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by Madeline Angela Meyer and Michael Alan Meyer


“Banks are not the only lending institutions;  Physicians & Hospitals are too!”

Lending Institutions 

Medical providers are lending institutions! Physicians and hospitals extend credit to tens of thousands of people every year. Therefore, it stands to reason that providers would have a comprehensive credit policy to guide both their staff and their patients in matters of finance.  After all, all lending institutions provide loans, but no lending institution does it without communicating the terms.  The patient’s perception of quality of medical care begins with their registration process and ends with their account resolution.  No physician or hospital wants the satisfaction of their medical care to be determined by poor billing and collections activities and policies.  It has long been recognized that accounts receivable issues are an unspoken denominator in many malpractice cases (Meyers, 1987).  In an industry undergoing constant change, developing a good credit policy and keeping it current is critical to customer satisfaction and business success.

Credit Policies

There is no cookie cutter credit policy, because how they are written will depend on the provider’s medical and managed care markets, the contracts that they have signed, and in an era of consolidation, the Accountable Care Organizations (ACOs), organizational structure.  However, regardless of those key factors, there are important fundamentals that goes into any credit policy, e.g., the who, what, when, where, why and how’s of the lender.

Attached is an example credit policy template.  The policy needs to be a living breathing, readable and user-friendly tool.  Its core lending policies should be summarized in a patient brochure or document, which is provided to all new patients.  When the policies are updated, established and new patients should be provided with a copy of the new policies.  Any credit policy written and used by a medical facility should be reviewed and approved by both the accounting and law firms that provides consultation to your medical business.  Your medical billing software vendor also can provide major insight and assistance in automating and documenting credit policies and streamling them into effective and efficient accounts receivable management processes.

Click here for a comprehensive credit policy template:  XYZ Clinic Credit Policy!


Huntington, BSN, MSN, JD, Beth. Kuhn, RN, BSPA, CPHRM, Nettie. (2003). Communication gaffes: a root cause of malpractice claims.  Proceedings (Baylor University. Medical Center).  2003 Apr; 16(2)157-161

Meyers,  A.R. (1987).  “Lumping it”: the hidden denominator of the medical malpractice crisis. American Journal of Public Health. 1987;77:1544–1548.

Meyer, Michael A., Meyer, Madeline A. (2007-2012) Tier I. Module V. Medical Reimbursement. Medical Coding Preparatory® 5th Edition. eBook Self-Publication, 2012.


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