3rd Party Settlements

Although the request sent by 3rd parties on behalf of the insurance looks like a great deal, it usually is NOT! (hardly ever…. Never) When you settle, you are agreeing to a discount off of the billed charge amount. But that is not what will be paid. From the amount they state they will pay, any patient responsibility will be deducted, and then a check will be cut. In addition, signing those agreements can also bind you to ‘in-network” processing meaning the amount collected from your patient prior to claim processing may be inappropriate.
MY Suggestion:
• Request that the “ allowed amount’ is 80% of the billed charge so patient responsibility can be taken from that amount.
• Request that they provide you the EXACT amount of your payout
In the event they cannot do either of the 2, request that the claim be sent back to the plan for processing.
Without knowing the exact payout it is difficult to know how the claim will process and pay so there certainly is a risk to declining the offer so please take into consideration my advice from my experience but please always do what you feel is best for your practice.
Example of how it is processed:
They take billed charge $5,000.00
Take discount 20%: $1,000.00 = $4,000.00 (allowed amount)
Take patient responsibility Deductible / Coinsurance: $3,000.00 = $1,000.00
Then pay the provider $1,000.00

Bad Debt Protocol

In the event you are unable to offer or have your clients complete a hardship form, utilizing a Bad Debt protocol will keep you within legal limits.

Bad Debt Sample
Bad Debt Collection Form
The below account has been reviewed for bad debt, and has been determined that this balance is non collectible for the following reason:

1. Patient is low income and has NOT completed the hardship form
2. Patient has been sent 3 consecutive statements and has not responded
a. 1st Statement Date
b. 2nd Statement Date
c. 3rd Statement Date
3. Patient abruptly discontinued care and the balance has been adjusted as professional courtesy
4. Patient balance has been transferred to below listed foundation for charitable review
a. Foundation Name
b. Review Date is Applicable
5. Patient has been offered a settlement amount due to delinquent payment.
a. Patient balance amount adjusted off for settlement
b. Patient balance amount due based on settlement offer
6. Other

Patient Name:_________________________
Guarantor Name:____________________
Address:__________________________________________ __________________
Telephone:____________________________
Health Insurance: ________________
Patient Date of Birth:______________________
Amount Collected:
Deductible: Coinsurance:
Balance Due:

Approved By
Approved Date

Do’s and Dont’s on waiving patient responsibility

https://www.webpt.com/blog/post/legal-compliance-one-more-reason-to-collect-patient-deductibles-and-copays

Sample Hardship Form
In compliance with insurance billing and collection, my practice is responsible to collect at minimum your plan benefit deductible and coinsurance.
As my practice is currently not contracted or in-network with some/most insurance plans we have decided NOT to “ out of network penalty”, balance bill our clients outside of the appointed patient deductible and coinsurance responsibility.
The agreed contract payment plan may be an estimate based on the benefit verification you received or our practice cash fee in lieu of the estimated benefit verification.
The hardship application can be offered under one of the two scenarios listed below:
1. Once we have verified the estimated upfront cost for care and you have expressed that this amount may cause a financial hardship for yourself/family.
2. Once your care is complete, and all claims has been processed by your insurance provider.
Patient Name:_________________________
Guarantor Name:____________________
Address:__________________________________________ __________________
Telephone:____________________________
Health Insurance: ________________
Patient Date of Birth:______________________
Amount Collected:
Deductible: Coinsurance:
Balance Due:
Gross Monthly Income:
Monthly Household Expenses:

Mortgage/Rent: Medical Utilities: Car Payment:

Food: Other Total OUT:

Number of Dependents in Household (Including self): ________________

Patient or Guarantor Signature:_________________________________ Date:________
Final approval will require a copy of your most recent income tax form accompanied by supporting W-2/ 1099/ SSA 1099 statements. If you do not file a tax return or if you have had significant financial changes, please explain on the reverse side of this form. Please return this form and all attachments to the attention of the Practice Manager at the address listed on this form. We appreciate the opportunity to work with you to resolve this outstanding balance.

tomorrow is National Midwives Day!!!!

Stating I have been “BLESSED” to serve Midwives would be a gross understatement. Myself and the entire Favored Medical Billing staff, LOVE and APPRECIATE You!!!!!

“When a woman births, not only is a baby being born but so is a mother.
How we treat her will affect how she feels about herself as a mother
and as a parent.
Be gentle. Be kind. Listen.”
― Ruth Ehrhardt, The Basic Needs of a Woman in Labour