Track Monthly Financial Indicators

Monitoring key financial indicators is a good way to keep a finger on the pulse of your practice. Setting up a form that's completed monthly will help you keep track of trends.

Create a table that includes a descriptive column for each indicator below, and a second column for staff to enter the data for your practice. This table can be attached to the accounts receivable report and income statement each month, and serve as an overall snapshot of the practices' financial performance.

1. Days in receivable. The number of days, on average, it takes for an account to be paid.

2. Receivables greater than 90 days old.

3. Net collections ratio. The percentage of collectible dollars that have been collected.

4. Gross collections ratio. The percentage of charge dollars that have been collected.

5. Operating overhead. The percentage of revenues required to meet operating expenses.

Customize this Sample Form

DOWNLOAD a sample financial indicators form and customize it to your practice. Equations for calculating the indicators are included on the form.

Use Benchmarks

The Medical Group Management Association's Annual Cost Survey provides useful data on a variety of financial indicators, and separates it by specialty. Order the study annually at: www.mgma.com