Cleaning up Invoices
This process is extremely important when trying to understand a client’s balance!
How Invoices Work
Invoices are like polaroid pictures. The system takes a snapshot of the appointment on the day it occurs. If something changes, the system doesn’t change the original snapshot, it creates a new snapshot, an “adjustment invoice”, that adds or subtracts an amount from the fee on the original invoice to make the total match the fee on the appointment itself.
Examples
Original fee: $0 —> Original Invoice : $0
Updated fee: $20 —> Adjustment invoice: $20
Original fee: $100 - Original invoice: $100
Updated fee: $20 - Adjustment invoice: -$80
Why we clean up invoices
All invoices are dated the date they are created. This is fine if the invoice was created the same day as the appointment.
Where it starts to cause issues is when the adjustment invoices come through, they are dated the date that they were created. So when you create a statement, it’s almost impossible to figure out the true charge for a given date of service.
Running an easy-to-read statement is essential when trying to understand a client balance or credit, for both ourselves and our clients.
So when we create a statement, and it doesn’t make sense, we need to clean up the invoices.
My Invoice Motto
Invoices for each date of service need to match the date of service.
Steps
For any date of service with more than one invoice, delete all adjustment invoices. Leave the original invoice intact!
New > Invoice
Choose one date of service (if there are multiple to choose from)
Create invoice
Change the issue date to match the date of service on the invoice line item
Save and close
Repeat for each date of service that has multiple invoices (you may have to go back quite a ways to find them all. It’s best to work oldest to newest)
Click ‘Add Payment’ and allocate funds back to the new invoices
Now when you run your statement you’ll be able to see the original fee and adjustment(s) for each date of service and each payment in chronological order.
Note that the time stamp of these invoice may put them a little out of order for each date, but it should still be pretty easy to follow.
If there are any mistakes with fees or payments, you’ll be able to see them quickly and easily. You’ll also feel good about giving this statement to a client because they will also be able to understand their balance.
Tip - Make sure the client’s copay is set correctly once you know what it is. This reduces the number of adjustment invoices that will occur since the amount will already match the EOB.