Why Cost-to-Collect Is Climbing — and Why the Denominator Matters

"Cost to collect" is one of the most quoted revenue-cycle metrics and one of the most inconsistently measured. Two recent data points explain why the number keeps climbing for most practices — and a third is a reminder that the metric only means something if you know exactly what's in it.

The cost side is genuinely rising

MGMA's June 2025 poll of medical group leaders found that 90% reported year-to-date operating costs higher than the same point in 2024, with the average increase running about 11% year-over-year. Practice leaders pointed to staffing — salaries, benefits, and competitive pay adjustments — as the single biggest driver, ahead of medical supplies, technology, and facilities costs.

Separately, Premier Inc.'s national hospital survey put a number on one specific slice of that cost: the average expense of adjudicating a single claim rose to $57.23, up from $43.84 the prior year, with total claims-adjudication spending across surveyed providers reaching $25.7 billion. That's not the full cost-to-collect figure for a practice — adjudication is one stage of the revenue cycle, not the whole thing — but it's a concrete, rising number for the specific work of getting a claim through to payment.

Why comparing cost-to-collect across practices is harder than it looks

HFMA's MAP Keys initiative — the industry's most widely used revenue-cycle benchmarking framework — organizes performance measurement across 29 standardized KPIs spanning five domains: patient access, pre-billing, claims, account resolution, and financial management. The point of standardizing definitions this way is that "cost to collect" can mean very different things depending on what a given calculation includes:

• Does it count only the billing office's direct labor, or does it also allocate a share of clearinghouse fees, statement/print vendor costs, and bad-debt collection agency fees?
• Is it measured against gross charges or net patient revenue — two denominators that can produce very different percentages for the same dollar amount of RCM spend?
• Does automation spend (clearinghouse subscriptions, eligibility-verification tools, denial-management software) count as a cost-to-collect input, or as a separate technology line item?

A practice that looks like it has a "low" cost-to-collect number relative to a peer may simply be excluding categories the peer includes — not actually running a leaner operation. This is exactly the kind of denominator mismatch that standardized frameworks like MAP Keys exist to solve, and it's worth checking your own calculation against a named methodology before using the number to justify a budget decision either way.

The practical takeaway

With operating costs up across the board per MGMA's data and per-claim adjudication costs rising per Premier's, most practices' cost-to-collect is probably moving in the same direction — up. The useful next step isn't chasing a single target percentage pulled from an industry article; it's confirming your own calculation's definition is stable year over year (so your own trend line is trustworthy) and, where possible, aligned to a named framework like HFMA's MAP Keys if you want to benchmark against peers rather than just against your own history.