What is Gross collection rate?
Payments as a percentage of gross charges — mostly a reflection of your fee schedule, not your collections performance.
Definition
Gross collection rate divides total payments by total charges before any adjustment. Because charges are set by the practice and payments are capped by contracted rates, the ratio largely measures the distance between the two.
That makes it a poor performance metric in isolation and an easy one to manipulate — raising the fee schedule lowers gross collection rate while changing nothing about actual collections. It is useful mainly as a trend line and as a check on whether the fee schedule is set sensibly relative to contracts.
Why it matters
Reporting gross collection rate as a performance metric hides denial problems behind a number that mostly measures pricing.
Related terms
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