Practicing Independence
Chapter 2
Financial Clarity
Know the five numbers that run your practice
2 hours with your administrator
Most independent practices are not short on data. They are short on a small set of numbers everyone trusts and reviews on the same cadence. Financial clarity is the difference between reacting to a bad month and seeing it coming.
This chapter builds a single page of practice economics: what you produce, what you collect, what it costs to deliver, and what is left. Once that page exists, every operational decision gets easier.
The five numbers
- Net collections per provider per day
- Payer mix and contracted rate performance
- Cost per encounter, including staffing
- Days in accounts receivable and denial rate
- Operating margin by service line
Why this matters
Practices that lose independence rarely lose it on clinical quality. They lose it because margin eroded quietly for eight quarters and nobody had a number that made it visible.