Operating a medical practice in the USA means more than simply seeing patients. It is essential for physicians to determine if the practice is earning money efficiently, managing operating expenses, paying salaries, and creating sufficient cash flow to drive growth in the future.
A financial report may have many figures, but a medical practice owner does not need to assess all of them daily. Instead, a carefully selected group of financial indicators will give a more comprehensive picture of the practice’s financial position.
The 2026 MGMA financial and operations data highlight some of the indicators, such as revenue, operating expense, salaries, operating margin, payer mix, account receivables, and revenue cycle performance.
With the right healthcare accounting services, practices can turn financial data into useful information rather than allowing important numbers to remain buried in accounting reports.
9 Financial Numbers Every Doctor Should Watch
The following are nine financial figures that all physicians should consider tracking regularly.
1. Net Patient Revenue
Net patient revenue reflects the actual level of revenue expected from patients after accounting for contractual adjustments and other reduction factors.
Only focusing on gross charges may give an erroneous picture of the financial situation because gross charges do not reflect the total cash collected.
Physicians should review net patient revenue trends and understand the reasons behind any fluctuations in the revenue. They may relate to patient volume, reimbursement, payer mix, services rendered or collections.
This number is critical for assessing whether the practice is earning enough revenue to cover its operational costs.
2. Operating Expenses
Not only revenue determines profitability. Even if the revenue increases, the practice can experience worsening in its financial state if operating expenses grow faster.
Some of the possible items of operating expenses are the following:
- Salaries and wages
- Rent and facilities
- Medical supplies
- Insurance
- Technology and software
- Billing expenses
- Professional services
- Equipment and maintenance
MGMA 2026 data in particular addresses the percentage of the revenue spent on operating expenses per every revenue dollar.
Physicians should look at their major expense lines on a regular basis, not just waiting until year-end.
3. Operating Margin
Operating margin indicates the proportion of revenue remaining after operating expenses.
It may mean that the expenses related to labor, supplies, technologies, facilities, or others have grown faster than the revenue growth.
Furthermore, margins must be analyzed with regard to their dynamics since seasonal variations, acquisitions of expensive equipment, labor changes, or other changes in the payers' structure may affect margins in one month.
Nevertheless, a persistent decrease in the margin requires further analysis.
4. Days in Accounts Receivable
Days in accounts receivable (or A/R days) show the time needed to collect the payments that have been billed by the practice.
For a practice owned by physicians, days in A/R is one of the key figures as revenue on paper cannot pay salaries and operating expenses unless it is turned into cash.
According to the American Medical Association, days in A/R is one of the most telling indicators of the financial situation of a private physician practice since the 30–45 days are indicative of timely payments, whereas 90 days and above show problems with revenue cycle.
Physicians must also analyze the A/R aging to learn how much money there is in the categories of 61-90, 91-120, and 120+ days.
5. Net Collection Rate
The net collection rate is a measure of how successfully the practice manages to collect its rightful dues.
MGMA considers collection ratios as a critical revenue cycle key performance indicator, and their recommendations have always considered the minimum net collection rate to be 95% and above.
A low collection rate could be a sign of some problems related to claims, payer agreements, patient balances, write-offs, or follow-up.
Physicians should consider this ratio in conjunction with the A/R days instead of relying on just one metric.
6. Claim Denial Rate
Claim denial rate is the percentage of the claims rejected by payers.
The reasons for rejection may include the errors in patient information, wrong coding, lack of documents, authorization and eligibility issues, or payer requirements.
According to the MGMA poll conducted in January 2026, the issues of denials and appeals were named as the greatest revenue cycle leak by 48% of the respondents, followed by front-end issues, billing, and coding.
AMA suggests tracking denial rates, and sets the goal below 10% in its revenue cycle guidelines.
It is more important, however, to find out the reasons for claim denial.
7. Revenue Per Physician
The measure can help practice owners gauge productivity and financial performance of physicians.
Factors influencing this number include specialty, payer mix, procedure volume, patient volume, physician utilization, and reimbursement, and therefore, it should not be seen as a universal measure of productivity.
However, physicians can use it for trend identification for their own practices.
If patient volume stays constant while revenue per physician declines, then the practice would have to consider factors such as coding, charging, reimbursement, services offered, and scheduling.
8. Staffing and Payroll Costs as a Percentage of Revenue
Medical practice usually has high staffing costs.
Physicians should track the payroll and benefits as a percentage of revenue and not just salary for an individual.
It can assist in answering the following questions:
- Is the staff expanding faster than revenue?
- Are the administrative positions adding enough value to operations?
- Is overtime becoming too much?
- Is there some way to automate some of the administrative functions?
- Is there a shortage of billing/collections staffing?
The MGMA financial report from 2026 specifically includes staffing economics and support staff cost among the financial measures of practice performance.
9. Cash Flow
Profit does not necessarily equal cash flow.
An office can have profits but still be struggling with cash because the money is late, accounts receivable is building, bills are coming due before payments are received, or major purchases have used up cash reserves.
Physicians need to know their cash position, their collections, their upcoming payroll, taxes, bills, debt repayments, and capital outlays.
A basic cash flow forecast will provide advance warning of any shortages. This is where healthcare accounting services can provide practical support.
How Medical Practice Accounting Can Make These Numbers Easier to Track
Most doctors lack the time to balance accounts, A/R aging analysis, expense tracking, and generating monthly financial reports by themselves.
An accounting department will assist in keeping books, balancing accounts, preparing financial statements, expense tracking, and organizing information to let doctors see practice performance in a better way.
If a medical practice runs more complicated operations, outsourced accounting services for healthcare can be used as an additional option to perform ongoing financial reporting and accounting without having a large accounting department inside the practice.
When It Is Time to Use Outsourcing Services
If a practice is expanding, then sooner or later there might be too many financial duties for an administrative team.
Accounting outsourcing services for healthcare can assist in performing regular bookkeeping, reconciliations, reporting, accounts payable, payroll accounting, and other financial activities.
However, it is not the only aim of the process. The idea is to get the proper structure that would allow doctors to receive more detailed information about finances while letting internal employees deal with their duties.
For practices that require a special approach, doctors can also use outsourcing healthcare accounting services.
Physicians don’t have to learn accounting to know the financial well-being of their practices. But they need insight into the figures that influence their cash flows, profitability, and stability.
Patient net income, operating expense, operating margin, A/R days, collections rate, denial rate, per-doctor revenue, labor cost, and cash flow form a useful financial dashboard.
Regular tracking of these figures together with The Fino Partners will help doctors detect issues early and make better-informed decisions related to staffing, pricing, technology, growth, and revenue cycle management.
