When it comes to establishing a medical practice, getting an accountant may be the last thing you want to do. It would help if you also considered many other factors, such as choosing the right location, hiring employees, setting up your bank account, and preparing the clinic for new patients.
Nonetheless, it would be best to have a strong accounting team for the medical practice to help you save money on the practices’ tax bills and help you plan for the future of the business. Below are some ways that you can simplify your medical practice.
3 Ways to Simplify Accounting at Medical Practice
1. Implementing An Accounts Payable System
After opening your medical practice, you will have bills to pay. Suppliers will send you invoices, and you will also need to pay the rent, utility, water, and other expenses. This is why you need to set up a system that will help you track these expenses regularly.
You can ask your accountant to create a process for every new invoice you get, input all the expenses in accounting software, make copies of these invoices for future reference, and keep a log of every cheque you write. The process will ensure that you pay all your invoices on time and record all recurring payments.
For instance, if you have set up a dermatology practice, software dealing with dermatology medical billing and coding will help you maximize reimbursement by paying particular attention to insurance billing guidelines. As the medical practice grows, you may have to automate the accounts payable process or get better accounting software to help.
2. Establishing a Payroll System
Accounting for the medical practice also means that you need a payroll system. The process does not have to be tricky, but it should be well organized. Your medical practice will determine how to do your payroll, but you must be highly knowledgeable in the provincial and federal regulations.
Moreover, you will need proper planning. Because there are numerous federal and provincial requirements such as overtime, keeping records, source deductions, you may feel overwhelmed. The good thing is that you don’t need to handle the challenge alone. You can join hands with your accountant and staff to develop a payroll system that caters to their needs and the needs of your medical practice.
One of the things you must consider is the amount of cash to put out monthly. Since you are just starting, you have the flexibility to choose how much you will pay your staff and yourself. You also have to decide the number of employees to hire in the office.
If you have a good idea of the money to give out, you will have a better idea of the kind of system that suits your medical practice. Setting up a manual payroll system might not be a good idea because a slight error in your employees’ payroll deductions may cost your practice a tax season. That’s why you need payroll management software to make things easy and avoid errors.
3. Implementing an accounts receivable system
Another critical system you will need to simplify accounting is the accounts receivable. An account receivable helps you track and receive your income for the practice. The nature of your practice will determine how your system will look.
For instance, if you have a dermatology practice, do you see private clients or bill insurers? A billing system will help you stay organized with the accounts receivable. You will be able to see the income and bills over the month. It will allow you to track how much you have worked and process all claims. It’s essential to keep track of your accounts receivable so you can maintain all your financial statements.
Keeping track of your finances is the hardest part of opening your medical practice. However, you can simplify accounting in medical practice by following the tips mentioned above.
Author: Stephanie Caroline Snyder
Stephanie Caroline Snyder is a 27-year-old who graduated from The University of Florida in 2018. She majored in Communications with a minor in mass media. Currently, she is an a href=”https://stephaniesnyder.substack.com” rel=”noopener”>Author and a href=”https://www.klusster.com/portfolios/stephanie-caroline-snyder” rel=”noopener”>Writer. She was born and raised in Panama City, Florida, where her family still lives.