Redefining healthcare financial KPIs in a post-COVID era: A strategic imperative

The COVID-19 pandemic compelled hospitals and health systems to rethink nearly every aspect of their operations. Nowhere was the disruption more profoundly felt than in the revenue cycle. Long-standing financial key performance indicators (KPIs) such as accounts receivable (AR) days, clean claim rates and denial percentages, quickly lost their relevance amid staffing shortages, unpredictable patient volumes, delayed reimbursements and rapidly evolving patient expectations.

The ripple effects continue. Payer mixes have shifted, self-pay volumes are growing and patients now expect a digital experience that mirrors other consumer-facing industries. The rise of high-deductible health plans has significantly increased patient financial responsibility, contributing to the growth in self-pay volumes. At the same time, healthcare organizations are being pushed to adopt digital tools that meet evolving consumer expectations for transparency and convenience in the payment process. Meanwhile, staffing challenges persist, making operational stability even harder to maintain. In this new landscape, traditional KPIs no longer offer the clarity they once did. What previously served as guideposts may now obscure what matters most.

To thrive in this environment, healthcare financial leaders must redefine how they measure success. Modern KPIs should reflect current realities, prioritizing resilience, agility and a patient-centered financial experience. The organizations that succeed will be those that adapt their performance metrics to align with today’s demands, rather than yesterday’s benchmarks.

Why traditional KPIs alone no longer cut it

Metrics like clean claim rates and gross collection percentages once served as reliable indicators of financial health. But those benchmarks were built on the assumption of stable environments and predictable processes, conditions that no longer exist.

Today’s reality is far more complex. Persistent workforce shortages, growing patient financial responsibility, and the transition to value-based care have fundamentally reshaped revenue cycle dynamics. Traditional KPIs often fail to reflect these challenges. They overlook the real friction points: patients struggling to navigate financial obligations, staff overwhelmed by manual processes and delays in reimbursement that strain cash flow.

HFMA’s revised MAP keys reflect a shift in focus. Simply measuring claim accuracy or collections isn’t enough. True success now requires a broader view — one that prioritizes operational resilience, cross-functional collaboration and a patient-first approach to financial engagement.

Emerging KPIs that matter in today’s environment

More data isn’t the answer, better discernment is. Healthcare organizations are already inundated with information, but sheer volume doesn’t translate to clarity. What’s needed are metrics that pinpoint where processes are faltering and guide meaningful action.

The most effective KPIs are those that influence day-to-day decision-making. They help leaders identify issues early, correct course quickly and ensure that the revenue cycle contributes to, rather than detracts from, financial stability.

If a metric doesn’t drive action, it’s not worth tracking. In fact, irrelevant data can bog down teams, create noise and foster a false sense of progress. Every KPI should serve a clear purpose: to inform, direct and improve. Anything else only adds complexity without value.

In today’s environment, clarity and focus are essential. The right KPIs don’t just measure performance, they enable it.

Patient financial experience metrics

The patient financial journey is not separate from the care experience. Instead, it’s an essential part of it. Patients don’t distinguish between their clinical treatment and the way their billing questions are handled. A confusing or inflexible payment process can quickly erode the trust built during clinical care.

That’s why the right financial experience metrics are critical. Patient satisfaction scores reveal more than courtesy; they reflect whether patients felt understood and supported throughout the billing process. Adoption rates for digital payment tools indicate whether the system is meeting modern expectations. And adherence to payment plans shows whether those plans are truly manageable. When patients disengage, it’s not a compliance failure, it’s a sign the system isn’t working for them.

Operational resilience metrics

Persistent staffing shortages have tested the limits of traditional workflows. While some organizations have embraced automation and remote work to adapt, others still rely on inefficient workarounds.

Modern metrics must go beyond basic output. They should uncover operational stress points. Productivity per full-time equivalent (FTE) and automation usage can highlight where efficiencies are improving, and where manual tasks continue to bog down progress. Metrics that track remote workforce performance offer insight into the effectiveness of distributed teams. First-pass resolution rates and payer response times reveal where delays cost time and money. Every inefficiency carries a price, and it’s one that health systems can’t afford to overlook.

Financial sustainability metrics

Financial sustainability isn’t a single metric, it’s a condition that reflects whether an organization is delivering value on every patient encounter. Metrics like net revenue yield per encounter help distinguish between being busy and being profitable. Point-of-service collections are important, but only if the cost to collect doesn’t outweigh the returns. And days cash on hand can be misleading if it doesn’t account for payer delays. Ignoring those lags turns financial planning into guesswork.

These aren’t theoretical concerns, they’re active pressures shaping decisions every day. Without real-time visibility into these factors, organizations aren’t mitigating risk. They’re simply missing it.

Best practices for KPI redesign and implementation

Redefining KPIs isn’t just about selecting new metrics, it’s about creating alignment across the organization and committing to act on what the data reveals.

The first step is to ensure every KPI is directly connected to a core organizational objective. Whether the priority is expanding market share, strengthening patient loyalty or improving financial margins, the metrics must clearly reflect those goals. If a KPI doesn’t support a defined business priority, it doesn’t belong on the dashboard.

True transformation happens when metrics are not only tracked but trusted, used consistently to inform decisions and drive measurable change across the enterprise.

That transformation begins with visibility. Real-time reporting and intuitive visualization tools are essential to make data actionable. Monthly reports are too slow for today’s fast-moving challenges. Teams on the front lines, as well as executive leaders, need immediate feedback loops to adjust in the moment and remain accountable.

Equally important is ownership. The most effective KPI frameworks are built collaboratively. Finance, revenue cycle, information technology and patient access each offer a unique lens on shared objectives. When these perspectives are brought together, the result is a set of metrics that are not only accurate but relevant and widely supported across the organization.

Healthcare finance leaders now face a critical inflection point. The metrics and systems that served the pre-2020 environment are no longer enough. The current landscape demands a shift from measuring what’s familiar to measuring what truly matters.

This doesn’t mean abandoning all legacy KPIs. It means refining focus, elevating the metrics that reflect today’s operational complexity and retiring those that no longer serve a purpose. In this new era, success will be defined not by the volume of data, but by the ability to ask smarter questions and use metrics to answer them.

When you measure the wrong things, you solve the wrong problems. Now is the time to reset. To let go of outdated benchmarks. To adopt metrics that actually drive outcomes. The organizations that make this shift won’t just adapt to the future of healthcare finance, they’ll define it.