How to Build a Contract Health Score for Your Dental Practice A Contract Health Score tells you how much of your insurance revenue comes from contracts that pay well. It's one ratio: collections from your healthy carriers divided by all your insurance collections. You can calculate it yourself in five steps from a standard PMS export, and a strong result is 70–90%. Total collections can look fine while too much of your chair time goes to plans that write off a big share of every fee. This score shows you that mix in a single number. Contract Health = collections from healthy carriers ÷ total insurance collections. One ratio, not a composite score. A carrier counts as healthy when its contracted rate (what the contract allows ÷ your billed fee) is 75% or more, in line with industry-accepted benchmarks. A strong result is 70–90%. Below that, the carriers pulling it down are your first renegotiation targets. The catch: low fees make every contract look healthier than it is. Check your fees before you trust the score. Why does contract health matter more than total collections? Total collections tell you how much came in. They don't tell you what it cost you to earn it. A practice can post strong collections while a large slice of its schedule runs through plans that allow far less than its full fee. That pressure is why so many practices are re-examining their networks. The ADA reported that 23% of dentists dropped insurance networks in 2024, with another 33% considering it for 2025. A Contract Health Score lets you make that call with numbers instead of frustration. The danger isn't a bad contract you know about — it's the average that lets a bad contract hide inside a healthy-looking number. How do you calculate a Contract Health Score? You need three figures per carrier for the same 12 months: billed fees (at your full fee), contractual write-offs, and collections. Most PMS systems export these by carrier. Find each carrier's allowed amount. Allowed = billed fees − contractual write-offs. Calculate each carrier's contracted rate. Contracted rate = allowed ÷ billed fees. If you billed $10,000 and the contract allowed $7,200, the contracted rate is 72%. Mark each carrier healthy or not. A contracted rate of 75% or more is healthy, in line with industry-accepted benchmarks. Add up collections from the healthy carriers. Use what each carrier actually paid, not what it allowed. Divide by total insurance collections. The result is your Contract Health Score. What does a worked example look like? Here's a practice with four carriers over 12 months: Carrier Billed fees Write-offs Contracted rate Healthy? Collections Plan A $400,000 $80,000 80% Yes $290,000 Plan B $300,000 $66,000 78% Yes $210,000 Plan C $350,000 $119,000 66% No $200,000 Plan D $200,000 $90,000 55% No $100,000 Collections from healthy carriers: $290,000 + $210,000 = $500,000. Total insurance collections: $800,000. Contract Health Score: $500,000 ÷ $800,000 = 62.5%. That's below the 70–90% range. Plans C and D bring in $300,000 of collections, and together they wrote off $209,000 of the practice's full fees. They're the first place to look. What's a good Contract Health Score? A strong result is 70–90% of your insurance collections coming from healthy contracts. Where you land tells you what to do next. If your score runs low, too much revenue is tied up in contracts that allow a small share of your fee: Identify the drag. The carriers below 75% with the most collections move the score most. Renegotiate from strength. Bring your numbers to those carriers at renewal. Here's how to renegotiate a PPO contract from strength. Weigh the volume. A low-rate plan that fills your schedule may still earn its place. See which carriers are worth keeping. Communicate clearly if you do leave a network, so patients know how continuing care works. If your score runs high, that's a strong position. Keep checking it, since contracts and carrier policies change over time. What's the catch most practices miss? The contracted rate compares what a carrier allows with your fee. If your fees sit well below your local market, the gap between your fee and the allowed amount shrinks, and every contract looks healthier than it really is. A practice with low fees can post a high score while leaving money on the table on every procedure. That's why the order matters: raise your fees first, then renegotiate. Check where your fees sit before you trust the score. If you're not sure, start with is my dental fee too low? What's the broader trend behind all this? Leaving a network has grown more common: 29% of dentists dropped insurers in 2025 (Becker's Dental), with low reimbursement and administrative burden cited again and again. On the patient side, DPPO enrollment declined 1.9% in 2024 (NADP). 30–40% of gross production lost to PPO write-offs (ADA 2023 Dental Fees Survey) Practices that track contract health are better placed to adapt, and to keep their revenue where it pays. Frequently asked questions What is a Contract Health Score? It's the share of your insurance collections that comes from carriers with a contracted rate of 75% or more, in line with industry-accepted benchmarks. It shows whether your revenue leans on contracts that pay well or on plans that write off a large share of your fees. How do I calculate it? For each carrier, divide what the contract allows by your billed fees to get the contracted rate. Add up collections from the carriers at 75% or more, then divide by your total insurance collections. What's considered a good score? A strong result is 70–90% of your insurance collections coming from healthy contracts. Where exactly you land matters less than knowing the number and watching its trend. Can a good score be misleading? Yes. The contracted rate is measured against your own fees, so fees set well below your market make every contract look healthier. A high score with low fees can hide a large gap. Check your fee position first. What should I do if my score is low? Find the carriers below 75% that bring in the most collections, and bring a documented, numbers-based request to them at renewal. If a plan still doesn't earn its place after that, weigh its volume before deciding whether to leave. How often should I check it? Once or twice a year is a good rhythm, and again before any contract renewal. Regular review lets you catch changes early. See your Contract Health in minutes You can run this by hand, but pulling the figures carrier by carrier takes time. Igion's Carrier Profitability Scorecard™ ($149) reads your PMS export, shows your Contract Health in one chart, and ranks every carrier by contracted rate as Keep, Negotiate, or Reconsider. The Practice Intelligence Bundle / "The Practice Playbook" ($199) adds fee benchmarking against federal-grade, public-domain, carrier-bias-free benchmark data, modeled to ZIP, so you can raise fees first, then renegotiate from strength. See my numbers, or read What Is a Good Net Reimbursement Rate for a Dental Practice? and How to Analyze Your Dental Insurance Contracts for Profitability next.