If you do discount the service, remember to submit the claim for the altered fee, as you cannot discount the fee to patient and charge the payer the full fee.īad debt write-offs are balances that you have decided to write-off and not pursue further. If the patient has a very bad experience in the practice, the manager may want to discount the service or to write-off the charge completely. For instance, if the practice assures the patient that they are participating with the patient’s insurance, then it turns out that the practice is not in-network, the manager may approve a write-off based on the practice’s error. Uncredentialed provider write-offs are those caused by filing a claim for a provider before they are credentialed with the payer.Īdministrative write-offs are those approved by the manager based on service issues. (Make sure you know your timely filing limits for each payer.) Commercial payers usually have very tight timely filing limits and most average three months. Medicare requires that claims be filed no later than 12 months after the date of service to be paid. Timely filing write-offs are caused by filing the claim past the date required by the payer. These are write-offs that you have not agreed to and you reluctantly reduce the charge based on billing mistakes or situations that you should have been able to control, but were not. Prompt payment discounts and self-pay (no insurance) discounts are write-offs for patients paying in full at time of service, and/or patients who receive a discount off the retail price because they do not have insurance coverage. Others run a special small balance statement run once a quarter. Many practices write off the small balance (usually $15 or less) and collect it when the patient returns. Small balance write-offs are amounts left on the patient’s account that may not warrant the cost of sending a bill, which has been estimated to cost about $12.00 each, taking into account the statement process, as well as the cost to receive the check, post it, and deposit it. Charity write-offs may be in accordance with a community indigent care effort, a policy adhered to in a faith-led healthcare system, or a financial assistance program. These are write-offs that you have agreed to, either in the context of a contract, or in terms of your practice philosophy.Ĭontractual write-offs are the difference between the practice fee schedule and the allowable fee schedule you’ve agreed to accept.Ĭharity write-offs are the difference between the practice fee schedule and anything collected. There are lots of reasons why write-offs are taken, and it is common practice to divide write-offs into two major categories. A write-off is an amount that a practice deducts from a charge and does not expect to collect, thereby “writing it off” the accounts receivable or list of monies owed them by payers or patients.
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