Days in AR (days in accounts receivable, or DAR) is the average number of days it takes a medical practice to collect payment after services are rendered, calculated by dividing the total AR balance by average daily net revenue — a measure of billing cycle speed and efficiency.
Days in AR is calculated by dividing the outstanding accounts receivable balance by average daily net revenue (total collected revenue over a period divided by the number of days in that period); a result of 40 days means the practice has, on average, 40 days of revenue outstanding and waiting to be received. Industry benchmarks vary by specialty: primary care practices typically target 30–35 days, specialty practices 35–45 days, and surgical specialties can run 40–55 days depending on procedure mix and payer complexity; sustained days in AR above the 90th percentile for the specialty indicates systemic billing cycle problems. Days in AR is most meaningful as a trend rather than a point-in-time value: a practice at 40 days that has risen from 33 days over the past quarter is experiencing a billing slowdown that will impact cash flow within 45–60 days; a practice at 40 days declining from 48 days is improving, even though the current number looks identical. Common drivers of elevated days in AR include high denial rates that push claims into multiple submission cycles, slow payer processing, inadequate denial follow-up staffing, and patient balance collection failures. Harine Management tracks days in AR as a weekly trend line, surfacing directional changes within days of them beginning rather than weeks after they appear in monthly financial statements.
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