What are days in A/R?
Days in A/R measures how long it takes, on average, to collect revenue: net accounts receivable divided by average daily net revenue. Lower means faster cash.
Net days in A/R
| Step | Value |
|---|---|
| Net A/R at quarter end (after expected adjustments) | $1,200,000 |
| Net patient service revenue for the quarter | $2,700,000 |
| Average daily net revenue: $2,700,000 / 90 days | $30,000 |
| Net days in A/R: $1,200,000 / $30,000 | 40 days |
- Using net figures, after contractual adjustments, keeps the number from being inflated by charges nobody expects to collect.
Days in A/R is the revenue cycle’s speedometer. It says how many days of revenue are sitting in receivables, waiting to be collected.
How it’s calculated
Net accounts receivable divided by average daily net patient service revenue, usually over the last 90 days. Net means after contractual adjustments, so the number reflects money actually expected.
What drives it
Claims that go out late, rejections nobody works, denials waiting in a queue, slow payers and patient balances all add days. The number alone doesn’t say which, so it’s read together with A/R aging by payer and the denial rate.
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