We all know that managing a medical practice doesn’t end with providing a stellar service to patients. Medical practitioners are not exempt from the business side of their operations, which means that, in addition to saving lives, doctor’s practices also have to manage suppliers, code-compliance and human resource issues. This is where Management Service Organizations (MSOs) come in.
Management Service Organizations provide administrative and management services to healthcare providers including billing, coding, and collections with the goal of alleviating them from the day-to-day admin and finance duties while ensuring regulatory compliance. This is no easy task, especially when managing the administrative portfolios of a number of medical practices, across different medical specialties. This is where outsourced CFO services come in. We take a look at some of the ways in which MSOs can benefit from outsourced accounting services.
Benefits of outsourced accounting services for MSOs
Want to imagine what the accounts receivable ledgers look like of an MSO running the administrative functions of numerous medical practices? We’re sure you don’t. Having to track and stay abreast of the collections, billings, accounts payable and receivables of these medical practices can be daunting. Having to ensure up-to-date financial records while offering quality service to patients can be a lot to juggle, and failure to comply with legal and financial regulations can also result in penalties for this industry.
Employing the strategies and services of outsourced accounting firms that typically handle the financial aspects of a business can be greatly beneficial to the MSO field.
MSOs benefit from outsourcing accounting services in the following ways:
1. They ensure the right accounting software is implemented to streamline financial processes
Accounting software with comprehensive and high customization ability is highly beneficial to MSOs. NetSuite offers a range of features that include financial management, inventory management, and customer relationship management. This makes it an all-in-one solution to help MSOs manage their operations more efficiently. Outsourced accountants are experts in the management and setup of accounting software. Having the software set up correctly is one of the most important steps in the software implementation process, because an incorrect setup could mean a mess in accounting records which could ultimately affect compliance.
There are so many moving parts when it comes to managing mass invoices – updating accounts when emergency procedures get done etc., this requires a high-functioning software with all the right integrations to ensure the records of clients remain accurate and up-to-date.
2. They aid in managing risks
Employing outsourced accounting services can aid MSOs in managing and mitigating potential risks. MSOs must manage their finances effectively to remain profitable. Poor financial management, such as overspending, underpricing services, or inadequate insurance coverage, can lead to financial losses and ultimately put the MSO’s operations at risk.
Outsourced accounting firms study the financial data to identify possible threats and implement risk mitigation strategies in terms of bad debts and wasteful spending, and can also flag possible risks for bad payers. To fully safeguard against this they implement tight controls and reliable software to help mitigate some of these risks – this also includes software that protects MSOs against data breaches. This is crucial for management service organizations as they handle a vast amount of sensitive data, including patient health information and more.
3. They aid with tax and business growth strategies
When MSOs outsource accounting functions, they may save on the costs of appointing a full-time in-house team. Outsourced accountants have access to the latest technology in accounting and have specialized expertise as they stay abreast latest industry advancements and changes. This means that not only do businesses have access to experts that can help them save some money on their tax returns, they can also benefit from the broader savings that come with these professionals. In addition to saving them money on costly in-house teams, they can also benefit from their insights into the numbers within a business – their ability to look at the status of accounts receivable reports and make predictions and develop strategies on the potential of the scalability of medical practices based off these numbers.
4. They help MSOs save time
Managing financial aspects can be time-consuming, and outsourcing accounting services can free up valuable time for MSOs to focus on their core competencies. Because experienced accounting firms have access to the latest accounting software and technology, they can implement automation for many routine accounting tasks. This can save the MSO time and reduce the risk of errors.
From aiding Management Service Organizations to save time, avoid administrative clutter and gain accurate insights into the business side of their medical practices, to managing financial operations effectively; outsourcing accounting functions can free up valuable time for MSOs to focus on providing quality healthcare services to their clients.
At Fusion CPA, we can help you manage your MSO. We can assist with all your accounting needs but also develop winning tax strategies to save your business money, and implement the most recommended software and integrations to automate the processes that really do not require manual inputs. Contact us for a consult today.
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.