In an underpayment scenario with Billed Amount $5,000; Expected Amount $4,000; Allowed $3,000; Posted Write-Off $2,000, which write-off option is being used?

• A. Write-Off Payor
• B. Suppress Write-Off
• C. Write-Off Expected
• D. Write-Off Expected and Variance Separately

Answer: (A)

When an underpayment occurs, the write-off method determines who absorbs the shortfall and how the remaining balance is reflected. Here, the billed amount is 5,000 and the allowed amount is 3,000, leaving a shortfall of 2,000. The system posting a 2,000 write-off reduces the payer’s liability from the billed amount down to the allowed amount. That is exactly what a write-off to the payor does: it brings the payer’s responsibility to the allowed amount (3,000) by writing off the difference (2,000).

The other options don’t fit this scenario: writing off to the expected amount would imply reaching 4,000 (a 1,000 write-off), which isn’t what the numbers show. Suppressing a write-off hides the adjustment rather than applying it to the payer, and splitting into “expected and variance separately” would involve two separate adjustments, which isn’t reflected here.