Definition - What does Provider Write-Off mean?
A provider write-off is the amount eliminated from the fees for a service provided by a facility that serves as a healthcare provider for an insurance company. The write-off could be in the form of not billing the insured for certain services that exceed the allowable costs set in place by the insurance company.
Insuranceopedia explains Provider Write-Off
A health insurance company has a network of health facilities, such as hospitals and clinics, that provide services for its policyholders. As part of the network, they bill the policyholders in a different way than those who aren't.
For every health service, there is an allowable payment. Their accounting system them writes off any amount in excess of that allowable payment. For instance, if a procedure is normally be billed for $100, but as part of the network, the facility is only allowed to charge policyholders $95, then the excess $5 is written off.