Accounts receivable (AR) is growing, not shrinking, for most U.S. practices in 2026. Initial claim denial rates hit 11.8% industry-wide in 2024 and have continued climbing, which means more claims are landing in appeal queues instead of getting paid on the first pass. If your AR has been quietly creeping upward for months, you’re not alone — but it is fixable with the right follow-up system.
What Is “Days in AR” and Why It Matters
Days in AR measures how long, on average, it takes your practice to collect payment after a claim is billed. The formula is simple: total accounts receivable divided by your average daily charges (annual charges ÷ 365). The lower the number, the faster you’re getting paid.
2026 Benchmarks: What’s Healthy and What’s a Warning Sign
- Physician groups: 30–40 days (target); best-in-class ≤ 25 days
- Multi-specialty clinics: 28–40 days
- Hospitals / health systems: 35–50 days (HFMA: 50 days acceptable ceiling)
- General MGMA threshold: under 40 days; over 60 days is a serious problem
The Real Causes of Aged AR
- No systematic aging review — claims without a specific follow-up action drift toward the 90+ day bucket where recovery odds drop sharply.
- Denials pile up faster than staff can resubmit — every denial left unworked pushes the claim toward a timely-filing cliff.
- Eligibility and COB errors at intake — wrong plan ID or missed coordination-of-benefits generates preventable denials.
- Missed timely-filing and appeal deadlines — once a payer’s window passes, the claim is uncollectable regardless of validity.
- Patient balances go uncollected — co-pays and deductibles are often the last thing followed up on.
- Staffing hasn’t scaled with claim volume — one biller cannot keep pace with a growing practice’s claim volume.
How to Bring Days in AR Down
- Run a weekly aging review by bucket (0–30 / 31–60 / 61–90 / 90+) with a specific next action assigned to each.
- Assign dedicated AR follow-up with a cadence — first payer contact within 48 hours of a claim aging into the next bucket.
- Track denial root cause, not just denial count so patterns get fixed, not just individual claims.
- Use real-time claim status alerts instead of discovering rejections during a weekly batch review.
- Make it easy for patients to pay their portion with payment plans, text-to-pay, and patient portals.
What TBC Solutions Does Differently
Our AR specialists work claims on a fixed cadence by aging bucket, so nothing crosses 30, 60, or 90 days without a documented action already taken. Denials are root-caused and fed back into front-end workflows so the same error doesn’t recur claim after claim. Clients typically see days in AR trend toward the 25–35 day range within one to two billing cycles of onboarding.
Frequently Asked Questions
What is considered a healthy Days in AR for a medical practice?
Under 40 days is the general MGMA benchmark, with best-in-class practices at 25 days or fewer.
At what point is a claim considered “aged” AR?
Most practices flag claims as aged once they pass 60 days without payment, with anything past 90 days considered high-risk for write-off.
Can outsourcing billing actually reduce Days in AR?
Yes — the biggest driver of aged AR is inconsistent follow-up, and a dedicated team working claims on a fixed cadence is usually the fastest way to bring the number down.
How quickly can Days in AR improve after changes are made?
Most practices see measurable improvement within one to two billing cycles (60–90 days) once systematic aging review and follow-up are in place.
Get Your AR Under Control
If your AR has been climbing and no one has time to chase it down, talk to TBC Solutions about a dedicated follow-up plan for your practice.