A system and method for consistently, reliably and equitably discounting medical bills of self-pay patients includes a networked discounting engine operably coupled to a plurality of databases. The discounting engine is adapted to receive patient account data from one or more patient registration systems. Based upon the patient account data received, the discounting engine accesses the plurality of databases to determine financial, asset and demographic attributes for a patient or responsible party. Based upon the patient account data received, and the determined financial, asset and demographic variable values, the discounting engine determines weights and points. Weights and points are then combined by the discounting engine to determine a weighted discount percentage to be applied against the patient's outstanding account balance. The discounting engine then generates and sends to the patient registration system an output file containing the discount percentage and other patient information. This information along with other billing information is communicated to a patient accounting system for preparing a discounted bill.