Medical practice bookkeeping: the document checklist

The defining feature is that billed and collected are different numbers by design. A practice bills a fee schedule; the payer allows a contracted rate; the difference is a contractual adjustment, not bad debt. Patient responsibility arrives separately and later.

The practical difficulty is that the EMR or practice management system holds the truth, the bookkeeper usually has limited access to it, and the reports it produces were not designed for reconciliation. Sort access out at onboarding.

Request every month

Deposit reports from the EMR are the anchor document.

• Deposit or payment posting report from the EMR / practice management system
• Insurance remittance advice (ERA / EOB summaries) showing billed, allowed, adjustment and paid
• Patient payment reports — copays, deductibles, self-pay
• Accounts receivable ageing by payer
• Bank statements for every account, including any merchant or lockbox account
• Merchant processor statements for card payments taken at the desk
• Credit card statements
• Payroll reports, separating clinical and administrative staff
• Contractor physician or locum invoices and agreements
• Medical supply, drug and lab invoices
• Equipment lease and maintenance contracts
• Rent, utilities and practice insurance (including malpractice) statements

Request quarterly or annually

• Quarterly: payroll tax filings and any retirement plan contribution records.
• Annually: malpractice insurance renewal and any tail coverage.
• Annually: W-9s and 1099s for contract physicians, locums and therapists — practices frequently have many.
• Annually: equipment purchases and finance agreements for the depreciation schedule.
• Annually: licensing and credentialing renewals.

Ask before you onboard

These are the questions that decide whether you have priced the engagement correctly. Ask them on the first call, not in month three.

• Which EMR or practice management system, and can I get read-only financial reporting access?
• Which payers, and is billing done in-house or by a billing company?
• Are contractual adjustments already being posted, or does revenue look inflated?
• How many contract physicians or therapists, and are agreements in place?
• Do you need a business associate agreement from me?
• Is there a lockbox or separate deposit account?
• Who reconciles the patient AR, and how often?
• Are deposits from the EMR arriving directly, or through a third party?

Traps that catch bookkeepers new to medical practices

Booking billed amounts as revenue. Gross charges are not revenue. Without contractual adjustments posted, revenue and receivables are both wildly overstated — and the practice thinks it is owed money it will never collect.

Deposits that stop arriving. If daily EMR deposits disappear from the bank feed, treat it as urgent rather than a sync bug. Practices have lost significant sums to changed deposit account details going unnoticed for weeks. Chase a missing deposit stream immediately and in writing.

Payments never applied to invoices. A very common inherited problem: deposits recorded but never matched to the corresponding receivable, so AR climbs indefinitely and revenue is double-counted. Check the ageing against actual bank history before accepting the opening balances.

Contract physicians without W-9s. Practices that use locums and contract specialists can accumulate dozens of 1099-reportable relationships. Collect the W-9 before the first payment.

Receiving more patient data than you need. If a client sends a report full of patient names and diagnoses, that is now your problem to handle correctly. Specify the reports you want, in the format you want, at onboarding.