Third-party billing companies generally do not consider this a mandatory requirement. This leads to a lot of credit accumulation which may sometimes result in negative growth. We at Virtual Healthcare take care of all such requirements. Our software is programmed to keep track of payments precisely. So this lowers the chances of accumulation of credit balance.
The credit balance is the extra money received by the health care institute. This may be due to multiple reasons. Sometimes, error in the billing process is the primary reason for extra payments. Some reasons for credit balance are:
Multiple payments received
This happens when the patient or the insurance provider performs the payment option more than once. The extra payments get accumulated in the health institute records.
Money received for a service that was not provided
In some instances, a patient is bound to receive a particular medicinal practice. But in specific cases, the therapy is not performed. This is, however, billed, and the patient makes the payment. This extra money is part of the credit balance of the health industry.
Errors occur sometimes due to mistakes made by the billing department. In some cases, these mistakes remain unnoticed.
The extra money received because of any of the above-mentioned reason contribute to the credit balance of the institute. This increases the liability of the institute. It is mandatory for the institutes to refund the extra money. This is not an option, however, there is a small threshold limit up to which the institutes can hold the extra money.
Credit Balance Resolution
Healthcare institutes that have high credit balances do not forecast good financial growth for the institute. The excess credit balance requires timely settlements. Serious violations leading to penalties arise when these refunds are not processed on time. The Credit Balance Resolution aims at keeping the credit balance of healthcare institutes as low as possible.
Loss Of Credibility
Trust takes a lot of time to build up. But it takes a moment to break down. For this reason, the credit balance plays a vital role. Money has a bitter history of creating bad relationships. It is the moral responsibility of the hospital to issue a refund at the earliest.
Methods To Enable Reconciliation
Initiating refunds is a complex process. Pre-check to find the reason for additional payments received. This would help in avoiding the situation from repeating. The process of reconciliation generally follows the 3-step rule.
Conforming the receipt of extra payment. This includes finding out the source of payment – insurance provider or patient.
Recheck if the billing process was correct. This includes checking for the treatment process and the other procedures. The bill should consist of the list of procedures done on the patient.
This includes proper documentation of any discrepancy found in the settlement. After proper documentation, it is properly sorted out. This includes refunds to the original payers.
Precautionary Steps For Avoiding Higher Credit Balance
The settlement of bills is in itself a complex process. Imagine the additional stress credit balance would add to your existing workload. For this reason, it is essential to perform a quick check of the current billing system to identify the loopholes. The following precautions can help you maintain the credit balance of the institute in check.
Avoiding Duplicate Payments
Ensuring that the patient and the insurance provider do not make payments for the same bill. In some cases, there are 2 insurance providers making settlements on the same account. This happens due to miscommunication between the different parties. Low transparency is another reason for this issue.
Processing Immediate Refunds
In the case of extra payments, verifications are mandatory. The refund should be processed as early as possible. Additionally, care should be taken that the refund should be processed only to the respective payer. The refund for the amount received from the insurance provider should not go to the patient and vice versa.
In special cases, the institute holds the credit balance. This is only allowed when there is a high possibility for the patient to come back to the same institute for further diagnosis.
The credit balance also affects the financial strength of the institute. Having a high credit holding does not mean that the institute is holding a lot of finance. The extra money is not the property of the hospital. There are chances when the patient or the insurance provider can sue the hospital. This may lead to an unwanted penalty.
However, the basic fundamental behind this credit balance is that we should not keep what does not belong to us. Returning it to the rightful owner is decent behavior. Making sure that the credit balance in medical billing is kept as low as possible helps in the positive financial growth of the institute.
Virtual Healthcare is an experienced company in the field of medical billing. Our team of professionals has the capability to fulfill any billing process. Contact us to improve your billing process and have positive growth in your financial record.