Medical Billing
Revenue Loss Calculator

The average physician practice operates at an 82–87% net collection ratio — losing 13–18% of earned revenue to preventable billing failures. For a $1M annual practice, this is $130,000–$180,000 per year. Leakage comes from: claim denials and unworked AR (~45%), underpaid claims (~22%), uncollected patient balances (~18%), and front-office errors including eligibility errors and no-shows (~15%). See our Revenue Cycle Management page for the complete framework.

Underpaid claims occur when a payer reimburses less than the contracted rate for a service — due to payer processing errors, incorrect fee schedule application, or unjustified adjustments. Unlike denied claims, underpaid claims are paid — making them invisible without systematic reconciliation against contracted rates. Studies estimate 2–7% of paid claims contain underpayments. XMB’s payment posting process reconciles every ERA against the contracted fee schedule for each CPT code and payer, identifying underpayments and filing appeals. See our Medical Billing Services.

Patient balance collection failures happen when: patients aren’t informed of financial responsibility before the visit (creating surprise billing disputes), statements are unclear or contain errors, there’s no systematic follow-up process for unpaid balances, and payment plan options aren’t offered for larger amounts. With high-deductible health plans making patients responsible for more of their care cost each year, improving patient collection workflow has become one of the highest-impact revenue improvements a practice can make. XMB’s Virtual Assistant services handle proactive patient balance communication and payment coordination.

The highest-impact billing errors are: (1) systematic undercoding — $40K–$150K annually for an active practice; (2) unworked denied claims — 50–60% never followed up; (3) eligibility-based denials from no pre-visit verification; (4) missed prior authorizations — no retroactive fix; and (5) timely filing violations — 100% unrecoverable. XMB’s free practice audit identifies all of these in your specific practice with exact dollar-impact estimates. Source: MGMA / CMS.