Wiki Small Balance Write off, collections, and bad debt

micki127

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Hi,

What is the typical small balance write off amount? What is the lowest amount you would consider sending to collections and/or just write off as bad debt?

Thank you in advance for your input!
Micki
 
Uhm..

Isn't this more of a case by case basis? Some adjust for $5.00. Some adjust for $25.00. Some send to collections for general purpose etc.

What is your provider's preferred guidelines for this?
 
Yes, this is a case by case basis but I was looking for a general rule of thumb or an average that other practices were doing. As of right now there is nothing in place and I was thinking on the lines that nothing less than $25.00 should go to collections and anything less than $25.00 would go to bad debt. Everything under $2.50 would be a small balance adjustment.
 
We are a Family Practice/Specialty provider office so we are set a little differently.

- Small balance is anything $4.99 and under
- Commonly for physician offices the collection threshold is $19.99 as co-pay are generally $20.00 and you would not want to write off co-pays that were not collected at the time of service.

Generally each office sets their guidelines based on common co-pay amounts and they weigh in the cost of assigning accounts to collections and the cost of going after a certain balance amount. So it comes down to cost of collections vs. the amount being collected.
 
Thank you for your input and you are so correct in what you stated. Definitely do not want to write off co-pays :)

Have a wonderful day!
 
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