Approximately 65% of all bad debt is the result of insured patients, not uninsured patients, according to a national study conducted by nTelagent Inc., a Nashville-based health care revenue cycle company.

Bad debt by insured patients is caused by frequent non-collection of upfront payments such as co-pays, co-insurance, deductibles and other out-of-pocket costs, according to the survey of health care service providers. The average outstanding insured patient portion ranges from $700-$1,100.

“The findings of the study show that, in terms of bad debt, it’s not just the $10,000 bills that are causing the problem,” Earl T. Winter, chairman and CEO of nTelagent, said in a news release. “The real issue is the many thousands of smaller uncollected balances, those in the $500 to $1,000 range, belonging to insured patients. It’s the sheer volume of these instances that is causing a big problem, because payments are not being collected at the time of service.”

In the past, private or public insurance organizations paid for services and healthcare providers’ systems were built specifically to bill and accept payments from them, according to the company. However, the industry has shifted to a retail model as the patient-responsible portion of the bill has increased dramatically because of higher co-pays, co-insurance and deductibles for traditional insurance plans.

“Health care service providers must adapt to the fact that the industry has moved to a retail model, with consumers taking on more and more financial responsibility for their care,” Winter said. “Determining and initiating collections from patients at the point of service is critical, as the likelihood of collecting from patients after discharge is far less.”