Managing your dental practice's revenue cycle effectively can feel overwhelming, but it all boils down to understanding and tracking the right metrics. With the right data at your fingertips, you can build a sustainable, healthy revenue cycle that supports your practice's growth. In this post, we'll dive into the four key metrics that every dental practice should monitor to ensure healthy revenue flow. These metrics apply to any practice management software, whether you’re using Open Dental or a different system.

1. Average Days to Collect

The first metric to focus on is your average days to collect—how long it takes from the moment you perform a service to when the payment lands in your bank account. Ideally, this number should stay at or below 30 days. However, many practices we work with have averages of 90 days or more. The longer it takes to collect, the more difficult it becomes to maintain cash flow.

Tip: If your practice has an average above 30 days, this is a red flag that improvements are needed in both your billing processes and collections. Start tracking this number regularly to pinpoint where delays occur, and set goals to bring it down.

2. Percentage of Accurate Treatment Plans

An accurate treatment plan is crucial for collecting the patient’s portion upfront. If treatment plans are inaccurate, you're more likely to miss out on payments, experience higher denials, or have discrepancies with insurance reimbursements.

How to improve this: Implement regular audits of treatment plans. Make sure your team is well-trained in entering and reviewing plans to ensure that they match the actual treatments. This helps build trust with patients and speeds up collections.

3. Aging Reports

When we talk about "aging" in revenue cycle management, we’re referring to both insurance aging and patient aging. These two aging reports show you how long overdue balances have been sitting unpaid by both patients and insurance companies.

• Insurance Aging: Run this report to see what’s collectible and what might end up as a write-off. Many practices make the mistake of focusing only on the total amount of outstanding claims, but that doesn’t give you an accurate picture. By breaking down your insurance aging report by expected write-offs and actual collectability, you can get a clearer sense of your financial standing.

• Patient Aging: Just as important, patient aging shows you how long patients' balances have gone unpaid. Tracking this closely will help you identify patterns in payment delays and adjust your patient communication or collection processes.

Take action: Run both aging reports monthly, and assign someone on your team to follow up on older outstanding balances before they age beyond 60 or 90 days.

4. Percentage of Denials and Appeals

Lastly, you need to track the percentage of denials and appeals that come through your insurance claims process. This metric will help you identify bottlenecks in your workflow—whether it’s incomplete documentation, missing chart notes, or improper claim submission. The higher your denials, the more your insurance aging and average days to collect will climb.

Pro Tip: If you're seeing a high percentage of denied claims, it's time to examine your protocols. Are your claims being submitted with the proper imaging and notes? Do your team members know what information is needed to submit a clean claim the first time around? Reducing denials will improve your cash flow and reduce stress on your back-office team.

Tracking these four metrics will give you a solid understanding of the health of your revenue cycle. By making improvements where necessary, you’ll ensure that your practice is getting paid for the services you provide in a timely and efficient manner. For those looking for more in-depth reports, templates, and strategies, be sure to check out the Dental Revenue Cycle Blueprint, available for pre-order until October 1st at a discounted price. This comprehensive workbook is packed with everything you need to streamline your revenue cycle and keep your practice running smoothly.

Call to Action:
If you're ready to take control of your practice's revenue cycle, drop a comment below or check out the link in our bio for more resources. Don't forget to grab the Dental Revenue Cycle Blueprint at $29.99 before October 1st!