Health Information Management

Refine the terms: Understand unbilled accounts and DNFB

HIM-HIPAA Insider, March 27, 2007

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Chief financial officers (CFOs) seek to achieve timely billing and collection of payments for claims. One of the major prerequisites for achieving this goal is accurate and timely coding. Organizations strive for 55 or fewer days for bills to be in net accounts receivable. What are accounts receivable? What does discharged not final billed (DNFB) mean? How do these two terms tie with "unbilled" accounts? Read on for some quick explanations:

Unbilled: Throughout the patient's stay, charges accumulate on the patient's account. During this period, the charges are "unbilled." Healthcare facilities often establish a period after the patient's discharge during which charge-generating departments complete the posting of charges to the patient's account. This period is known as the "suspense" or "hold" period--the period that billing is held, to collect all charges. The sum of the inhouse charges held during this holding period represents the "unbilled" accounts. However, once all the charges are posted, the claim is not immediately "dropped" and processed. You must first code the record.

DNFB: Most facilities code records after patients have been discharged. However, exceptions may occur when an organization has a concurrent-coding program or for long-stay patients, during which interim billing and, therefore, interim coding may occur. Those accounts that are not yet billed at the time of discharge are listed on the DNFB list. This listing will include patient accounts categorized as suspended or discharged but unbilled. Accounts may be unbilled for a variety of reasons, such as the following:

  • They require coding and the coding has not been completed
  • They are coded but lack a code to correspond to a charge--often  identified during the initial claim-editing process
  • They have been coded but still await charges, which will be entered within the "suspense" period
  • They are coded but were rejected during the claim-editing process because of an unrelated HIM element, such as an invalid revenue code, a missing data element, or an inaccurate payer designator
  • Accounts receivable: Accounts that have been billed but not yet paid are classified as "receivable," that is, the organization is waiting to receive payment. An organization cannot have "accounts receivable" until the claim clears the edits and is transmitted to the payer. Some organizations, at the time of billing the payer, calculate and deduct the amount they do not expect to be paid. If this process is done at billing, the receivables are considered "net" or "net account receivables."

    For managed-care payers and governmental payers such as Medicare, the organization knows how much money it will receive for the case because the managed-care contract often is based on a case rate, per diem charge, or percent of charges. Similarly, Medicare payments, for the most part, are based on diagnosis-related groups or ambulatory payment classifications and not charges. Deducting this "contractual" amount at the time of billing eliminates efforts at the time of remittance to reduce the balance remaining on the account by this contractual amount. Automating the process eliminates human error.

    Editor's note: The above article was adapted from the new book Coder Productivity: Tapping your Team's Talents to Improve Quality and Reduce Accounts Receivable. For more information or to order, call 877/727-1728 or go to click here.

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