Whether you are a general practitioner, medical specialist, dentist, chiropractor, or another type of healthcare professional, paying attention to the accounting aspect of your medical practice is crucial to understanding the profitability of your business. It’s easy to say that the most important aspect of your job is taking care of patients, but without keeping up-to-date and accurate records of the expenses and revenue related to your practice, you won’t be able to continue to provide the exceptional care you are known for.
Having an accountant who specializes in healthcare accounting can help you understand your expenses and earnings, organize the financial records related to your business, and file your taxes with the most beneficial deductions related to your business.
Healthcare accounting focuses on the collection and reporting of financial records related to healthcare practices. Financial statements provide an accurate picture of what you are spending your money on. Additionally, they allow you as a business owner to make more informed decisions.
As a healthcare business owner, you may often find you often ask yourself questions like these:
With the help of a CPA who has experience working with healthcare professionals like you, you can have the peace of mind that your financial records related to your medical practice are sufficiently taken care of– making answering questions like the ones above much easier and far less confusing.
Accounting for healthcare is similar to accounting for other businesses in many ways. For instance, the same generally accepted accounting principles (GAAP) and standard accounting practices are adhered to by your CPA for healthcare accounts as they would be for other accounts.
However, along with the usual filing practices and standards, there are some unique complexities in keeping your healthcare profession’s books and generating its financial reports.
Accounting for healthcare professionals allows decision-makers at your practice to have the information at their fingertips to make important financial decisions. Just looking at the bank account and seeing how much money you have available is not an efficient way to run a successful medical practice. As the owner of your practice, you have a fiduciary responsibility to ensure your finances are in order, and what better way to ensure that than adding healthcare accounting to your toolbox of resources?
Having timely and accurate financial reports for your healthcare business allows banks to make decisions on extending credit to your practice. Additionally, looking at long-term financial goals, financial records allow your financial planners to determine how much you can save for retirement. Healthcare financials give you the power to make educated decisions for your company’s finances, the same way an X-ray can tell you where a bone may be broken, financial reports can tell you the areas of your business that need to be fixed.
Aside from just getting accurate financial statements, healthcare accounting has some nuances that fall outside the norm.
For example, if healthcare professionals are held to a high standard of being HIPAA compliant, then your accounting records are also required to be HIPAA compliant. Despite being the expert voice in your medical field and issues related to HIPAA, your extensive studies of medicine did not necessarily equip you to tackle the nuanced language and details of HIPAA-compliant accounting– this is where a certified public accountant who specializes in healthcare business accounts can help.
At Interactive Accountants, we know the ins and outs of accounting practices and procedures related to healthcare businesses. To make sure your practice is complying with the HIPAA regulations surrounding your accounting records, contact Interactive Accountants’ CPAs.
Another unique area of focus for healthcare accounting, as opposed to other business or personal accounting needs, is creating Key Performance Indicators (KPIs). Developing KPIs and tracking them can help you as a business owner measure the success of your practice.
Some examples of KPIs in the healthcare arena include:
At Interactive Accountants, we help our healthcare clients develop such KPIs and teach them how to monitor them. This way, you as the medical business owner can measure non-financial healthcare accounting trends– there is always value to understanding your practice from a new angle. These KPIs will differ depending on your title. For instance, KPIs look different for doctors, dentists, chiropractors, and other healthcare professionals. Be sure to contact Interactive Accountants before you start the process of tracking and reporting for KPIs.
Medical offices deal with a number of billing problems that are specific to their medical practice, whether through private patients or working with patients and their health insurance companies.
When bookkeeping for healthcare professionals, we take into account the collection cycles to safely manage the cash flow of your practice. Having a clear vision of the bank accounts, accounts receivable, and accounts payable, gives you a practice that has a healthy record-keeping procedure, while also offering you peace of mind.
More often than not, healthcare providers are also formed as partnerships, where the practice has multiple owners. It is important that, if this is the case, your bookkeeping needs to account for this. Using our cloud-based accounting solution, Interactive Accountants can classify your accounting records by owner and present financials that not only show the profit and loss of the practice as a whole but also by each owner. This invaluable service and resource allow multi-owner medical practices insights into profits and losses generated by each owner.
Tax law is forever changing and as a healthcare professional, you don’t have the time to keep up with these new tax laws while trying to keep up with all the updates to insurance, new treatments, and other issues related to your specialty. Interactive Accountants’ dedicated tax team knows how to handle the unique details of healthcare tax filing and deductions.
All of our CPAs are required to maintain 40 hours of continuing education every year in understanding the most up-to-date tax practices. Furthermore, our enrolled agents take at least 20 hours of continuing education every year, making sure we are on top of every new tax law that affects you and your business in the healthcare industry.
We take the time every quarter to review our clients’ tax situations and to discuss the planning opportunities available. When working with our dedicated CPAs, discussing the changes in your business and personal life is made easy– we incorporate the best tax deductions or credits that are available to you under current law.
Interactive Accountants always take a proactive approach to your tax matters. Choosing an accountant to prepare your tax documents who understands and has experience in working with doctors, dentists, chiropractors, and other healthcare professionals is the step you need in making the best choice for your medical practice.
If you are a healthcare professional, it is important to hire a CPA firm that truly understands the unique circumstances of working in your field.
At Interactive Accountants, our owner Matthew Shiebler, CPA has worked with doctors, chiropractors, dentists, and other healthcare professionals for over 25 years. Having kept their records up-to-date and compliant, Mr. Shiebler knows what it takes to properly prepare your records and books for tax season.
Give us a call at (305) 517-3977 or schedule a free consultation online with us today!