Q&A | Benchmarking and Forecasting

Ask the Experts: Up-Front Reserves

Q&A | Benchmarking and Forecasting

Ask the Experts: Up-Front Reserves

What is the industrywide uncollectable percentage for accounts receivable that hospitals can set aside as up-front reserves?

What is the industrywide uncollectable percentage for accounts receivable that hospitals can set aside as up-front reserves? In my past experience, it has been 3-5 percent.

Answer: The best way to calculate your up-front reserve is to look at your own collection experience. HFMA has MAP App data on bad debt write-offs for high-performing hospitals, but to be realistic and fit with your hospital’s payer and service mix, use your own experience.

This question was answered byRuth Landé, vice president, patient revenues, Memorial Sloan-Kettering Cancer Center, and is a member of HFMA’s Metropolitan New York Chapter.

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