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Manage your Medical Business Effectively by Healthcare Accounting Services

Last updated: 28 Jul, 2023 By | 6 Minutes Read

Medical practice today has crossed the conventional borders of healthcare and is now considered as an industry no less than any other of its kind. This is the primary reason why it is termed as medical business. In this scenario, all the pushes and pulls that play a very important part in most businesses are equally relevant for the medical sector too.

In fact, it is more so because at the core of the business are doctors and other health care professionals who have to focus on the primary task of delivering medical care. In other industries, a slip-up can be modified – not so in the medical profession.

This makes it imperative that an environment be created in healthcare where the main players need not focus on any other activity. You should parcel off ancillary and support services to agencies and companies who excel in offering these to hospitals and health care institutions.

Here, some may argue, why not have a whole set up in-house and make a medical institution fully self reliant. The answer is a NO, simply because it makes bad business sense. The healthcare industry operates on razor thin margins and if you have to invest in setting up infrastructure to run support services, you’ll be in no state to go for business expansion and diversification.

There are so many areas that you can outsource without affecting the quality of services in any manner. Catering, cleaning, laundry maintenance can all be outsourced. Processing of claims, litigation with regard to payer reimbursement disputes, internal audits and reviews, and management of pharmacies can be taken care of by external agencies, not to forget optimum utilization of your accounting and bookkeeping services.

The latter is very important because financial considerations lie at the center of almost any business operation. Some of the sectors within the healthcare industry that have opted to fully outsource bookkeeping tasks and are reaping the benefits include hospitals, nursing care facilities, veterinary services, dentist chambers, outpatient care centers, and medical laboratories.

Key accounting functions that should be outsourced in the medical business

Processing of vendor bills

Any healthcare facility is heavily dependent on supplies of consumables for effective functioning. Therefore there will literally be hundreds of invoices to deal with every month. However, when you outsource, the full process will be taken care of, the invoices will be received by them, date stamped and tracked throughout the life cycle till realization. Scanned copies will be uploaded to you for authentication only.
Even the payments to be received by you will be monitored by the agencies. Hence, at any point of time, you can know the state of your financials since the reports of payables and receivables can be accessed by you on a real-time basis.

Tax computation and payroll management

For any healthcare institution this is truly a complex task. There are two aspects to it, personal income tax and others. From the commercial point of view there will be a whole lot of accounting heads to consider, each with its own tax rate.

Accounting for healthcarewill comprehensively process the full tax computation function, right from calculations to filing of returns of individuals as well as the corporate entity keeping in mind both State and Federal requirements. Apart from these routine activities and payroll management, outsourced services use sophisticated software to complete employee documentation too on your behalf.

This include submission of particulars of all employees hired or rehired by you to state authorities so that any fraudulent claims of child support or unemployment compensation can be avoided.

Processing of claims and medical insurance

This is at the core of the any medical business today but ensuring that it runs smoothly is not easy especially for large corporate hospitals and institutions. It is because there are many insurance companies offering specific benefits to their policy holders. Outsourcing agencies are very well conversant with the terms and conditions and can therefore process a claim quickly and effectively.

By having the time gap between delivery of services and receiving of reimbursements from the insurance companies reduced to the bare minimum, you will not face a crunch in working capital requirements.

Audit, financial statements and reviews

Healthcare accounting services will also generate updated reports for you so that you are always aware of your financial position and can work out business strategies accordingly. One of the reports will be a certificate on monthly balancing of bank and credit card transactions. This will enable you to be sure that all your payables and receivables have been correctly accounted for. Based on these statements you can review your profitability and cash flow position. Accounting services will also audit your books of accounts to confirm the accuracy of your balance sheet.

By outsourcing your bookkeeping functions, you can concentrate on delivering top of the line medical care to your patients without being bogged down or being mentally diverted from the main task at hand.

Read Also: Outsource Accounting Services – A Simple Solution for Doctors and Healthcare Clinics

One of the industry leaders in health care accounting services is Cogneesol. We have a team of trained accountants that can deliver consistent results and the best of bookkeeping services. To know more, contact us at [email protected].