Healthcare reimbursement has changed dramatically over the past decade.
There is a widening distance in U.S. healthcare reimbursement, and most practice owners feel it before they can name it. Collections soften. A/R creeps up. Denials that used to get worked now sit. Nothing is obviously broken — and that is exactly what makes the revenue operations gap so dangerous.
The gap is the growing space between how sophisticated the reimbursement environment has become and how well the average independent practice is equipped to manage it. On one side, payers deploy automated audit and prior-authorization tools at scale. On the other, EHR and revenue cycle management vendors automate coding and claim submission. In the middle sits the practice.
Yet many healthcare practices continue to manage revenue using operational models that were designed for a much simpler environment. This has created what we call the Revenue Operations Gap.
The Revenue Operations Gap is the growing distance between reimbursement complexity and a practice’s ability to manage it effectively.
At first glance, many practices appear to be functioning normally. Claims are being submitted. Payments are arriving. Reports are being generated. However, beneath the surface, important questions often remain unanswered:
Where is revenue being delayed?
- Which denial categories are increasing?
- Which payers are creating the greatest friction?
- How quickly are reimbursement issues being identified and resolved?
- Who is accountable for addressing systemic revenue challenges?
It’s not a billing problem
This is the insight most practices miss. If claims are going out, owners assume revenue is handled. But the gap rarely shows up at submission. It shows up after: in denials that go unworked, in underpayments nobody catches, in accounts receivable that ages past the point of recovery, in payer changes nobody notices until cash drops.
The benchmarks make the cost concrete. MGMA guidance puts a healthy days in A/R at under 40 days, with high performers under 30, and net collection rates of 96–97% for practices collecting effectively. When the revenue operations gap opens, those numbers drift the wrong way — and a few points of net collection on a multi-million-dollar practice is real money walking out the door.
There is another question that many practice leaders rarely ask: Is our organization the only one facing these challenges?
The three dimensions of the gap
In our work, the gap almost always has three layers:
Visibility. Most practices see total collections but not the leakage beneath — denials by category, underpayments by payer, A/R by age. They’re flying on one gauge.
Intelligence. A single practice can’t tell whether a denial spike is its own coding issue or a market-wide payer shift. Without an external vantage point, every problem looks like an internal failure (or gets ignored as noise).
Ownership. No single person is accountable for revenue performance end to end. Claims go out, reports come in, problems accumulate — until they become a cash-flow crisis with no clear owner.
Closing it
Closing the revenue operations gap doesn’t require more billing software. It requires restoring those three things: clear visibility into where revenue is leaking, intelligence drawn from across many practices, and one person who owns the outcome. Your EHR vendor automates the claim. Someone still has to own what happens to it
Billing gets claims out the door. Revenue operations makes sure practices get paid.
The organizations that understand this distinction early will be better positioned to succeed in an increasingly complex reimbursement environment.
Questions worth discussing with your team:
- Can you see your denials broken down by root cause and payer this month — or only your total collections?
- If a payer changed its rules tomorrow, would your practice detect it in weeks, or only after the cash dried up?
- Who in your practice is accountable for the outcome of a claim, not just its submission?
References:
- MGMA revenue cycle benchmarks — https://www.mgma.com/articles/finding-the-right-revenue-cycle-benchmarks
- Kodiak Solutions 2024 revenue cycle data (A/R days up 5.2% YoY), via Becker’s — https://www.beckerspayer.com/payer/claims-denial-rates-up-prior-auth-denials-down-in-2024-report/