An Insurance Interest Payment is an additonal amount added to a patient’s account when an insurer fails to pay a claim within the required timeframe. Medical providers receive these interest payments as compensation for delayed processing. These payments are often reported with reason codes such as PI-85 (Interest Payment), L6 (Interest Owed), or N807 (Interest due to late payment).

For example, a provider earns a $400 incentive premium payment for meeting quality performance goals. The insurer is required to issue this incentive within 30 days, but it is paid on day 55. Because the payment is late, the insurer must include an Interest Penalty Charge, in this case, $6.00, reported with reason code L6.

• Incentive premium payment: $400
• Interest Penalty Charge (L6): $6.00
• Total payment to the provider: $406.00

In this scenario, the $6.00 Interest Penalty Charge represents the insurance interest payment the provider receives due to the delayed incentive premium payment.

Create a new interest payment

Creating and posting insurance interest payments is simple and straightforward. The system makes it easy to accurately record interest earned on overdue balances and link those payments to the correct claims, helping you maintain clear and accurate records for both patient and insurance responsibilities.

Interest payments are treated the same as regular insurance payments and must be entered as their own payment record.

To begin, simply click Insurance Payment in the top navigation bar.

To enter the insurance interest payment details, click New Payment.

Enter the payment details, including the Payment Method, Payment Amount, Payment Date, and Payer. If Check is selected as the Payment Method, be sure to enter the check number in the Check Number field. After entering all details, click Create Payment.

You’ll be taken to the Insurance Payment Edit screen, where the payment details you entered appear at the top. You can update this information if needed. A payment number will also be generated and displayed in the upper-left corner. The full payment amount will show as Unapplied until it is assigned in the Payment field on the appropriate line item.

Below, link the patient by searching using their last name, first name, account number, chart number, or claim number. Select the appropriate search type from the dropdown, enter the information in the Search Patient field, and click the Search icon. If the patient doesn’t exist, click the Plus icon to add a new patient.

Link the encounter’s date of service by clicking the Chain icon to the left of the encounter number in the Unlinked tab. The encounter will move to the Linked tab, and its details will appear in the upper-right section of the screen. 

Click the Plus icon next to Miscellaneous Payments. Select the payer from the Insurance dropdown; only payers linked to the encounter will appear. For Payment Code, choose Insurance Payment, since interest payments are treated as insurance payments. Then select the appropriate Reason Code (for example, Incentive Premium Payment) to indicate the type of interest being paid. Finally, enter the interest amount in the Amount field.

Click Save & Post to post the interest payment. 

The payment will appear in the Posted tab as well as on the patient’s encounter. However, this interest payment does not apply to the patient’s outstanding balance; it is recorded separately. For example, if a patient’s encounter shows a $20 balance, and the insurance issues a $20 interest payment, the $20 will be posted but will not reduce the $20 balance.

A note will be generated for the encounter whenever an insurance interest payment is recorded, including details like the payment amount, type, reason code, posted date, and the user who created it.

If the method is a credit card, choose Credit Card from the Payment Method. Insurance credit card payments can only be manually recorded in RXNT. These cards cannot be processed directly within RXNT. 

When the payment is being made with an insurance credit card, it must be processed directly through your card reader. Alternatively, if you're using our integrated Payment Processing system, you'll need to log into PAYA Virtual Terminal to run the transaction.

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