By Christopher Davis, CPA
Based on our work with countless practices and physicians, we know that a few key steps taken now, before the end of the year, can help you get a great head start on 2024. Here are three proactive moves you and your team can implement to position your medical practice for a successful year:
1. Prepare Timely Financial Statements
A timely and accurate financial statement is essential to any practice for the purpose of measuring year-to-date profit and preparing a budget for the next year. The financial statements should be prepared by a qualified accountant and should be thoroughly explained to the management and partners of a practice so that everyone understands what they’re saying. Included with the financial statement should be a Statement of Cash Flow to show where the cash from the practice’s profit is going.
Preparing a realistic budget and establishing financial goals is important to ensure stability and growth in the coming year. You should have a formal plan to project revenues and expenses. Set specific, measurable financial goals aligned with your practice’s unique circumstances and objectives.
Preparing timely financial statements can also assist in detecting errors, omissions or discrepancies throughout the year. Detecting issues early can assist in exposing possible fraudulent activities and ensure your practice’s financial integrity.
2. Billing and Coding Updates
Evaluate and update billing and coding procedures to enhance reimbursements and minimize errors. Ensure your coding procedures align with industry standards and regulations. Stay informed about the latest coding revisions, like ICD-10-CM and CPT coding systems.
Optimize accuracy and efficiency by conducting a coding audit to rectify errors or inconsistencies. Train your staff on coding updates to minimize errors and maximize reimbursements. Review billing workflows to identify bottlenecks and rectify common errors in patient demographics, insurance information, or documentation.
3. Stay Current with Tax Law Changes and Claim Available Deductions
Partner with a tax professional to stay compliant with evolving tax laws and regulations. Given the dynamic nature of tax law changes, staying informed is vital to avoid penalties and optimize tax planning opportunities and deductions.
Having in-depth discussions with your practice’s tax professional throughout the year can help strategically plan for year-end purchases or investments to capitalize on available tax deductions. Consideration of your plans and goals for 2024 should be part of these discussions as there are changes in tax law including a reduction in bonus depreciation available on fixed asset purchases (equipment, furniture, leasehold improvements) for 2024. An evaluation of future equipment needs, research and development costs and potential retirement plan contributions should be part of this discussion.
Incorporating these steps will establish a solid framework for your financial success in 2024 and beyond. Now is the time to get started.
The professionals at Sol Schwartz & Associates have been supporting physicians and medical practices since 1980. Our healthcare practice team stands ready to assist you and your practice as you prepare for 2024. To learn more, contact Christopher Davis, CPA of the Sol Schwartz & Associates healthcare practice team. Or just leave your contact informtion below and we will get back to you promptly.