Healthcare
Provision for Denied Claims
Recording a reserve for insurance claims that are expected to be rejected due to coding or eligibility errors.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Contractual Adjustments (Denials) | Contra-Revenue (+) | 1,200.00 | - |
| Allowance for Denied Claims | Contra-Asset (+) | - | 1,200.00 |
💡 Accountant's Note
Revenue Cycle Management (RCM) experts know that ~5-10% of claims get denied. This entry ensures you don't overstate your assets by accounting for those rejections before they happen.
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