Question

Economic uncertainty and financial instability affect the ability of patients to pay debt arising from medical bills not covered by insurance, leading to questions of medical account resolution. Health care providers are on the opposite side of this equation because patient payments affect the revenue cycle, which can vary in length depending on the size and type of organization. In reality, some patients are unable to pay the portion of their medical bills not covered by insurance, adversely affecting the organization’s bottom line. Discuss the following in regard to this:

• What options and procedure would you consider acceptable for collection of bad debt?

Answer 1

As patients are forced to pay a bigger share of their medical bills, bad debt will remain a concern for providers—even as more Americans gain insurance coverage under healthcare reform.

A hospital incurs bad debt when it cannot obtain reimbursement for care provided; this happens when patients are unable to pay their bills.

Bad debt is any bill that is submitted for payment by patients which is not paid in full and doesn’t look to be paid off anytime soon, regardless of reason.

With billions of dollars at stake, providers have started to invest in new methods/tools for cutting bad debt. They are realizing the cost of these services are too extreme for patients to pay, so they are even starting to help counsel patients by assessing their financial situations and providing them with solutions to pay off the bills. Hospitals are starting to realize the old way of billing will not help anyone.

Yet hospitals give these patients care which incurs to more bad debt. The way to help reduce this debt would be to have a screening process for such individuals to see if they are able to qualify for some programs which may be able to help pay down this debt. This way they will be given the same quality of care, without either party incurring such a large debt.

# What options and procedure would you consider acceptable for the collection of bad debt?

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