Wiki Patient Write Offs

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carriganm

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Can anyone send me in the write direction on when a family practice clinic can do "courtesy" write off's for patients not related to financial hardship when we are billing insurance? Meaning, we bill patient's insurance, and patient calls in and complains about 'XYZ' and after review of the patient account, the manager decides to do a courtesy adjustment on the patient's balance. Or provider sees a patient and wants us to bill the insurance carrier, but after insurance pays, we don't bill the patient for any remaining balance for 'various' reasons. Is this allowed? Or does it violate commercial and federal billing guidelines? I have been reading that we can not discount for one patient if we don't discount for all.

Would love some clear knowledge on this topic!
Thank you so much!!
 
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I would strongly advise against this as is almost definitely violates your participating provider agreement with the insurance company.
1) If you know before billing insurance that you would not be billing the patient for their responsibility, you should not be billing the insurance either.
2) An occasional patient write off due to a valid complaint is unlikely to raise any red flags, BUT if it were to be audited, could create a host of issues. I suggest submitting a corrected bill to the insurance with the adjusted amount. For example: your front desk incorrectly told a patient the provider is participating with insurance when they are not participating. $300 was applied to patient deductible. Patient has a valid complaint due to your practice's error and you will only hold the patient responsible for her $50 copay already paid. A corrected bill should be submitted to insurance with the $50 amount so only $50 is applied to deductible.
In the scenarios you described, depending on the circumstances, it could violate anti-kickback laws, Stark laws, or the insurance contract depending on the "various" reasons. For example, provider sees patient who happens to own a local urgent care. Provider chooses not to bill patient for balance because the patient refers a lot of business his way.
Basically you are submitting a false claim to the insurance and you should stay as far away from that as possible.
 
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csperoni said:
I would strongly advise against this as is almost definitely violates your participating provider agreement with the insurance company.
1) If you know before billing insurance that you would not be billing the patient for their responsibility, you should not be billing the insurance either.
2) An occasional patient write off due to a valid complaint is unlikely to raise any red flags, BUT if it were to be audited, could create a host of issues. I suggest submitting a corrected bill to the insurance with the adjusted amount. For example: your front desk incorrectly told a patient the provider is participating with insurance when they are not participating. $300 was applied to patient deductible. Patient has a valid complaint due to your practice's error and you will only hold the patient responsible for her $50 copay already paid. A corrected bill should be submitted to insurance with the $50 amount so only $50 is applied to deductible.
In the scenarios you described, depending on the circumstances, it could violate anti-kickback laws, Stark laws, or the insurance contract depending on the "various" reasons. For example, provider sees patient who happens to own a local urgent care. Provider chooses not to bill patient for balance because the patient refers a lot of business his way.
Basically you are submitting a false claim to the insurance and you should stay as far away from that as possible.
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This is amazing info. THANK YOU!!!
What about time of service discounts? Are we allowed to offer a lower price for patients who pay in full without insurance? I've heard mixed things about this as well.
 
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One of the key elements to doing that within compliance is that it is a "time of service discount". If an insurance company were to pay you at the time of service :ROFLMAO:, you would give them the same rate.
 
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csperoni said:
One of the key elements to doing that within compliance is that it is a "time of service discount". If an insurance company were to pay you at the time of service :ROFLMAO:, you would give them the same rate.
Click to expand...
Okay Christine I've got another question that is related to this. I presented this to my administrators today and they had a couple follow-up questions:
1. What about employee discounts?
a. We have it in our company policy handbook that for any services paid after deductible and/or coinsurance by our insurance, ALL employees receive a 50% discount off their balance? Is this allowed?
2. We provide chiropractic services to our patients and will bill "x" rate to the insurance carrier and if it is applied to the patient deductible, for ALL patients we discount it down to our TOS rates until their deductible is met. I advised them against this as it sounded alarming based on the information you provided above. But, if we are treating ALL patients this way and it is company policy to do this, is it allowed? My first thought is no, because we are discounting the agreed upon patient responsibilities the patient agree to with their insurance. But would love to hear a second opinion on my thoughts.
 
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Both of these sound non-compliant. This is now getting into specific legal issues and you may want to consult appropriately.
Here is my non-lawyer interpretation of these items:
1) If you're billing insurance at the full rate, then discounting the amount the insurance applied as patient responsibility, you are at least violating your contract. You could be doing worse if the insurance is a government payor.
2) See #1.
#1 is less likely to cause you problems as it is only your employees (unless someone is disgruntled) 🤬, but still not compliant. I have worked at small private practices where this was done (even if not compliant). Any larger healthcare system makes it very clear that you must pay your portion, even if you are treated where you work.
#2 the issue would specifically be like my #2 scenario in the original reply. Let's say your TOS rate is $100. Your full rate is $400. Insurance processes claim applying $200 toward $1000 deductible. If patient comes in weekly (and nowhere else), the insurance will be applying full $1000 to deductible, then will start paying their 80/20 or whatever percentage. However, you have no intention of collecting $1000 from the patient and will only be charging the patient $500. You are submitting false claims to the insurance.
 
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csperoni said:
Both of these sound non-compliant. This is now getting into specific legal issues and you may want to consult appropriately.
Here is my non-lawyer interpretation of these items:
1) If you're billing insurance at the full rate, then discounting the amount the insurance applied as patient responsibility, you are at least violating your contract. You could be doing worse if the insurance is a government payor.
2) See #1.
#1 is less likely to cause you problems as it is only your employees (unless someone is disgruntled) 🤬, but still not compliant. I have worked at small private practices where this was done (even if not compliant). Any larger healthcare system makes it very clear that you must pay your portion, even if you are treated where you work.
#2 the issue would specifically be like my #2 scenario in the original reply. Let's say your TOS rate is $100. Your full rate is $400. Insurance processes claim applying $200 toward $1000 deductible. If patient comes in weekly (and nowhere else), the insurance will be applying full $1000 to deductible, then will start paying their 80/20 or whatever percentage. However, you have no intention of collecting $1000 from the patient and will only be charging the patient $500. You are submitting false claims to the insurance.
Click to expand...
Thank you so much for you input. Do know of any courses, books or references that I could better familiarize myself with this stuff? It just seems like there are so many unknowns in the billing & coding world its hard to know what is right and/or wrong a lot of the times. I'd hate to have to consult an attorney every time we have a legal questions, ya know? I appreciate all your feedback with this it's helped a lot.
 
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Honestly, I've been doing billing/coding on a manager level for almost 20 years and don't know most of it. Some of the regulations are federal. Some are state. Most practices I've worked at, if there is not an attorney you currently deal with regularly, there was an attorney at some point to create or review policies.
The OIG link in my original reply is a good place to start. Your state's similar office is another.
 
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