Write-offs, adjustments, and reconciliation

write offs, adjustments, and reconciliation are key steps in keeping your billing records accurate this article explains what each term means, when to use them, and how they fit into the revenue cycle in eggmed u nderstanding adjustments an adjustment is any change made to a charge after it has been created adjustments are commonly applied during payment posting typical adjustments include contractual adjustments from insurance payers reductions based on allowed amounts corrections to billed or paid amounts adjustments help align the original charge with what the payer actually allows or pays w hat is a write off a write off is an amount you decide not to collect write offs are usually applied when the payer disallows part of a charge a balance is deemed uncollectible you choose to forgive a remaining balance write offs reduce the outstanding balance but do not represent a payment i nsurance adjustments vs write offs insurance adjustment applied when the payer contractually reduces the allowed amount write off applied when the practice chooses not to pursue the remaining balance both affect balances differently and should be used intentionally w hen adjustments and write offs are applied adjustments and write offs are typically applied when posting insurance payments reviewing remittances (era/eob) resolving underpayments or discrepancies they are entered at the charge item level to ensure accurate tracking w hat reconciliation means reconciliation is the process of verifying that charges payments adjustments write offs all align correctly and balances make sense reconciliation helps ensure that payments are fully allocated no balances are overstated or missing reports reflect true financial activity c ommon reconciliation scenarios you may need to reconcile when balances don’t match remittance totals unapplied payments exist reported totals differ from expected revenue insurance paid less than anticipated in these cases, reviewing adjustments and write offs is essential b est practices apply adjustments based on payer remittance details use write offs only when collection is not expected reconcile regularly to catch issues early review aging and billing reports as part of reconciliation