Are You Prepared for the Accounting Side of Value Based Purchasing?
I have a feeling the majority of us are focused on outcomes of care. Value based purchasing focuses on results. The results are defined as to what will be delivered. Payment is then based on the results. Have you thought about your accounting system and processes?
I just came upon an interesting blog post and interview focused on the accounting side of value based purchasing. Typically in rehabilitation, payments may initially be the typical fee for service. Then, after a defined amount of time, money is either taken back or additional payment is sent to the provider based on the results.
The normal process for payments is for the incoming payment to be recorded in the electronic medical record and also in the business accounting system. This particular blog post caught my attention because it focused on the accounting side of things. In value based purchasing, the business may be paid additional revenue for meeting factors determined within a quality focused contract. If the factors are not met, the business will have an expense due to quality not being met.
In December 2017, revenue-recognition rules are in effect. It seems these rules are mainly for publicly traded companies/organizations with debt. Even if the revenue-recognition rules do not apply to your organization, time will need to be taken to determine accounting processes for your organization.
If you are interested in the blog post that caught my eye, you can find it here.