Net collection rate is the percentage of expected collectible revenue actually collected, calculated as payments received divided by charges minus contractual adjustments.

This is the metric that tells you whether your revenue cycle is working. A 95% net collection rate means you're leaving 5% of money you've already earned on the table through write-offs, untimely filing, and collection failures. Top performers achieve 98%+ net collection rates.

For telehealth, patient responsibility portions often represent a larger share of revenue due to higher deductible plans and out-of-network scenarios. This means your patient collections process—payment at time of service, payment plan options, follow-up on balances—has outsized impact on net collection rate compared to traditional practices heavily weighted toward payer revenue.

Calculate this monthly and track the trend. Declining net collection rate is an early warning sign of revenue cycle problems before they hit your cash position.

Related terms: Patient payment collection rate, Days in Accounts Receivable, Cost to collect