There are several kinds of adjustments in The THERAPIST and they fall into two major categories, service adjustments and payment adjustments. This article describes adjustments to services. A separate article discusses payment adjustments.
Service adjustments fall into two types: predefined, built-in write-offs and undefined adjustments. The built-in write-offs include patient and responsible party discounts; insurance contract, risk pool, and tax loss write-offs; and a bad debt write-offs. These are the most common types of adjustments so The THERAPIST makes them available as individual fields on the money tab for each service. All but the bad debt write-off reside on the individual payer tabs.
All of the built-in write-off adjustments cause the service balance to be reduced and less money ultimately received. This makes sense; if you give a patient a discount, they will owe and you will receive less money.
The single most common adjustment is for money not paid because, for one reason or another, the insurance payer does not pay the full fee due. This is entered in the Contract Write-Off field for the payer in question. Contract write-offs are discussed more fully in an article titled Contract Write-Offs.
Risk Pool Write-Off
The Risk Pool Write-Off has a special purpose. Many payers have a special relationship with providers such as a preferred provider or HMO. The payer will send patients to the provider and, in order to control costs, requires the provider to share some of the risk of paying for treatment. This is done by withholding some portion of the amount the payer pays to the provider. At the end of the year, the payer reviews the provider's performance and the payer's profits and determines whether to pay the payer some, none, or all of the amounts withheld during the year. If you have these withheld from your payments, you can enter them in the appropriate Risk Pool Wirte-Off fields. This will help you track this cost of doing business with the payer.
Tax Loss Write-Offs
Tax Loss Write-Offs only apply to those locales that tax your services or the moneys paid you for your services. If you are required to collect the tax and the insurance payers do not pay it you have two choices. You can make the patient pay it or you can write it off and lose the money. For the latter, enter the amount of tax not collected in the payer's Tax Loss Write-Off field.
The undefined adjustments allow you to increase or decrease the service balance for any purpose not covered by one of the built-in write-offs. To make such an adjustment, go to the money tab for the service you wish to adjust. Press the Adjustments button on the lower left of the window. This opens a list of adjustments that have been added. Press the Insert button to add a new adjustment.
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