Which statement about net patient revenue is correct?

Net patient revenue is defined as the amount of money that a healthcare provider earns from patient services after accounting for adjustments, which include the provision for bad debts. This calculation is significant because it reflects the actual revenue that a healthcare organization expects to collect for the services it has provided, showcasing its financial performance in terms of service delivery.

When patients do not pay for their treatments or when adjustments are made for contractual allowances with insurers, these factors directly reduce the total amount collected. Therefore, subtracting the provision for bad debts from patient service revenue provides a more accurate representation of the revenue that is truly earned and collectible.

This understanding highlights the importance of accurate financial reporting and managing accounts receivable in the healthcare industry, as it allows for better financial planning and resource allocation. The other statements do not accurately describe net patient revenue, as they either confuse revenue with expenses or mischaracterize the nature of net patient revenue itself.