Why lien realization runs near 47% of billed charges
The number is not a billing failure. It is the arithmetic of a negotiation that happens once, at the end, with a fixed pot.
Across personal-injury medical receivables, collected dollars tend to land somewhere near 47% of billed charges on closed cases. Individual practices range widely — we have measured closed-case rates from the low thirties to the high sixties — but the central tendency is stubborn, and it is stubborn for structural reasons rather than administrative ones.
Three forces set the number
- The settlement is finite. Policy limits, liability disputes, and comparative fault cap the pot before any provider is considered.
- Statutory liens come first. Medicare conditional payments, Medicaid, and ERISA plans have recovery rights that outrank a contractual LOP.
- The plaintiff must net something. An attorney who cannot deliver a meaningful net recovery to the client will reduce provider liens until they can.
What varies, and what doesn't
Case type moves the number a few points. Referring law firm moves it far more — in the books we have computed, the spread between the best and worst firm inside a single practice routinely exceeds twenty points of realization. That is the largest controllable variable most practices have, and almost none of them have measured it.
What does not move the number much: billing software, statement cadence, or collections staffing. These are the levers a practice reaches for first because they are the levers it owns. On lien AR they are close to inert.
Reading your own figure honestly
A rate without a denominator is not a fact. When we report realization we state collected dollars, billed dollars, and the count of closed cases behind it. Below thirty closed cases the figure is directional and should be treated that way — it is a reading, not a conclusion.
Past realization also does not predict future case outcomes. It describes what happened to a book of closed cases in a defined window. That is useful precisely because it is bounded.