Hospital and other health care organizations provide services knowing that they will collected from third-party payers, such as insurance companies, considerably less than their established billing rates. In addition, they provide services to unisured patients aware that they will collect either none or only a small portion of the amounts to be billed. Respond to the following:
1. Assess how these organzations distinguish between charity care, bad debts, and contractual adjustments.
2. Determine how each one affects the amount of revenue from patient care that they should report.