Risk Management FAQs

(According to your professional liability insurance policy with OUM, all claims must be reported to OUM as soon as practical. 
Failure to do so puts you at risk for being denied insurance coverage should that claim or incident result in a lawsuit. OUM also 
encourages the reporting of incidents that you believe may develop into a claim in the future. A patient’s request for a waiver of 
an outstanding balance falls within the definition of a claim. Should you receive a request from a patient for a bill write-off or if 
you are considering writing-off a patient’s bill, you are encouraged to contact OUM’s Claims Department for guidance. You will 
be advised if any additional action needs to be taken and if additional information and/or documents will be needed. See the 
section on “What Should I Report To OUM?” in the Claim/Incident Reporting section below.)
In instances of clear or questionable medical error or in instances where the patient is extremely dissatisfied with 
the care that was rendered, the act of writing off the patient’s bill may be seen as an act of good will and may avoid a 
lawsuit. However, there are no guarantees. To reduce the appearance of admitting liability following an adverse event 
or unexpected outcome, communicate with the patient and document that the bill is being written off as a gesture of 
goodwill.
In instances where the patient is unhappy over collection attempts of a bill and is demanding a write-off, you must 
decide whether or not you want to continue to pursue collections. Your decision may be based upon the amount of the 
bill and how much “hassle” you are willing to undergo and how you feel the patient will react to your decision, etc. If 
you feel the care and treatment you provided and the charges for the care rendered was appropriate, you have several 
options, including:
• Denying the patient’s request to write off the bill, and continue pursuing collections.
• Discontinuing pursuing collection attempts, but keeping the balance due on the records.
• Agreeing to write off the bill.
If you deny the request, send the patient a letter stating you have reviewed the care and treatment rendered and the 
charges, found it to be in order and are respectfully denying his/her request to write off the bill. If you decide to write 
off the bill, send the patient a letter stating you are writing the bill off as a goodwill gesture.
You should be aware of federal anti-fraud, abuse and anti-kickback laws and consult your personal counsel regarding 
the application of these laws. Write-offs for risk management purposes should be considered on an individual basis 
and not offered routinely. If you decide to write off a patient’s bill, it is generally best to write off the entire bill, not 
just the co-payment or deductible. For Medicare, if the claim has already been billed, the provider may not write off a 
bill without triggering reporting obligations. If the claim has not been billed, the provider may forgive a bill and not bill 
Medicare without triggering reporting obligations

Medicare rules state that routine write-offs of co-pays and deductibles constitute billing fraud and abuse. Private 
insurers often have similar rules. Thus, practitioners should carefully avoid routine write-offs. If, however, the patient 
has a legitimate financial hardship, Medicare (and most private insurances) will allow a write-off to occur. To protect 
themselves, practitioners should get documentation from the patient explaining the financial hardship in as much 
detail as possible. At a minimum, the patient should be asked to send a letter; if possible, tax returns, bankruptcy and 
foreclosure papers could also be helpful documentation.

Each office practice should have a written policy regarding billing and collection procedures, and patients should be 
informed of the office’s billing practices prior to the initiation of treatment. For example: What insurance plans do you 
accept? What is the patient’s responsibility regarding co-pays, out of pocket expenses, etc.? Do you take credit cards? 
When is payment expected?
Hold communications with patients regarding billing matters in a private location. Make sure the person(s) handling 
billing issues in your office is courteous and has the ability to help patients understand their bills. Try to determine the 
reason for non-payment. Is the patient unhappy with the treatment provided? If so, see “Should I write off a patient’s 
bill?” above. Is the patient having financial difficulties? If so, try to work out a payment schedule. Prior to turning over 
a patient to a collection agency, send the patient 30, 60 and 90 day billing notices. Recognize any patient attempts to 
make payments.
DO NOT allow your staff to turn over a patient to a collection agency until you have had a chance to review the 
patient’s records and weigh the risk of malpractice litigation against the need to collect. OUM’s Risk Management 
Department may be consulted for guidance.
If you choose to utilize a collection agency, make sure the staff is courteous, tactful and professional since the 
collection agency could be viewed by the patient as a part of your office. You should approve any forms and/or letters 
used by the agency, and you should give written approval before the collections agency files a lawsuit against a current 
or former patient. Collection procedures should treat all patients consistently. Collection efforts should NOT be 
recorded in the patient’s record.