The credit balance shows the quantity of extra money in possession of the healthcare institute. There can be both methods for a high credit balance – positive and negative. In a healthcare institute, the credit balance refers to the excess money in possession of the institute. This is because the payments are mostly collected after the completion of the process. The reason for having a higher credit balance in medical billing is because of duplicate or repetitive payments.
At Virtual Healthcare, we provide the best billing services. With an experience of more than a decade, we make sure the record books are complaint friendly. For this, we keep a track of the credit balance and issue a refund immediately. The team aims to keep the record books of the institute healthy.
RISKS OF HIGH CREDIT BALANCE
Having a high credit balance is against regulations. This is almost similar to holding money excessively and illegally. Whenever any patient makes excess payment, it adds up to the credit balance. It is essential to return this extra money to the source at the earliest. The various risks related to credit balance are:
- Compliances – There are regulations regarding credit balances. There is also a maximum time up to which the institute can hold the credit balance. Holding a credit balance beyond this time frame may lead to legal issues.
- Misinterpretation of records – The financial situation of the institute is not understood properly. This is because of the excess amount of money in possession of the institute, even though it does not belong to the institute.
- Overburden on staff – Taking care of not only the old credits but also the incoming ones puts enormous pressure on the staff. This leads to overburdening on the staff leading to more mistakes,
- Wrong assumptions – This is because of the assumption that credit balances are “profit centers”. This leads to miscalculations in plans.
- Loss in revenue – The excess credit is sometimes misinterpreted as receiving a new payment. This gets posted sometimes, leading to loss of self-pay co-payments or deductibles.
- An attempt of internal fraud – This happens when the credit balance mounts up, and the management is not aware of the sources. Tee staff or other people related to billing and accounts try malpractices.
- Negative moral impact – When the company does not refund the excess credits, the patients face harassment. The trust level of the institution falls drastically.
HOW TO AVOID ACCUMULATION OF CREDIT BALANCE
Although the credit balance does not create an immediate problem, the accumulation of such credits over a period of time may lead to serious issues. It is always better to return the excess payment as early as possible. This will not only keep the balance low but also lower unwanted stress on the staff. There are multiple ways over-payments can occur so the refund should also match the original payment method.
Over-payment from the patient –
Excess payment from patients is a common problem. There can be multiple reasons, with the most common reason being carelessness during payment. Verify the payment to be sure that it is essentially an excess credit. Initiating the refund process only after the verification process. Issuing a proper explanation along with a check for the excess amount for the patient. In the case of card payments, the refund happens directly to the payment source.
Over-payment from an insurance provider –
There are cases when the insurance provider makes an excess payment. The refund process in such a scenario requires additional verification. This is in comparison to over-payments from patients. The first step is to inform the insurance provider about the excess payment received. Wait for them to formally send the rectified claim form again. Make sure that the insurance provider also gives a proper explanation for the excess payment.
Preserve a copy of the refund process for future reference in case of any requirements. The processing of refunds to credit cards requires additional care. There are chances of anti-social elements trying to take advantage of these excess funds.
Not all excess payments add to the credit balance. There are some situations when the patient will be visiting the hospital again. In such a situation there is no point in refunding the excess payment. Adjustments to the next bill will rectify the extra payment.
Keeping the credit balance in medical billing within the acceptable range requires a tough grind. This is where the experience of Virtual Healthcare comes to your rescue. Experienced professionals taking care of your billing process. This makes sure that your balances are never a problem.