is findable. Most often aged A/R that stopped being worked.
- Below 90% — a structural problem rather than a performance one. Worth an audit before anything else.
These bands are industry rules of thumb, not benchmarks specific to your specialty or payer mix. A practice with heavy Medicaid exposure and one with heavy commercial exposure are not comparable on this metric, which is why the audit calculates yours against your own contracts rather than a national average.