Better Patient Records Could Reduce Hospital Debt: Vendor

An analysis of bad debt write offs by 40 health care providers showed that almost 50 percent of the self-pay accounts could have been collected on, according to a study released today by a health care technology firm serving the providers.

The study by nTelagent Inc. showed that another 17 percent of the written off accounts could have qualified for government assistance or charity care programs.

Industry experts say bad debt write offs are the main reason for the financial deterioration of many hospitals. And the problem is growing as patients pay a larger percentage of their medical bills.  

Nashville, Tenn.-based nTelagent said it conducted the analysis with its own product, the Self-Pay Management System. The product is designed to help health care providers improve the handling and documentation of their self-pay accounts, said Laura Campbell, a company spokesperson.

NTelagent said it analyzed receivables between 90 and 180 days old from the period January, 2007 to January, 2008, from 40 healthcare providers nationwide. The providers were existing or prospective nTelagent clients.

Thirty percent of the accounts were written off as bad debt because patients’ incomes and net worth were not obtained or verified when they were pre-registered or when they were being serviced.  However, nTelagent found that more than 16 percent of those patients could be classified as having high household income and/or high net worth. Another 33 percent were classified as having moderate household income and/or moderate net worth.

NTelagent said those patient accounts could have been re-billed or outsourced for collections instead of being written off as bad debt.

“The report emphasizes the need for providers to implement an effective front-end accounts receivables solution,” Earl T. Winter, nTelagent’s chairman and chief executive, said in a press release.