[Early Access] LEDES Support for Split Billing

When a matter is split between multiple payors, each one receives their own invoice for their share. LEDES support extends that to e-billing: each payor's LEDES file reflects their allocation, in the format their billing system expects, without anyone rebuilding the file by hand.

This matters most where it costs the most. An insurance carrier's billing platform doesn't short-pay a file it can't read — it rejects it, and the invoice sits while someone figures out why. Getting the allocation into the file correctly the first time is the difference between billing on schedule and chasing a submission three weeks later.

How LEDES Split Billing Works: The Core Concept

Split billing already produces a separate invoice per payor. LEDES support adds a step: when you download the LEDES file for one of those invoices, LeanLaw adjusts the file to that payor's share before writing it.

The adjustment happens at download time, in the file only. It does not change the invoice, the line items, or anything in QuickBooks.

The method is a matter-level setting. Each matter in a split — primary and secondary alike — carries its own Split Billing Method, and each one's invoices generate their own LEDES file. A secondary matter configures its own LEDES settings and downloads its own file exactly as the primary does.

The Two Methods

Full Invoice (No Adjustment)

The LEDES file contains the full, unadjusted line items. Every payor receives an identical file showing 100% of the charges, and the payors reconcile the split between themselves.
Use this when your payors expect to see the complete invoice and handle the allocation on their end.

Invoice-Level Adjustment

The LEDES file contains the full line items, followed by a single adjustment line that reduces the total to that payor's share. This is the industry standard, and the method most carrier billing platforms expect.

With this method, if you have a $3,229.00 invoice with $3,000.00 in fees and $229.00 in expenses, and that invoice's matter were configured with 11% of the split billing share, its LEDES file would have the INVOICE TOTAL amount adjusted, and the file would gain two lines that look something like this:

20260131|997658|ENCOVA|HEMBREE-001|355.19|20260101|20260131|Final|3|IF|1|-2670.00|-2670.00|20260131|||||Split billing adjustment - Fees|FIRM-01|-2670.00|||HEMBREE-001[]

20260131|997658|ENCOVA|HEMBREE-001|355.19|20260101|20260131|Final|4|IE|1|-203.81|-203.81|20260131|||||Split billing adjustment - Expenses|FIRM-01|-203.81|||HEMBREE-001[] 

Fees and expenses are adjusted on separate lines so each one carries the correct LEDES type: IF for the invoice-level fee adjustment, IE for the expense adjustment. The original line items are never modified. Instead, the adjustment is appended at the end of the file. Every amount is rounded to two decimal places at the line level.

Line Item Allocation (coming soon)

A third method, which adjusts each individual line item to the payor's percentage rather than adding one adjustment at the end, is coming in a future release.

Configuring your LEDES adjustment type

1. Open the matter and go to its LEDES tab

2. Find Split Billing Method and choose an adjustment type

3. Optionally add an **Adjustment Description** (up to 200 characters)

4. Save

Repeat for each matter in the split whose payor requires a LEDES file.

If you leave the method unset, LEDES files will download with no adjustment. Nothing breaks, but the payor receives a file showing the full invoice rather than their share, so set it deliberately on any matter using Invoice-Level Adjustment.

The Adjustment Description setting

The description you enter appears on the adjustment lines in the file, with `- Fees` and `- Expenses` appended. Entering `Indiana Farm Bureau 11% allocation` produces:
Indiana Farm Bureau 11% allocation - Fees Indiana Farm Bureau 11% allocation - Expenses

Leave it blank and the lines read `Split billing adjustment - Fees` and `Split billing adjustment - Expenses`. Use it when a payor needs to see the allocation named on the file itself.

Billing Workflow

Your billing cycle doesn't change. Record time and expenses on the primary matter, draft and submit as usual, and let LeanLaw generate the separate invoices per payor.
When you're ready to submit to a payor's e-billing platform, download the LEDES file from that payor's invoice on the Manage Invoices page. The adjustment is automatically applied as the file is generated, based on the method set on that invoice's matter.

Requirements and Limitations

LEDES 98B only. Invoice-Level Adjustment is supported on LEDES 98B in this release. If the client is configured for LEDES 2000 or LEDES XML 2.0, the download stops with this alert:

Split Billing Adjustments Are Only Available On LEDES 98b. Please change your LEDES settings.

Change the client's LEDES format to 98B if the payor accepts it. If the payor requires one of the other formats, contact support — the underlying architecture supports extending to them, and knowing which firms need it is what moves it up the list.

Multi-matter invoices ignore split billing. Split-billing is only available for invoices containing one matter's billables. If an invoice is configured for Client Accounting and has more than one matter's billables on it, it will not be split and no LEDES adjustment settings will be applied, regardless of the method configured.

Adjustment settings are per matter. There is no client-level default yet, so a client with several split matters needs the method set on each one. Setting it at the client level is a planned enhancement.

Enabling LEDES Split Billing (Early Access)

LEDES support for split billing is in Early Access and turned on per firm. If your firm is on Pro or Elite and you don't see the Split Billing Method setting on a matter's LEDES tab, contact support to have it enabled.