How to evaluate subrogation performance: metrics that matter

Rising healthcare costs, increasing third-party liability cases, and tightening regulatory requirements are driving higher demand for more effective subrogation services in the healthcare industry. Once viewed as a supporting function, subrogation has evolved into a strategic lever for improving financial performance by ensuring health claims are appropriately paid by the responsible party.

Traditional subrogation programs often rely on manual processes and fragmented systems, making it difficult to recover efficiently or maintain a smooth member experience. In contrast, modern programs — like Carelon’s — use advanced data, predictive modeling, and smart case identification to improve recovery rates, streamline operations, and optimize resources.

Improving subrogation performance requires more than volume — it requires visibility into how well your program identifies leads, converts recoveries, and manages costs. Metrics that capture these outcomes reveal what’s working, where gaps exist, and how to drive more consistent results. With the right data in place, plans can evaluate performance more effectively and act with greater speed, precision, and impact.
 

Benchmark your subrogation program

Subrogation programs typically follow a multi-step process that involves:

• Identifying recovery opportunities.
• Investigating case details to determine liability.
• Managing cases through each stage of the recovery effort.
• Recovering funds through settlements and reimbursements.

Each step plays a role in overall performance — but without clear measurement, it's difficult to know where your program is excelling or falling short. The following seven metrics help you evaluate those stages and uncover opportunities for smarter, more efficient recoveries.
 

1. Identification rate

measures the ability to identify subrogation leads from total claims. A higher rate means more subrogation opportunities are found at the onset, widening the recovery scope.

Why it matters
This vital metric captures the volume of cases entering the subrogation process, directly impacting the opportunity to recover costs and effectively manage financial liabilities.
 

2. Throughput rate

measures the ability to convert identified subrogation leads into real recoveries. Strong throughput rates reflect a seamless process from lead identification to recovery, which reduces delays and keeps recoveries on track.

Why it matters
Higher conversion rates lead to higher successful outcomes. They reveal how efficiently and effectively your process drives recoveries.
 

3. Recovery rate

represents the percentage of claim dollars, identified through subrogation leads, that were successfully recovered. A higher recovery rate suggests improved identification and processing, often aided by automation, predictive analytics, and smarter case prioritization.

Why it matters
The recovery rate directly reflects the total success of the subrogation program. Sustaining high performance in this area is essential for maintaining long-lasting, impactful results.
 

4. Cycle time

measures the span from forming a subrogation case to recovery. Shorter cycle times reflect streamlined workflows and effective management resulting in faster and greater cost savings.

Why it matters
Faster cycle times accelerate recoveries and improve cash flow, allowing health plans to reinvest savings sooner. They also reflect strong process execution, reducing administrative burden and enhancing overall efficiency.
 

5. Cost of recovery

weighs the subrogation effort expenses against the total recovery amounts. Legal fees and administrative costs must be kept much lower than recovery amounts to drive net gains.

Why it matters
It ensures that recovery efforts are financially viable and strategically aligned with organizational goals.
 

6. Legal success rate

tracks winning outcomes from legal actions taken on claims. It shows the strength of the program’s legal strategy and resource allocation and how they impact the recovery success.

Why it matters
It reflects the effectiveness of legal strategy and resource allocation, influencing overall recovery success. It ensures that the legal actions contribute measurable value.
 

7. Compliance rate

measures how closely you adhere to legal and regulatory needs throughout the subrogation process. A stronger compliance rate leads to reduced risks

Why it matters
Monitoring your compliance rate safeguards against legal and operational risks, ensures ethical conduct, and maintains positive relationships with your program's stakeholders.
 

Best practices for boosting success

Focusing on the metrics above can increase efficiencies, reduce costs, and help improve financial performance. In addition, a subrogation partner that consistently employs the following best practices can drive these outcomes by:

• Leveraging predictive analytics and machine learning models that automatically identify leads, ensuring a larger percentage of likely recoveries are found early in the process.
• Streamlining internal processes and improving collaboration with partners to drive swift, impactful action on identified leads.
• Refining successful recovery strategies, sharpening negotiation tactics, and focusing efforts on high-yield opportunities.
• Using automation to accelerate claims processing, minimize manual touchpoints, and reduce overall cycle times.
• Leaning into technology to reduce administrative burdens and adopting clear pricing models that avoid added fees to align costs with recovery gains.
• Refining the criteria for determining which cases warrant legal action and investing in skilled legal professionals to improve legal outcomes.
• Setting robust compliance rules, conducting frequent audits, and providing constant staff training on regulatory changes.
   

How Carelon’s full-service subrogation delivers value

At Carelon, our end-to-end subrogation services are built for performance, precision, and partnership. By leveraging predictive analytics and expansive data sources, we identify recovery opportunities earlier and with greater accuracy — reducing cycle times and minimizing member disruption.

Our clients benefit from higher recovery rates, improved cost containment, and streamlined operations. With advanced systems, expert legal insight, and a focus on continuous optimization, we turn subrogation into a true strategic asset. We don’t just track performance — we improve it, with transparent data and measurable results.

Since 2021, we’ve recovered over $2 billion for our clients, with an average recovery cycle of less than one year.

Discover how much more your subrogation program can achieve — with Carelon