Bad Debt and Collections Policy and Procedure - MNR and MMV - Billing and Collection Policy

Sep 16, 2026

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Billing and Collection Policy establishes how Montefiore Mount Vernon (MMV) and Montefiore New Rochelle (MNR) relieve accounts receivable classified as uncollectible. After reasonable follow-up efforts are exhausted, unpaid self-pay claims are evaluated against qualification criteria, including time since billing, communication attempts, payment-plan defaults, and eligibility checks. Procedure details include financial aid referral, payment arrangement plan rules, agency referral mechanics, dunning-level changes, recall handling, and requirements for bad debt documentation and approval at year-end.

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Billing and Collection Policy

Purpose and Scope

Definitions and References

Procedure

Financial Aid and Payment Arrangement Plans

Bad Debt Qualification Criteria

Agency Referral, Dunning Levels, and Recall Requests

SUBJECT: Billing and Collection Policy: Bad Debt Referrals Procedure OWNER: Revenue Cycle EFFECTIVE: 7/18 REVIEW/REVISED: 7/2023 SUPERSEDES: CROSS-REFERENCE: Financial Assistance Policy Self-pay follow up policy , Payment Plan Procedure PURPOSE: To relieve the Accounts Receivable (AR) of accounts deemed uncollectible by internal or external pre-collection processes. Montefiore Mount Vernon (MMV) and Montefiore New Rochelle (MNR) are committed to assuring that after exhausting all reasonable follow-up efforts; unpaid self-pay claims are referred to external agencies for further collection effort and the account classified as bad debt. REFERENCE: Unpaid Claim Follow Up, Patient/Guarantor Billing Policies, Termination of Follow up. SCOPE: MMV AND MNR associates responsible for collection of self-pay balances. This policy will apply to all MMV AND MNR departments , units, divisions and associates, inpatient, outpatient diagnostic and treatment centers. DEFINITION(S): Self-pay refers to accounts for patients with no insurance, patients with a balance after insurance payment or insurance denials where patient is made responsible for balance. PROCEDURE: Financial Aid- If the patient requests financial aid, they should be referred to the financial aid office in accordance with the financial aid policy Payment Arrangement Plan Criteria-Prior to an account being referred to bad debt it may be placed on a payment arrangement plan if the monthly payment amount requested and agreed to by the patient/patient representative falls within payment arrangement guidelines. Refer to payment plan policy. Payment arrangement requests made by the patient/patient representative which fall outside of the guidelines require review and approval by the manager. Bad Debt Qualification Criteria – An account may be referred to collection if it meets one or more of the following criteria: • Account is self-pay and has been billed and remains unpaid for over 120 days and all reasonable collection efforts have been exhausted (including but not limited to) : 1. Four (4) Self Pay statements have been sent. Statements are sent at 30-day intervals. A pre-collection/past due letter will be sent out in conjunction with the final statement. 2. A review of previous accounts is performed in the billing systems to determine if a valid third-party payer exists for date of service. 3. A name search is performed for Medicaid via eligibility portal(s) to determine if patient has Medicaid coverage. • Patient/Guarantor advises MMV or MNR associate that they have no intention of paying the bill. • Patient communication via mail and/or phone is unsuccessful due to incorrect information. An attempt will be made to obtain correct/updated address before account is referred. • Patient defaults on payment plans via Loan program. *Please note that bad debt adjustments require adequate system notes to demonstrate justification, reconciliation, and an audit trail before referring self-pay accounts to collection agencies. • Bad debt write offs are divided into two categories: Medicare Bad Debt and Bad Debt. In order to qualify for Medicare Bad debt, the balance due must bethe Part A Deductible, Coinsurance or Lifetime reserve days due from the patient. Medicare Bad Debt also refers to the 20% Part B patient responsibility for outpatient services. • International patient accounts returned by International Collection agency will be adjusted as bad debt once international agency closes out. • There are certain instances where at the discretion of MMV or MNR, an account will be adjusted as bad debt without going to an agency. For example: 1. John/Jane Doe accounts. 2. Prior accounts which have recently been returned as uncollectable. The year-end final bad debt report is reviewed and signed by the Senior Director of Patient Financial Services and the VP/CFO. Self-pay patients must always receive a bill prior to being referred to

FAQs

What is the purpose of the Billing and Collection Policy for bad debt referrals?

To relieve accounts receivable deemed uncollectible after exhausting reasonable follow-up efforts and refer unpaid self-pay claims to external agencies for further collection, classifying them as bad debt.

Under what conditions may an account be referred to collection as bad debt?

An account may be referred if it is self-pay and unpaid for over 120 days after reasonable collection efforts (including multiple statements and pre-collection letters) are exhausted, if the patient states no intent to pay, if communication is unsuccessful after attempts to obtain correct address, or if the patient defaults on payment plans.

How are self-pay accounts handled before referral to a collection agency?

Self-pay patients must always receive a bill prior to referral unless there is a bad address on file; all efforts must be exhausted to locate a correct address.

Sep 16, 2026

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