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Administrative (Non-Clinical) Policy
This administrative policy applies to the operations and staff of the University of Wisconsin Hospitals and
Clinics Authority (UWHCA) as integrated effective July 1, 2015, including the legacy operations and
staff of University of Wisconsin Hospital and Clinics (UWHC) and University of Wisconsin Medical
Policy Title: Patient Billing and Collections Policy
Policy Number: 2.33
Effective Date: July 1, 2016
Chapter: Fiscal Affairs
UW Health recognizes the cost of necessary health care services can impose a financial burden on
patients who are uninsured or underinsured. UW Health also recognizes the billing and collection process
is complex and has implemented procedures to make the process more understandable for patients. The
goal of this policy is to provide clear and consistent guidelines for conducting billing and collections
functions in a manner that promotes patient satisfaction, operational efficiency and compliance with law.
Through the use of billing statements, written correspondence, and phone calls, UW Health will make
diligent efforts to inform patients of their financial responsibilities and available financial assistance
options. Additionally, UW Health will make reasonable efforts to determine a patient’s eligibility for
financial assistance under our Financial Assistance Policy before engaging in extraordinary collection
actions to obtain payment.
A. Bad Debt Accounts: Accounts that have been determined to be uncollectible because the patient
has been unwilling to pay for their medical care.
B. Community Care: UW Health’s internal name for its Financial Assistance Program. The
Community Care program is not a form of health insurance and cannot be used to subsidize
C. Emergency Care: Immediate care provided by a hospital facility for emergency medical
conditions that is necessary to prevent putting a patient’s health in serious jeopardy, serious
impairment to bodily functions, and/or serious dysfunction of any organs or body parts.
Emergency Care is deemed to be medically necessary.
D. Extraordinary Collection Actions (ECAs): A list of collection activities, as defined by the
United States Internal Revenue Service (IRS), that healthcare organizations may only take against
an individual to obtain payment for care after reasonable efforts have been made to determine
whether the individual is eligible for financial assistance. These actions are further described in
Section IV of this policy and include actions such as reporting adverse information to credit
bureaus/reporting agencies along with legal/judicial actions such as garnishing wages. For
purposes of clarity, the following actions are not ECAs:
1. Any lien that UW Health is entitled to assert under state law on the proceeds of a
judgment, settlement, or compromise owed to a patient (or his or her representative) as a
result of personal injuries for which UW Health provided care.
2. The filing of a claim by UW Health in any bankruptcy proceeding.
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E. Financial Assistance Policy (FAP): UW Health’s administrative policy that describes UW
Health’s financial assistance program and meets the requirements of 26 C.F.R. § 1.501(r)
including the criteria patients must meet in order to be eligible for financial assistance as well as
the process by which individuals may apply for financial assistance.
F. Federal Poverty Guidelines (FPG): A federal poverty measure issued each year in the Federal
Register by the Department of Health and Human Services (HHS). These guidelines are a
simplification of the poverty thresholds used for administrative purposes in determining financial
eligibility for UW Health’s Financial Assistance Program as well as certain federal and state
G. Gross Charges: The full, established price for medical care that UW Health consistently and
uniformly charges patients before applying any discounts, contractual allowances, or deductions.
H. Medically Necessary: Those services required to identify or treat an illness or injury that is either
diagnosed or reasonably suspected to be necessary, taking into account the most appropriate level
1. Depending on a patient’s medical condition, the most appropriate setting for the
provision of care may be a home, a physician’s office, an outpatient facility, or a long-
term care, rehabilitation or hospital bed. In order to be medically necessary, a service
a. Be required to treat an illness or injury;
b. Be consistent with the diagnosis and treatment of the patient’s conditions;
c. Be in accordance with the standards of good medical practice; and
d. Be that level of care most appropriate for the patient as determined by the
patient’s medical condition and not the patient’s financial or family situation.
2. The term “medically necessary” does not include services provided for the convenience
of the patient or the patient’s physician, or elective health care. For purposes of this
policy, UW Health reserves the right to determine, on a case-by-case basis, whether the
care and services meet the definition and standard of “medically necessary” for the
purpose of eligibility for financial assistance.
I. Patient: For purposes of this policy, patient can be defined as person responsible for the payment
of the bills which sometimes will be the guarantor of the account.
J. Reasonable Efforts: The actions UW Health takes to determine whether a patient is eligible for
financial assistance under UW Health’s financial assistance policy before engaging in
extraordinary collection actions. Reasonable efforts may include making presumptive
determinations of eligibility for full or partial assistance, as well as providing individuals with
written and oral notifications about the FAP and application processes, consistent with this
K. Third Party Payers - Any party issuing payment on behalf of a patient to include but not limited
to: insurance companies, Workers’ Compensation, governmental plans such as Medicare and
Medicaid, State/Federal Agency plans, Victim’s Assistance, etc., or third-party liability resulting
from automobile or other accidents.
