5 Tips for Community Health Centers to Transition to New Fund Accounting Software
The right fund accounting software can save you time and streamline your processes. But as a community health center, you’re already running on lean margins, which makes it even harder to carve out time to implement new software. That’s why it is vital to make sure your team is prepared for the change and ready to identify the improvements that will increase your community health center’s efficiency and accountability.
Here are five tips to help make your community health center’s fund accounting implementation smooth and seamless.
1. Identify the right skills on your team.
You don’t need a big staff to successfully implement new fund accounting software—you just need to be able to tap into the right skills on your team or know when to rely on an outside consultant.
You need data collection and data structure skills, not just a data entry person—someone who knows how your organization operates and the best ways for information to be delivered. You’ll also want someone who is familiar with compliance, especially GAAP and FASB. In a small, grant-funded organization, you might not have these skills and that’s ok! Working with a consultant (either your vendor’s or an external partner) will save time and money because the system will be set up for your organization’s exact needs.
2. Name a point of contact who sees the big picture.
Identify just one person to communicate with the software vendor. This person shouldn’t be the clerical or data entry person.
Your point of contact understands the importance of monitoring patient traffic trends, developing economies of scale, and identifying grants that will shore up revenue streams. The point of contact works with the software vendor to align the new system to your organization’s vision for the future, preventing your organization from flying blind. They’ll work together to ensure the system is configured to automate board reporting and UDS data so that you have more free time for other priorities.
3. Start now gathering the information you will need.
Assemble relevant accounts and data to highlight the processes you want to simplify and problems you want to solve with new software. It will help you envision the ease of an optimized structure for your chart of accounts and the business rules that will be most beneficial.
The most important document to have on hand is a trial balance report—with 36 months of history—from your legacy system. This enables the vendor to account for everything and map your history to a new and optimized chart of accounts. You’ll also want to keep a running list of everything from locations, services, and departments to bank accounts, credit card holders, users, and access levels. Spending additional time now compiling grant information will also help to maximize value from your new software. From the start, you want the system tracking the grants that fund multiple programs and to enjoy the ease of having all grant documentation in one electronic source.
4. Determine the non-financial metrics you want to track.
The ability to track and analyze non-financial metrics alongside your financials is what will really increase your community health center’s efficiency and ability to serve more patients.
For example, tracking patient encounters (total visits) and patients served (patients who are seen by a provider) by service line, provider, and payer streamlines UDS reporting. The benefit of tracking in your financial software is that you can determine revenue per visit and cost per visit, making it easy to identify business problems such as lagging locations or providers.
5. Think about the future.
Take this opportunity to simplify as many processes as you can. Would a monthly transmission of data from your EMR, payroll, or pharmacy system be easier than manual journal entries and spreadsheets? Ensure this is possible with your new accounting software and include this as part of your implementation scope.
In fact, ask about available API and customizations, including using Microsoft Power Platform, to make sure you are getting the most out of your new software.
And finally, don’t forget to keep scalability in mind with the chart of accounts design and document design decisions to ensure utilization and value continues well into the future.
Finding the Right Fund Accounting System for Your Community Health Center
The accounting needs of a community health center are complex, from managing grant funding to understanding historical location performance. Commercial accounting systems require workarounds to keep track of restricted funds and complete your reporting requirements. With a true fund accounting system, you get software that is built for nonprofit organizations so you can manage restricted funds within one system, which makes reporting simple.