Credit - Refund Policy
Larkin Community Hospital
Purpose is to establish the minimum performance standards as they apply to the preparation and processing of refunds due Larkin Community Hospital patients, guarantors, and/or third party insurance carriers.
Larkin Community Hospital shall process all refunds within a reasonable time of the generation of a credit balance.
Larkin Community Hospital shall refund credit balances to patients or guarantors only after application of such credit balance to any open A/R or bad debt account of the patient or guarantor.
Larkin Community Hospital shall follow Coordination of Benefits (C.O.B.) priority in calculation of correct payee(s) on credit balance accounts.
Refunds shall be made to insurance companies, patients or guarantors in inverse C.O.B. priority order.
Larkin Community Hospital shall not refund any credit balance to a patient or guarantor that should be paid to an insurance company.
Larkin Community Hospital shall audit all credit balance accounts to ensure that misapplied payments, erroneous adjustments, etc. do not cause incorrect refunds.
Larkin Community Hospital shall process an immediate patient refund on a credit balance account in cases of documented hardship and/or hospital error.
Larkin Community Hospital shall maintain adequate control over refund requests, including the following:
- A) All refund requests shall require adequate documentation.
- B) All refund requests shall require prior management approval before being forwarded to accounts payable
- C) All refunds processed shall be logged by clerks
The refund clerk and/or hospital designated employee shall review credit balance reports on a bi-monthly basis.
Credit balances shall also be resolved by collectors in the process of working their accounts for follow up.
Larkin Community Hospital shall transfer credit balances due to misapplied payments to the appropriate patient account.
To process a refund the collector or refund clerk must follow these steps:
- 1. Complete a “Patient Refund Request Sheet” form.
- 2. Attach proper documentation that includes:
- A) Patient account detail transaction.
- B) Copy of payment documentation (checks, cash receipt etc.)
- 3. Obtain approval from immediate supervisor.
- 4. Obtain approval from Director of Business Office.
- 5. Obtain approval from Revenue Cycle Director and CFO.
- 6. Send package to Accounts Payable for check processing.
- 7. Verify that transaction has been posted to patient account.