Understanding the logic for adjusting fee payer contributions

4 minute read

When a fee payer’s contribution changes —  the manage contribution functionality within Found ensures that the resident’s contributions and invoicing remain accurate. This includes automatically calculating and generating any required care fee adjustments to identify the difference between previous and updated funding contributions, including when contributions are backdated.

Understanding the logic

When a Fee Payer’s contribution is adjusted, the Found product follows a structured process to determine the financial impact and ensure correct billing:

1. Identify the impacted period

The product will first identify the period impacted by the contribution change. This period begins from the Date of Contribution Change, which is selected when:

• Adjusting a fee payers contribution
• Backdating a fee payers contribution
• Editing an existing fee payer’s contribution

The end of this impacted period is determined by one of the following:

• A newer contribution change recorded in the contribution history, or
• The latest invoiced period at the previous contribution rate.

2. Calculate the difference 

For the impacted time period, Found will calculate:

• What should have been invoiced, based on the fee payers updated contribution rate and number of days in the impacted period.
• What was actually invoiced, considering:
  • All invoices (excluding voided ones),
  • All credit notes (excluding voided ones),
  • Any overlapping care Fee Adjustments generated from prior contribution changes and determining if they’ve been invoiced or not

3. Reconcile any discrepancies

If a difference is identified between what was charged and what should have been charged, Found will take the following actions:

• Remove or update any existing Care Fee Adjustments that overlap and:
  • Are not yet attached to a financial document,
  • Have a status of Outstanding or Scheduled.
• Create new Care Fee Adjustments to correct the discrepancy:
  • A negative value (credit) if the Fee Payer was overcharged (e.g. the updated contribution is lower than what was originally invoiced).
  • A positive value (charge) if the Fee Payer was undercharged (e.g. the updated contribution is higher than what was originally invoiced).

Please note: Found will never alter existing invoices or credit notes. Any corrections required as a result of the contribution change will be addressed solely through the generation of Care Fee Adjustments.

4. How adjustments are applied

Following their creation, Care Fee Adjustments can be handled in one of the following ways:

Summary

By adjusting a fee payer’s contribution using Found, you can ensure accurate billing and maintain clear audit trails. 

The products built-in logic automates the reconciliation process, saving time and reducing the risk of manual error — whether you are updating contributions going forward or applying changes retrospectively.