Case Management

CMW News: One-third of patient bad debt should be classified as charity

Case Management Weekly, April 1, 2009

A study of 148 hospitals in 2008 has identified that nearly 31% of patient revenue written off as bad debt should actually be classified as charity care, according to Healthcare Finance News.

The study was conducted by Connance, Inc., a company that offers hospitals Web-based billing solutions and Paro Decision Support, LLC, a healthcare analytics firm.

Patients who live in poverty sometimes choose not to apply for charity care because they are unable to understand the documentation or the process. The article argues that hospitals should work to identify more patients who are eligible for charity care, which will save in operation costs as hospitals will not be putting resources into collecting the bad debt.

Source: Healthcare Finance News

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