L. Underinsured: Insured patients whose out-of-pocket medical costs exceed their ability to pay.
M. Uninsured: Patients with no insurance or third-party assistance to help resolve their financial
liability to healthcare providers for a particular service.
N. UW Health: UW Health is comprised of three separate entities: the University of Wisconsin
Hospitals and Clinics Authority, the University of Wisconsin Medical Foundation, Inc., and the
University of Wisconsin School of Medicine and Public Health. Each of these three entities is
responsible for enforcement of this policy with its employees and agents.
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III. POLICY ELEMENTS
This policy describes the billing, payment and collection processes applicable to services provided to UW
Health patients. After patients have received services, it is the goal of UW Health to bill patients and
applicable payers accurately and in a timely manner. During this billing and collections process, UW
Health staff and its agents will provide quality customer service and timely follow-up. Consistent with
these commitments, UW Health acts in accordance with this billing and collection policy to comply with
(a) the Centers for Medicare & Medicaid Services Medicare Bad Debt Requirements (42 CFR § 413.89),
(b) the Medicare Provider Reimbursement Manual (Part I, Chapter 3), (c) the Internal Revenue Code
Section 501 (r), and (d) other applicable law. From time to time UW Health may make exceptions to this
policy as deemed appropriate by the UW Health Vice President of Revenue Cycle (in consultation with
the UW Health Chief Financial Officer).
A. Patient Billing Practices
1. All patients will be billed for self-pay balances and will receive a statement as part of the
organization’s normal billing process. Patients may request an itemized statement for
their accounts at any time.
2. UW Health will identify patients eligible for its Financial Assistance Policy, and will bill
them at a discounted rate.
3. For insured patients, UW Health will bill applicable third-party payers based on
information provided by or verified by the patient. Insured patients will be billed for their
respective liability amounts as determined by the third-party payer and/or UW Health.
4. UW Health may approve payment arrangements for patients who indicate they may have
difficulty paying their balance in a single installment. UW Health is not required to
accept patient-initiated payment arrangements and may refer accounts to a collection
agency as outlined below if the patient is unwilling to make acceptable payments or has
defaulted on an established payment plan.
5. UW Health may provide any written notice or communication described in this policy
electronically to any patient who indicates he or she prefers to receive the written notice
or communication that way.
B. Collections Practices
1. UW Health will provide reasonable options for patients who are making a good faith
effort to pay their bills. However, UW Health expects patients to pay the amounts due for
health care services provided, and will pursue collections when necessary. In compliance
with relevant state and federal laws, and in accordance with the provisions outlined in
this policy, UW Health may engage in collection activities—including ECAs—to collect
outstanding patient balances. UW Health may:
a. Initiate general collection activities, such as statements, letters and/or follow-up
b. Refer patient balances to a third party for collection at the discretion of UW
Health. UW Health will maintain ownership of any debt referred to debt
collection agencies. Patient accounts will be referred for collection under the
i. There is a reasonable basis to believe the patient owes the debt.
ii. Known third-party payers have been properly billed, and the remaining
debt is the financial responsibility of the patient.
2. UW Health will not:
a. Refer a balance for collection while a claim on the account is still pending payer
payment. However, UW Health may classify certain claims as “denied” if such
claims are stuck in “pending” mode for an unreasonable length of time despite
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efforts to facilitate resolution.
b. Knowingly refer accounts for collection due to a UW Health error.
c. Refer accounts for collection when the patient has a pending application for
financial assistance or other UW Health-sponsored program provided the patient
has complied with the timeline and information requests described in the
3. Payment is expected at time of service for any applicable co-pay, and possible co-
insurance, and/or deductible. UW Health accepts cash, checks, and credit or debit cards
as forms of payment. Payment in full of the account balance is due 21 days after
receiving the first bill. Payment plans may be arranged if a patient cannot pay in full.
Arrangements longer than 6 months may require submission of a Financial Assistance
application for consideration. If a patient check is returned to UW Health for insufficient
funds, a returned check fee will be applied to the outstanding balance.
4. UW Health will not engage in ECAs against a patient to obtain payment for care until
making reasonable efforts to make the patient aware of the availability of financial
assistance and the process for applying for financial assistance. Once reasonable efforts
have been exhausted, ECAs taken by UW Health or a third party agency against a patient
related to obtaining payment of a bill for care covered under UW Health’s FAP may
a. Reporting unpaid accounts to consumer credit reporting agencies or credit
b. Actions that require a legal or judicial process, including but not limited to:
i. Filing judicial or legal action;
ii. Commencing a civil action against a patient;
iii. Garnishing of wages; and
iv. Obtaining judgment liens and executing upon such judgement liens using
lawful means of collection.
