On Sept. 24 of this year, the IRS closed the final comment period on the Proposed Rule for Section 501(r)—an outgrowth of the Affordable Care Act (ACA) that details new compliance criteria for tax-exempt hospitals and health systems.
These proposed regulations are far reaching to be sure, and include requirements pertaining to hospital Financial Assistance Policies (FAP), billing processes for patients qualifying for financial assistance, and patient debt collection practices. In particular, one of the most potentially disruptive (and ambiguously written) regulations would impose stringent limitations on collection practices in the emergency department (ED).
Major changes ahead for ED collections?
Though many hospitals have shown strong improvement in AR days across all performance categories, bad debt levels continue to be variable.
The Financial Leadership Council’s most recent survey revealed that, since 2008, hospitals have shown strong improvement in AR days across all performance categories. Average and bottom quartile programs, however, still have ample room to improve.
How does your bad debt stack up?