Stay up-to-date on skilled nursing regulations along with tips and tricks to improve your medical billing from the experts at MCA.

Posted: May 19, 2022

Medical Billing KPIs Your SNF Should Be Tracking and Why

How would your Skilled Nursing Facility (SNF) answer this question?

Are you meeting your financial goals? 

Perhaps you’d rattle off a set of metrics you’re tracking. Or, maybe you’re not sure how to answer this question. Either way, it’s almost impossible to answer with a simple ‘yes’ or ‘no’ to this question. To adequately answer this question, you need to have an in-depth knowledge of the metrics your facility should use to measure financial success. 

If your facility is outsourcing your medical billing or handling its billing in-house, it’s always important to have a good understanding of your financial health. It’s important to be able to identify where your facility is performing well and where you could make some improvements. That’s why identifying and monitoring key performance indicators (KPIs) for medical billing is critical.

What is a Key Performance Indicator?

A key performance indicator (KPI) is a measurable value that indicates how well you’re achieving key business objectives. In our case, how well your medical billing and coding are performing. 

KPIs can be used to track a variety of business objectives. But, the key (pun intended) to a strong KPI is that it must be measurable. The most effective KPIs provide you with data points that you can compare over time, help you to identify trends, and potential improvement opportunities. 

Medical billing KPIs provide a way for you to monitor a part of your revenue cycle on a consistent schedule. Helping you determine whether you’re on target to achieve your established goals. Additionally, KPIs provide a basis for decision making, provide focus areas for operational improvements, and help you focus on what matters most.

How to Choose the Right KPIs for Your Facility

When selecting a KPI, it’s crucial to understand the metrics that are most important to your medical billing department. For example, Accounts Receivable (AR) might seem like an easy choice. But, there are more specific AR metrics that you can drill down into. Metrics that will help improve decision-making and operational management in the future. 

To begin, assess the KPIs that your medical billing team is currently tracking. This will provide you with a snapshot of where you’re at. And, help clarify if the KPIs you are currently monitoring provides you enough information, are measurable, and support your operational imperatives.

Keep in mind that monitoring too many KPIs can be overwhelming. Focus on the KPIs related to the work your medical billing and coding team does. Narrowing your focus will make any opportunities for improvement clear.

5 Medical Billing KPIs Your SNF Should be Tracking

Regularly monitoring your medical billing KPIs helps ensure that your facility is collecting what’s expected. But, there are a few KPIs that every SNF (or outsourced medical billing partner) should be monitoring. The following 5 medical billing KPIs are a great place to start.

1. Collection Performance

Collection performance is a snapshot of your SNFs financial health and efficiency. Associated with days in AR, this measures how effective your SNF is at collecting all forms of reimbursement for services. This is typically the amount owed after payer contract adjustments have been made.

If a facility has a low collection rate it’s likely an indicator that there is a persistent problem gathering revenue. The facility could be struggling with revenue collection due to late filings, coding errors, bad debt, or claim underpayments. 

MCA strives to have facilities reach a 90% collection rate in their first 30 days and 98% in their first 60 days from the submission date.

2. Days in AR

A SNFs accounts receivable (AR) provides insights into how long it takes to collect on balances after billing. This includes payments that have not yet been collected for both insurance reimbursements and out-of-pocket services. 

Healthy days in AR metric should be between 30 and 40 days. This ensures that your operational processes are streamlined and your facility is getting paid faster. If your days in AR are greater than 40 days this could indicate billing and coding errors or process inefficiencies that need to be addressed. 

3. AR Greater Than 120 Days

The percentage of AR over 120 days helps to illustrate how healthy the AR is. After 90 days, outstanding bills and claims become much more difficult to collect. And, it’s unlikely you’ll collect any AR over 120 days which will result in a write-off.

If more than 15% of your claims are spending 90 to 120 (or more) days in AR, this indicates there are inefficiencies in your billing process. Also, tracking the percentage of AR over 90 to 120 days allows your billing team to review these claims to reduce the risk of a future write-off. 

4. Denial Rates

Denial rates help show how many claims are denied. Denial rates in the U.S. healthcare industry tend to range from about 6 to 13%. And a large percentage of claims denials are avoidable with medical billing and coding process improvements. 

If your denial rate is right, it’s important to drill down into the reasons. For example, a high percentage of your denials come from a particular payer, there may be issues to resolve with that payer. MCA recommends that your average denial rate should be less than 5% each month.

5. Clean Claim Rate (CCR)

Clean Claim Rate (CCR) indicates the quality of claims data being collected and reported. A high CCR means decreased cost, less time in AR, and improved cash flow. A low CCR means that your staff is investing extra time in reworking and resubmitting the claim.  

Claim rejections are costly and a CCR lower than 95% means your facility is losing revenue. On average, SNFs have a CCR that varies between 75% to 85%. This indicates that approximately 15 – 25% of submitted claims must be worked twice each month. 

MCA – Expert Help to Improve Your SNF Billing KPIs

Identifying and monitoring KPIs for medical billing is important and a great first step. Yet, making improvements to KPIs that you are struggling with can be a challenge. 

MCA is here to help! We’re skilled nursing medical billing experts and we work with clients every day to improve and monitor import KPIs. We provide regular reporting and support meetings to help ensure you are meeting and exceeding your operational metrics. 

Drop us a note or give us a call at 866-609-5880 to learn more about how MCA can improve your SNF billing KPIs.

About MCA Medical Billing Solutions

MCA is a full-service revenue cycle management company dedicated to helping skilled nursing facilities advance their revenue cycle management. We provide claims creation, submission, and follow-up to Medicare, Medicaid, and all commercial insurers.

When you choose MCA you can expect experienced business insight, skilled billing intelligence, data extraction and management, and cloud-based documentation. MCA is here to help you streamline your revenue cycle process to produce consistent, high-quality outcomes. 


“Over Third of Hospital Execs Report Claim Denial Rates Nearing 10%.” 7 Jun. 2021, Accessed 20 Apr. 2022.