Disclaimer: This article is for informational purposes only and does not constitute legal advice.
Detailed Answer
In Florida, a statement of account is a document—often issued by a creditor, service provider or attorney—that itemizes debits (charges) and credits (payments or adjustments) related to services or goods provided. Payments from insurance companies or government programs (such as Medicare or Medicaid) qualify as third-party credits. They do not create new charges; instead, they offset the existing balance due.
Typically, a statement of account follows a two-column format in accordance with generally accepted accounting principles (GAAP) and, when prepared by an attorney, the Rules Regulating The Florida Bar:
- Debits/Charges: Line items for fees, services rendered, costs advanced, late fees and interest.
- Credits/Payments: Line items for payments received from the client, insurance carriers or government payers.
Insurance or government program payments always appear in the Credits/Payments section. You will often see a header such as “Payments Received,” “Insurance Payments” or “Third-Party Credits.” Each credit entry should list:
- Date of payment
- Name of the payer (e.g., Florida Medicaid or Blue Cross Blue Shield)
- Payment amount
These credits directly reduce the total amount you owe. For example, if a healthcare provider bills $5,000 and the insurer remits $3,500, the statement will display a $3,500 credit, leaving a net balance of $1,500.
When attorneys handle settlement funds, they must also comply with the Rules Regulating The Florida Bar, Rule 5-1.2 concerning client ledger records. That rule mandates accurate recording of all receipts and disbursements. Accordingly, any insurance or government payment received on a client’s behalf appears first as a receipt in the client trust ledger, then is applied toward fees, costs or client disbursements.
Relevant Authority
- Rules Regulating The Florida Bar, Rule 5-1.2 (Client ledger records): https://www.floridabar.org/rules/rrtfb/ (search for Rule 5-1.2)
Helpful Hints
- Consult the statement’s legend or footnotes to understand how credits are labeled.
- Match each credit on the statement with your Explanation of Benefits (EOB) or Medicaid Remittance Advice.
- Retain copies of all EOBs or remittance advices for your records in case of discrepancies.
- Contact your provider’s billing department if you see unfamiliar credits or amounts.
- Seek guidance from a qualified attorney or certified public accountant if credits do not align with third-party remittances.