Enter the sums of claims allowed amounts and the sum of gross charges for those claims to determine the amounts generally billed (AGB).

AGB Formula

The following formula is used to calculate amounts generally billed: 

AGB = SCA / SGC *100
  • Where AGB is the amounts generally billed (%)
  • SCA is the sum of claims allowed ($)
  • SGC is the sum of gross charges ($)

To calculate the amounts generally billed, divide the sum of claims allowed by the sum of gross charges, then multiply by 100.

AGB Definition

What is AGB?

ABG, short for amounts generally billed, is a ratio or percentage of the total amount of claims allowed by health insurers and to the sum of the gross charges.

Example Problem

How to calculate AGB?

First, determine the total amount of claims allowed by the health insurer. For this example problem, the total amount of claims allowed is found to be $10,000.00.

Next, determine the total sum of all of the gross charges. In this case, the total gross charges come out to be $30,000.00.

Finally, calculate the amount generally billed using the formula above:

AGB = SCA / SGC *100

AGB = 10,000/30,000*100

AGB = 33.33%

FAQ

What factors can affect the AGB percentage?

The AGB percentage can be affected by several factors including the negotiation power of the healthcare provider with insurance companies, the type of healthcare services provided, and the geographical location of the services. Changes in healthcare regulations and insurance policies can also impact the AGB.

How can healthcare providers use the AGB calculation in their billing practices?

Healthcare providers can use the AGB calculation to ensure their billing practices are in line with the amounts generally billed to patients with insurance. This can help in setting transparent pricing strategies and in negotiating rates with insurance companies. It also aids in financial planning by providing an estimate of the revenue from services provided.

Is the AGB calculation applicable to all types of healthcare services?

While the AGB calculation is a useful tool for many healthcare services, its applicability may vary depending on the specific billing practices and regulations of different healthcare sectors. For instance, services that are typically not covered by insurance, such as certain elective procedures, might not fit into the AGB calculation model. It’s important for healthcare providers to understand the limitations and ensure they apply the AGB calculation appropriately.