CHAPTER 20

whenever you do bookkeeping you do bookkeeping, you should shrive for

100% accuracy

Accounts Payable

Money owed by a business

which federal act states that patients must know ahead of time if credit extension will include interest fess

TLA

Accounting

The process of communicating the income and expenses of a business and its financial health

Cashier's Check

a bank check issued by a bank on bank paper and signed by a bank representative, usually purchased by individuals who don't have checking accounts

Check

a bank draft or order written by a payer that directs the bank to pay a sum of money on demand to the payee

Voucher Check

a business check with an attached stub, which is kept as a receipt

Money Order

a certificate of guaranteed payment, which my be purchased from a bank, post office or some convenience stores

Third party checks

a check made out to one recipient and given in payment to another , as with one made out to a pt rather than the medical practice

Travelers Check

a check purchased and signed at a bank and later signed over to a payee

Limited check

a check that is void after a certain time limit; commonly used for a payroll

which of the following describes a cashier's check

a check written on a bank paper and signed by a bank representative

Credit Bureau

a company that provides information about the creditworthiness of a person seeking credit

Reconciliation

a comparison of the offices financial records with bank records to ensure that they are consistent and accurate, usually done when the monthly checking account statement is received from the bank

ABA Number

a fraction appearing in the upper right corner of all printed checks that identifies the geographic area and the specific bank on which the check is drawn

Write-it-once (pegboard) system

a manual bookkeeping system where the daily log has prepunched holes on the right or left side of the log. Prepunched charge sheets are placed in designated areas on the pegboard. The pt ledger care placed between the day sheet and the charge sheet and an entry is made; it appears on all three documents at the same time

Certified Check

a payers check written and signed by the payer, which is stamped "certified" by the bank. The bank has already drawn money from the payers account to guarantee that the check will be paid

Payer

a person who pays a bill or writes a check

Payee

a person who receives a payment

Skip

a pt who has moved out without leaving a forwarding address and his bill is unpaid

Counter Check

a special bank check that allows a depositor to draw funds from his own account only, as when he has forgotten his checkbook

Statue of limitations

a state law that sets a time limit on when a collection suit on a past due account can legally be filed

Cycle Billing

a system that sends invoices to groups of pts every few days, spreading the work of billing all the pts over the month while billing each pt only once

which of the following checks should not be accepted by the medical office

a third-party check made out to the patient

Disclosure Statement

a written description of agreed terms of payment, aka: a federal truth in lending statement

Truth in Lending Statements

a written description of the agreed terms of payment between the pt and medical practice when payment will be made in more than 4 installments

a disclosure statement is

a written description of the terms of payment

Single entry account

an account that has only one charge, usually for a small amount, for a pt who does not come in regularly

Open book account

an account that is open to charges made occasionally as needed

Written-contract Account

an agreement between the physician and pt stating that the pt will pay a bill in more than four installments

Credit

an extension of time to pay for services, which are provided on trust

fees must be determined in order to create a:

charge slip

most disbursements are made by

check

when reconciling a bank statement, the first thing you should do is

check the closing balance on the previous statement against the opening balance on the new statement

the most commonly used bookkeeping system is the

computerized system

what is a common billing system that bills each patient only once a month but spreads the work of billing over a month

cycle billing

which of the following terms means that a check is accepted as payment

endorsement

Accounts Receivable

income or money owed to a business

an NSF payment is one that

is returned by the bank for nonsufficient funds

what role does the fee schedule play in patient accounts

it determines the amounts you should bill for services

tracking disbursement expenses by category is important because

it helps control expenses

when do many smaller practices send out their bills

just after the end of each month

Negotiable

legally transferable from one person to another

who is responsible for collecting patient payments

medical assistant

which of the following requires a physician to provide care to individuals who need it, regardless of their ability to pay

medical ethics

how often should you reconcile a bank statement

monthly

how often should a patient receive a billing statement

once a month

what happens when a patient moves but does not leave a forwarding address

patient is considered a skip

the purpose of endorsing a check is to

prevent the check from being cashed if lost or stolen

a credit bureau is

responsible for providing creditworthiness of a person seeking credit

Endorsement

signature on the back of a check with the terms for accepting the check as a payment

in what ways do practices approach the task of collection

telephone calls, letters, or statements

a major advantage of a computerized bookkeeping system over a manual one is

the amount of time saved

the most likely reason some deposits are not showing up on the bank statement is

the deposits were not recorded at the time the statement was created

if you are using cycle billing and a patient's last name begins with "D," when will you most likely bill this patient

the fifth of the month

Power of attorney

the legal right to act as the attorney or agent of another person, including handling that person's financial matters

Age analysis

the process of clarifying and reviewing past due accounts by age from the first date of biling

Journalizing

the process of logging charges and receipts in chronological list each day; used in bookkeeping

Guarantor

the pt, caregiver or entity responsible for a payment of the healthcare bill

Cash Flow Statement

the statement that shows the cash on hand at the beginning of a period, the income and disbursements made during the period and the new amount of cash on hand at the end of the period

Bookkeeping

the systematic recording of business transactions

which of the following is true regarding a computerized bookkeeping system

understanding manual bookkeeping tasks is an essential part of managing books on a computer

when performing electronic banking, you should

use a password to access the electronic checkbook register

tracking

watching for changes in spending so as to help control expenses

when can you send a final letter

when an account is 120 days past due

the only time you should accept a check signed by someone other than the payer is

when the person who signed the check has power of attorney

when payment has not been received, the first phone call to the patient should occur

within 30-45 days