Collection Percentage:

This metric provides an understanding of the percent of net charges that are collected over a certain period of time.  To complete this section you’ll want to bring three figures to the equation.  It is recommended that the sum of the last 12-months be used for each variable.

• Gross Charges:  Total patient charges within the 12-month evaluation period
• Contractual Write-off:  Total amount of gross charges written-off due to payor contracts over the same 12-month evaluation period
• Payments:  Total payments received within the same 12-month evaluation period

Daily Sales Outstanding:

Daily sales outstanding (DSO) is a measure of the average number of days that it takes to collect payment after treatment has been provided.  To complete this section we’ll want to evaluate performance over a period of 4 consecutive months.  To provide you with an understanding of your DSO, please submit the below information. 

• Month: The name of the month (I.e. June, July, August, September)
• Charges:  The total charges that were billed in each respective month
• Days In Month:  The total number of days in each month
• Accounts Receivable:  The total outstanding payments still to be collected at the end of the four-month period you’re evaluating

Arc Ratio:

The ARC Ratio provides an understanding of the amount of average monthly charges that are collected each month.  This is a measure of average total monthly accounts receivable compared to average monthly charges.  To provide you with an understanding of your DSO, please submit the below information. 

• Accounts Receivable:  Consider a period of 12-months.  Include the total balance of your accounts receivable at the end of the 12-month period. 
• Average Total Monthly Charges: Consider a period of 12-months.  Total your monthly charges over the 12-month period and divide this number by 12 (I.e. 12-months)