A medical practice earns revenue at the moment of care but collects it in pieces: a copay at the front desk, an insurance remittance weeks later, sometimes a patient balance months after that. Practice-management software tracks charges, while the bank only sees deposits. Bookkeeping for a practice is the work of connecting those two worlds without losing the detail in between.

Charges, collections and adjustments

Billed charges are not revenue you will receive. The difference between the charge and what a payer allows under its contract is a contractual adjustment, and it should be recorded as such rather than as bad debt. True bad debt is a patient balance you tried to collect and could not. Keeping these separate is what lets you see collection performance honestly.

Reconciling remittances to deposits

Insurance payments typically arrive as electronic transfers supported by a remittance advice listing many claims. We match each transfer to its remittance, post patient card payments by batch, and tie the month's collections in your practice-management system to the bank. Unmatched deposits usually turn out to be recoupments, interest or a payer sending one transfer for several remittances.

Assets, leases and recordkeeping

Diagnostic equipment, furniture and software are often the largest purchases a practice makes. The IRS explains how business property is depreciated in Publication 946, and its recordkeeping guidance describes the supporting documents to keep. We maintain a fixed asset list with purchase dates and costs so your tax preparer has what they need.

What our medical practice support covers

  • Monthly reconciliation of insurance, patient and card receipts
  • Separate tracking of contractual adjustments, refunds and bad debt
  • Provider and staff payroll records
  • Monthly financial statements and a year-end package

We do not access clinical records; we work from financial reports and remittance summaries. See our bookkeeping services or book a consultation.

Key terms

Terms that come up often in medical practices bookkeeping:

  • Assets: Assets are resources a business owns or controls that are expected to provide future economic benefit.