In medical billing, when is an account typically classified as 'bad debt'?

An account is typically classified as 'bad debt' in medical billing once all collection efforts have failed to secure payment from the patient or responsible party. This classification signifies that the provider has exhausted all reasonable avenues to collect the owed funds and has determined that further attempts would likely be unproductive. This usually includes sending reminders, contacting the patient by phone, and possibly engaging a collection agency.

The other choices pertain to circumstances that do not imply a total lack of payment. Initiating a payment plan indicates that there is an agreement to pay and that the account is still active rather than classified as bad debt. Similarly, if a payment is partially made, it suggests that some obligation has been fulfilled, which means the account remains healthy or active. Lastly, a patient making a complaint does not directly relate to their financial obligations and does not determine the status of an account regarding debt classification. Thus, the defining factor for bad debt is the complete failure of collection efforts.