Why Your Practice Isn't Getting Paid and How to Fix It

In 2025, despite rising care demand, many practices are struggling to get paid in full or on time. Research indicates that up to 20% of revenue is lost due to flaws in Revenue Cycle Management (RCM) costs totaling hundreds of thousands in missed dollars annually. From simple registration errors to complex coding mistakes, the breakdowns are costing you more than you think.

Registration and Patient Information Errors

One of the most common and avoidable causes of denied claims is incorrect patient demographics: misspelled names, wrong birthdates, outdated insurance, or unseen eligibility problems . These errors often arise from lack of upfront verification or manual data entry flaws, and they result in false starts and administrative backlogs.

Coding & Billing Inaccuracies

Studies show up to 80% of claims contain errors, leading to billions lost annually. These include:

• Wrong or outdated CPT/ICD-10 codes

• Missing or incorrect modifiers

• Failing to adhere to NCCI edits and payer policies

Inaccurate billing not only denies payment but also opens the door to compliance risks and reputational damage.

High Claim Denial Rate

Denial rates of 15–20% are common in 2025—often tied to codes like CO-4 (missing modifier), CO-16 (missing info), or CO-29 (late submission). Without strong denial management, these denials represent uncollected revenue and administrative burden.

Weak Denial Follow-up

Two-thirds of denied claims go unappealed, meaning practices lose half their appealed revenue. Delays in follow-up reduce reimbursement prospects and reflect gaps in billing leadership and protocol.

Poor Point-of-Service Collections

Only collecting insurance payments and neglecting co-pays and deductibles at check-in leaves money uncollected. Lack of payment channels—online or in-person—reduces collections further.

Financial Opacity & Surprise Billing

Patients faced with unexpected statements are less likely to pay. Even with law protections like the No Surprises Act, poorly calibrated estimates and billing ambiguity continue to demoralize patients and impair cash flow.

No KPIs, No Clampdown

Without regular tracking of metrics like A/R days, net collection rate, denial rates, or clean claim rate, problems remain hidden. Tracking these is essential to process improvement .

Fee Schedule Errors & Payer Underpayment

Outdated fee schedules cause underbilling. Additionally, weak negotiation or contract misalignment means payers pay less than FMV. Renegotiation and benchmarking are essential.

Staffing Gaps & Workflow Inefficiencies

Coder burnout, insufficient back-office staff, high turnover all disrupt RCM. The AAPC notes 35% of providers cite staffing as their top revenue challenge.

How to Get Paid Strategies That Work

1. Verify Early: Registration + Eligibility

Build patient checks into the process: verify insurance and demographics at intake—and ideally again 24 hours before service. Automate with eligibility tools to avoid manual missteps .

2. Automate Billing Accuracy

Use claim-scrubbing or AI coding tools audited by focused staff. Regular coder training, internal audits, and staying on top of CPT/ICD changes reduce errors . AI assistants are emerging as an RCM game-changer.

3. Denial Defense & Faster Appeals

Track denial codes and implement daily review routines. Assign responsible staff to appeal most denials (>50%) can be reversed. Automate reminders and workflows.

4. Point-of-Service & Digital Collections

Patients are more likely to pay when invoices are current and available. Offer in-person, portal, and text-based payment options. Front-desk training is key to capture co-pays and deductibles .

5. Build Transparency & Trust

Provide good-faith estimates and break down statements. Avoid surprise bills. Align financial practices with transparency to boost compliance.

6. KPI-Driven RCM

Set and review metrics: Aim for 95% net collection rate, denial rate <5%, Days A/R <35, clean claim rate >98%, portal use >60%. Share reporting with leadership and hold teams accountable.

7. Staff Smart & Outsource Wisely

Based on workload, optimize staff levels. Consider outsourcing coding or billing overflow. Leverage RCM firms to close gaps.

8. Fee Schedule & Payer Contracts

Benchmark fees and contract terms annually. Adjust based on inflation, resource cost, and payer mix.

Real Outcomes & What’s Next

Success Stories

• Family Clinic: Cut denial rate from 18% to 8%, boosting collections 12%.

• Dermatology Practice: Implemented patient portal & text-pay portal usage hit 70%; patient payments grew 35%.

• Orthopedic Multi-Specialty Group: Reduced Days A/R from 60 to 30; staffing and process redesign credited.

Impactful Metrics

• Net Collection Rate: Target ≥95% .

• Days A/R: Drop to ≤35 days.

• Denial Rate: ≤5%.

• Patient Portal Usage: ≥60%.

• Fee Write-off: Keep <2%.

The Future: AI + RCM + Compliance

Emerging AI tools can automate code correction, denial prediction, and personalized reminders—reducing manual errors . Blockchain pilots aim to improve payment transparency . Regulatory scrutiny and No Surprises implementations will increase transparency demands.

Final Thoughts: Get Financially Healthy Now

If your practice isn't consistently collecting revenue, it’s not just a billing problem it’s a systems issue. Even small improvements can yield big returns. Start with an RCM health check:

1. Audit the intake and eligibility workflow

2. Deploy coding quality tools and regular training

3. Implement denial tracking and fast appeals

4. Push point-of-service payments & multichannel billing

5. Build transparency and trust in fee communication

6. Monitor KPIs and adjust monthly

7. Right-size your team and outsource smart

8. Stay ahead with AI and contract reviews

By treating revenue cycle health with the same attention as patient care, you’ll close revenue leaks, improve patient trust, and build a financially resilient practice.