5. UW Health may begin ECAs at least 120 days after providing the first post-discharge
statement to a patient. In addition, UW Health shall do the following at least 30 days
before initiating ECAs:
a. Provide the patient with a written notice (ECA Notice) indicating the availability
of financial assistance, listing potential ECAs that may be taken to obtain
payment for care, and giving a deadline after which ECAs may be initiated.
b. Provide a plain-language summary of the FAP to the patient.
c. Attempt to notify the patient orally about the FAP and how he or she may obtain
assistance with the application process.
6. If a patient’s eligibility for financial assistance is undetermined, then UW Health will
refrain from initiating ECAs for at least 120 days from the date of the patient’s first post
discharge billing statement, and no earlier than the deadline provided to the patient in the
ECA Notice. In addition:
a. If a patient submits a complete financial assistance application at any time within
the FAP application period, then UW Health or its debt collection agency must
suspend any ECAs, determine the patient’s eligibility for financial assistance, and
notify the patient whether financial assistance is available.
i. If the patient is eligible for financial assistance but not eligible for free
care, then UW Health must provide the patient with a statement
indicating the amount that the patient owes.
ii. If the patient is eligible for financial assistance, UW Health will reverse
any previously taken ECAs, and refund any amount he or she has paid
for care within the past 6 months (whether to UW Health or any other
party to whom UW Health has referred the individual’s debt) that
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exceeds the amount he or she is determined to be personally responsible
for paying as a FAP eligible individual unless such excess amount is less
than $5 (or such other amount set by notice or other guidance published
in the Internal Revenue Bulletin).
b. If the patient submits an incomplete financial assistance application within the
application period, UW Health will suspend any ECAs until either the patient
completes the financial assistance application and UW Health determines
whether the patient is eligible for financial assistance, OR until the patient has
failed to provide additional information up to a maximum of 240 days from the
date of the first post discharge billing statement.
i. UW Health may initiate ECAs if the patient has not submitted a complete
financial assistance application for 240 days from the date of the
patient’s first post discharge billing statement and if the notification
requirements have been met.
7. For patients who have had multiple episodes of care, UW Health may satisfy the
notification requirements under this policy simultaneously. If UW Health aggregates a
patient’s outstanding bills for multiple episodes of care, it may not initiate the ECA(s)
until after the application period for the most recent episode of care.
8. In addition, UW Health will have made reasonable efforts to determine whether an
individual is FAP eligible for care if upon receiving a complete FAP application from an
individual who the hospital believes may qualify for Medicaid, the hospital postpones
determining whether the individual is FAP eligible for care until the individual’s
Medicaid application has been completed, submitted and a determination as to the
individual’s Medicaid eligibility has been made.
9. If a patient has an outstanding balance for previously provided care, UW Health may
engage in the ECA of deferring or requiring payment before providing additional
medically necessary (but non-emergent) care only when:
a. UW Health makes a reasonable effort (as described above) to notify the
individual both orally and in writing about the financial assistance policy and
explains how to receive assistance with the application process.
b. UW Health processes on an expedited basis any FAP applications for previous
care received within the stated deadline.
C. Financial Assistance
1. Patients with incomes up to and including 500% of the FPL may be eligible for higher
discounts through the UW Health Financial Assistance Policy. See separate Financial
Assistance Policy for additional information.
D. Customer Service
1. The UW Health Revenue Cycle staff seeks to provide the highest quality service to our
customers. It is important that UW Health customers see us as an organization that is
friendly, knowledgeable, flexible, and reliable. UW Health Revenue Cycle tries to listen
to, anticipate, recognize, and satisfy UW Health’s customer's needs, with the goal of
improving collections while demonstrating commitment to Patient- and Family-Centered
Care through respect, knowledge, responsiveness, and courtesy.
2. Staff will make best efforts to respond to and document patient inquiries according to
these service standards:
a. Correspondence - Follow-up within 3 business days
b. Patient Email - Follow-up within 1 business day
c. MyChart Messages - Follow-up within 1 business day
d. Phone/Voice Mail – Return calls the same working day when possible
E. Regulatory Requirements
1. In implementing this policy, UW Health shall comply with all other federal, state, and
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local laws, rules, and regulations that may apply to activities conducted pursuant to this
UW Health Financial Statement
UW Health Administrative Policy 2.16-Financial Assistance Policy
UW Health Administrative Policy 2.26-Financial Screening for Solid Organ Transplant
VII. Adoption of this Policy by UW Health Affiliates
When this policy is adopted by an affiliate of UW Health, all references to “UW Health” in this policy
shall be references to that particular affiliate. Each UW Health affiliate adopting this policy is responsible
for its own compliance with the terms of this policy.
Sr. Management Sponsor: SVP, Chief Financial Officer
Author: VP, Revenue Cycle
Approval Committee: UW Health Administrative Policy and Procedure Committee
UW Health Chief Administrative Officer
Next revision: 072019