Rules change. Payer policies shift. What matters is whether medical billing is turning work into cash. If you want to know whether your revenue cycle is healthy, you need to measure it. A simple dashboard that tracks a few key metrics for medical billing gives you a clear view and a place to start.

In revenue cycle management (RCM), those numbers connect front-end checks to back-end collections. They help providers in a medical practice and larger healthcare organizations see delays, compare performance over time, and protect financial health. 

In this guide, we focus on practical, well-defined measures you can track the same way each month to guide staffing, training, and small process changes.

Without a doubt, the best overall indicator of billing performance is days in receivable outstanding (DRO). DRO tells you how long money sits in accounts receivable. Track it the same way each month so trends are real and not just noise. The formula is simple:

DRO = (receivables outstanding + credit balances) ÷ average daily charges. Adjust for credits so weak performance isn't hidden.

How to calculate: Use charges by date of service, not posting date. For average daily charges, total the last 3 months of charges, then divide by 90. That normalizes seasonality and changes in volume. You can use a full year, but the 90-day view keeps the math closer to current reality. Tie each input back to your ledger for a clean audit trail.

What good looks like: Many teams use an industry benchmark of 30 to 40 days. Lower is better, but context matters. Payer mix, payment plans, and your front-end workflow all move the needle. If DRO drifts upward, tighten eligibility checks, collect at the time of service, and prioritize clean claims.

Use a KPI dashboard to monitor DRO alongside total AR and denial metrics. Improving DRO will optimize work effort and strengthen financial performance over time. It also helps to submit clean and timely claims. For practical steps, explore our guide on electronic claim submission.

Monitor the receivables sitting in your aged trial balance to determine if your efforts are paying off. Watch the aging report and track what share of accounts receivable sits past 120 days. Many teams use industry standards that flag anything above 10% as a risk. Lower is better, but context matters. Exclude credits when you calculate the figure so the picture is honest.

Separate payment plans into their own class. That keeps patient collections activity from hiding slow pay and lets you compare the 120-day slice with and without plans. Also, tag write-offs and bad debt clearly, not as general adjustments, so trends are easy to spot.

If the percentage creeps up, review front-end checks, tighten follow-up, and look for workflow gaps that delay appeals or rebilling. Small fixes compound over time and protect financial health while you work claims back toward current.

Although it's nice to measure your collections as a percent of gross charges (commonly referred to as the gross collection rate), you can't use the result to judge the performance of your revenue cycle. Net collection rate (NCR) shows how much of the allowed amount you actually collect. 

Unlike gross collection rate, which is distorted by fee schedule differences and payer mix, NCR reflects real reimbursement. If the allowable for a 99212 is $76.40, the goal is to receive that full amount from the payer and the guarantor together.

Most practices aim for 96 to 99%. The rest typically becomes bad debt or write-offs — both of which reduce profitability. Some teams label NCR as a collection ratio, but the concept is the same. You’ll want to track it monthly to see whether front-end checks, follow-up, and posting habits are improving performance.

To strengthen your NCR process:

Over time, accurate NCR tracking supports smarter decisions and improves long-term profitability.

Clean claim rate tells you how often a claim is paid without edits or rework. Think of it as a quick read on front-end quality and payer readiness. Many teams also track first pass resolution to see what payers approve on the first try. Use one clear formula: 

Clean claim rate = (number of claims paid on first submission ÷ total number of claims) × 100, or the percentage of claims that cross the line cleanly. Keep the time window consistent so trends mean something.

Raising the rate starts with better claim submission. So, correct demographics, eligibility verified, right codes and modifiers, and required attachments in place. Post results to your KPI dashboard, review by payer and location, and treat the metric as one of your key metrics for the billing process. Small fixes reduce phone calls and rework, which leads to faster payments and steadier cash flow.

Denial rate (or claim denial rate) is the share of claims a payer rejects on first review. Common drivers include missing prior authorization, demographic typos, coding that lacks specificity, coverage gaps, and late filing. Each claim denial adds rework and slows cash.

Strong denial management starts before submitting claims. Verify eligibility, document clearly so coders select accurate codes, and use clean electronic claim submission. Pair that with consistent follow-up on denied claims and root-cause logs you can trend over time.

Review workflow weekly to surface inefficiencies and update checklists inside your EHR software. If backlogs spike, use targeted outsourcing for appeals or status checks to protect cash while the team fixes upstream issues.

Cash, measured as net patient service revenue (NPSR), shows whether work turns into money. Track it daily or weekly and compare rolling 4-week trends to prior periods. Pair the line with visit volume and average reimbursement to separate timing from performance. 

Expect swings when new providers start, schedules shift, or refunds go out. Better point-of-service collections and cleaner claims lead to steady cash flow. If the curve dips, check denials, posting lags, and payment plans. The goal is a steady upward slope that supports profitability and protects financial health.

Use the numbers and knowledge you gain to drive small, steady changes. Keep the loop simple and repeatable:

Focusing on a short list of KPIs keeps teams honest and progress visible. When practices track DRO, A/R over 120 days, and NCR the same way each month, small fixes compound into stronger financial performance. 

A unified dashboard and smart automation help turn work into faster payments and steadier financial health, and you can explore tools and guidance at Tebra to make the next step easier.