How to Handle Medical Write-Offs
Updated: Sep 29
How much unpaid medical debt does your medical practice or ambulance business have? What percent is likely to be categorized under medical write-offs? How are you reducing this? Recent studies suggest over 80% of independent practices are worried about whether their business would remain financially viable after the pandemic. Are you one of them? Take a deep dive at how much revenue is left on the table in your healthcare organization due to medical write-offs, and learn how you can handle medical write-offs before they happen in your medical facility.
What Exactly is a Write-Off?
A write-off is a medical bill balance that you have to forfeit collecting from patients (or other third parties!). Just as the name implies, you have to “write off” the bill from your accounts receivable. There are two major categories of write-offs: the necessary write-offs that have been approved and the unnecessary write-offs resulting from mistakes or lack of timely action.
Preventing Unnecessary Write-Offs
Write-offs often happen due to slow revenue cycle management, low claim submission, and increased billing or coding errors. These result in unnecessary medical write-offs like timely filing write-offs, uncredentialed filing write-offs, and bad debt write-offs. However, you can prevent these write-offs in the following ways outlined below.
Revamp Your Revenue Cycle Management Workflow Processes
Many health facilities are comfortable using conventional methods to manage their revenue cycle. We understand. It seems easier to do things as it has always been done especially as long as you see cash coming in. But, what about the cash you don't see but could be collecting? Some workflow processes (or lack of resources and time) make it difficult to manage your account receivables and track revenue losses. So, you end up with a massive amount to write-off. Review each step of your cycle and adjust for maximum impact. This helps improve collections and gets rid of delayed reimbursement.
Automate Your Billing Operations
This is an oldie but goodie with the majority of healthcare businesses already on the automation track. Nevertheless, how often are you checking for outdated modules or updating with custom edits based on your patient portfolio? Even automation requires a heavy hand with manual intervention.
Get Your Claims Approved Fast
See all those denied or rejected claims your team has to follow up on? They probably got sent back because of a billing and coding error, patient demographic or insurance mismatch or an insurance payment policy update. It takes dedicated effort to stay on top, figuring out precisely what went wrong. By the time you do (or your billing agent does), it’s too late, so the balance becomes a write-off to bad debt. We have found it often takes multiple calls and continual follow up to fully resolve an unpaid claim. By adding a step to identify trends to quickly identify loopholes and errors that cause repeat rejections and denials, you add prevention before claim submission.
It well now be the time to extend efforts to handle unpaid medical debt collection and prevent unnecessary write-offs. Partnering with a specialist in this area can improve your administrative staff's productivity by reducing their workload while maximizing outreach and collections.