Practice management
Collection ratio
The collection ratio, or collection rate, compares money collected with adjusted production, expressed as a percentage, to show how much of the collectible fees a practice actually receives.
The ADA gives the formula for a collection rate as collections divided by adjusted production, times 100. Adjusted production is the same idea as net production. A rate near 100 percent means the practice is receiving almost everything it was allowed to bill. The ADA's list of commonly tracked key performance indicators states that if a practice is not collecting 98 percent of billable or adjusted production, its policies and scripts may need adjusting. That figure is ADA guidance, not a legal or industry standard. Always check how a report defines both the numerator and denominator of the ratio, since gross production gives a different answer.