BSmith - can we get a bit more complicated here? I'm intrigued by the "know how to do it on paper in case the EMR is not available" angle. To get to my question, let's see if we first agree on the basics:

First - Accounting 101 teaches the double-entry concept. On the books, for every credit there must be a corresponding debit. And for every debit, there must be a corresponding credit. So that when you eventually total everything, everything totals to zero - debits and credits must equal each other. Hopefully your instructor is not denying this fact.

Second - a copay is a co-payment, right? Co-payment against what? There has to be a charge - elsewise no payment is due. So - the copay is a partial payment against some charge. Since the payment is only partial, debits and credits don't have to equal each other at this point. But there does need to be a charge against which the copay can eventually be applied. Hopefully your instructor is not denying this fact.

We routinely get payments / copays for services rendered before we get the actual charges. Our software has an "Unapplied" bucket in the ledger for each patient. On those times where we receive the payment before we receive the charge, we post the payment to the Unapplied bucket. When the charges come in and are posted, we apply the payments held in the Unapplied bucket to those charges. I imagine any billing software worth anything has a simliar setup, although the name of the "holding" bucket might be different.

**QUESTION:** Does the paper solution your teacher is getting you familiar with have something equivalent to the "Unapplied" bucket in my billing software? That is, is there a special place to hold payments that have no corresponding charge until the charges come in? Or are you just expected to write the payment in the patient's general ledger - and it will be out-of-balance until the corresponding charges come in?