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Do hospitals and other companies write off insurance difference
Posted on 9/12/15 at 7:31 pm
Posted on 9/12/15 at 7:31 pm
Just wondering if hospitals, body shops and other companies that deal with insurance write off the difference of unpaid bills.
For example a hospital bills for 1000 dollars for stitches but the insurance company only pays $500.
Does the hospital get to claim a loss of $500
If so that seems like a huge benefit.
For example a hospital bills for 1000 dollars for stitches but the insurance company only pays $500.
Does the hospital get to claim a loss of $500
If so that seems like a huge benefit.
5
Posted on 9/12/15 at 9:44 pm to Rust Cohle
I think at the end of the day it's just collections vs expenses. Could be wrong though.
Posted on 9/12/15 at 11:20 pm to Rust Cohle
Some of this depends on the structure of the hospital. For-profit, non-profit vs not-for-profit. There are opportunities to write off bad debt and charity for hospitals. Probably not in the circumstance that you outline. These write offs are generally reserved for treating the uninsured.
If the hospital receives the agreed upon contractual payment from the insurer its revenue. If the hospital receives less than it cost to care for the patient there probably should be a job opening in the Contracts Dept.
If the hospital receives the agreed upon contractual payment from the insurer its revenue. If the hospital receives less than it cost to care for the patient there probably should be a job opening in the Contracts Dept.
Posted on 9/13/15 at 2:25 pm to Rust Cohle
Not really. I have several medical practices as clients and they book the revenue at full freight, book the amount the client doesn't pay in cash at time of visit as a receivable, then have a huge allowance for collectible accounts based on historic factors.
So they might book 1,000 as income, but write off 800 down the road.
Not really a difference between that, and just booking 200 as income.
So they might book 1,000 as income, but write off 800 down the road.
Not really a difference between that, and just booking 200 as income.
Posted on 9/13/15 at 4:36 pm to Rust Cohle
For hospitals, if they have contracts with the insurance company, they write off the difference between what their charges are and what they actually get paid per their contract. It is called a contractual allowance and is basically a reduction in revenue.
Posted on 9/15/15 at 1:58 am to Rust Cohle
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