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Reimbursement For Medicare
Bad Debts
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Since the
inception of the Medicare program, few reimbursement or cost
reporting issues have been as debated or as meaningful as the
allowability of bad debts. The topic is at least as relevant today as
in the past, due largely to the fact that Medicare bad debts remain
cost reimbursed while most other items of cost are not.
First the basics. For a claimed bad debt to be deemed allowable,
applicable regulations require that:
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The bad debt must be for deductibles and/or
coinsurance relating to Medicare covered services.
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The provider must be able to show that it made
reasonable collection efforts.
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The debt must be actually uncollectible when claimed
as worthless.
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Sound business judgment must establish that there is
no likelihood of recovery.
While
seemingly straightforward, these basic requirements are deceptively
complex. They have often been the subject of clouded interpretations,
mixed rulings by boards and courts, and shifting documentary
requirements of fiscal intermediaries. A provider should expect to
navigate an often cumbersome path to a successful claim for Medicare
bad debt reimbursement. Issues likely to be pointedly reviewed or
contested by fiscal intermediaries include strict patient-by-patient
documentation requirements, the comparative reasonableness of
collection efforts, claims for bad debts relating to indigent patients,
and the timing, rigor, and duration of collection efforts.
SRG
has considerable experience assisting hospitals to navigate these and
other issues surrounding Medicare bad debts. Our experience with a
range of fiscal intermediaries provides us with valuable insight into
the often unique requirements of each. At your request, SRG stands
ready and able to assist your institution with perfecting your
legitimate and fully documented claim for Medicare bad debt
reimbursement.
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