PATIENT CREDIT BALANCES
What is a Patient Credit?
A patient credit balance is when the practice owes money to a patient and every practice will have some number of patients with a credit balance on their account.
Patient credit balances arise when:
- the patient has paid for treatment in advance (a deposit).
- the patient has paid their portion, but later the patient’s insurance pays more than expected, and now patient is due a refund.
- an employee made a mistake (human error)
- a dishonest employee applied phantom patient credits to hide theft.
Most patients with a bona fide credit balance will “use up their credit” on subsequent visits, so over time everything works out.
However when patients with credit balances do not return to the practice, and practice efforts to track those patients down are unsuccessful, then over those credits keep building up in the dental software.
It’s the patient’s money
When a patient with a credit balance on their account cannot be located, it’s still their money.
Depending on where you live, after 3 to 5 five years of dormancy you must turn the patient’s unclaimed money over to the state.
The State Treasury is then responsible to keep that money safeguarded for up to 99 years in case the rightful owner or beneficiary of the money comes forward to claim it.
See a Typo or an Error? Report it.
UNCLAIMED PROPERTY guidelines for each state
Each state has its own guidelines for reporting unclaimed money. (see table below)
For example, in Alabama, when a patient has a credit of $50 or more on their account and 3 years have passed, then the practice must report the account and remit $50 to the Alabama State Treasury Unclaimed Property Division.
Years = The number of years required before a dental practice must report unclaimed property. (i.e: patient credits)
Min. Amt. = The minimum dollar value of the unclaimed property
Visit your state website for more information.
Canadian practice owners, visit Blakes for links to the unclaimed property divisions in each province: https://www.blakes.com/insights/canadian-primer-on-unclaimed-property-legislation
If you have questions, or need help in implementing any of the suggestions in this article, contact me for assistance.
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If you see an error or spot a typo, please let me know.
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