Banner

Gross Versus Net Collections

Article

I am new to my practice, and have noticed that its gross collection percentage is down. I’m trying to figure out why. What do you suggest?

Question: I am new to my practice, and have noticed that its gross collection percentage is down. I’m trying to figure out why. What do you suggest?

Answer: I’d basically ignore gross collection percentage. All it does is say what percent you collected of what you charged. What matters is what you collected of what you are owed.

Here is what likely happened:

Last year, you charged, say, $100 for a 99212. Insurance paid $80. That equals an 80 percent gross collection rate. This year, you charged $120 and still got paid $80 (or perhaps $84, since you negotiated better rates). That equals a 70 percent gross collection rate. It sounds worse, but, really, you are collecting about the same amount.

Conversely, it’s easy to make your gross collection rate look great by dropping charges, but it’s actually meaningless. Instead, ask for reports on adjusted collections. Are you collecting most of what you are contractually supposed to collect?

When it comes to collections, history may be less important than in other areas. More is always better, and everyone should push for more no matter what happened in the past.

Recent Videos
Handling phone calls with difficult patients
Andrea Greco on next steps after identifying a security gap during a risk assessment
Andrea Greco on regulatory compliance for risk assessments
Andrea Greco talks risk assessment blindspots
Andrea Greco, SVP of healthcare safety at CENTEGIX, talks about common risk assessment tools.
Risk assessment frequency with Andrea Greco, SVP of healthcare safety at CENTEGIX
Related Content
© 2025 MJH Life Sciences

All rights reserved.