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Health care organizations, like those in any other complex and highly regulated industry, are affected by risks and developments unique to the industry.   In addition, they are subject to a variety of very specific accounting principles and disclosure requirements.  This course will provide the participant with information to support their understanding of the entity and its environment, including risks specific to health care organizations.  The course will also discuss accounting and auditing issues specific to hospital systems, nursing homes and health plans.   Although the course is designed primarily to cover not-for-profit and investor owned health care entities, participants working for or with governmental health care organizations will also benefit from the course, even though GASB requirements will not be addressed.

Designed For
Practitioners who audit health care organizations (primarily) and CPAs in industry who wish to become familiar with accounting principles and disclosure issues. This course will cover third party reimbursement issues only as they relate to the audit of the financial statements and will not cover cost report preparation.

Objective

Participants will be able to:

• Understand and identify the risks inherent in the health care industry

• Identify and evaluate the most common significant risks in a health care organization

• Understand and evaluate specific accounting and auditing issues specific to not-for-profit and investor owned hospitals, nursing homes and physician practices.

Understanding the health care entity and its environment...   Financial Statements of Health Care Organizations…  Identifying significant systems of internal control…  Analytical procedures (preliminary and substantive)…  Clinical coding validations…  Statutory reporting considerations for health plans…  Risk based capital requirements…   Accounting and auditing of: Accounting estimates…  Revenue recognition…   Agency funds…  Investments…  Receivables…  State waiver contingencies…  Estimated final settlements…  Promises to give…   Premiums and stop loss insurance receivables…  Tax exempt entities…   Advance refundings…  Arbitrage liabilities…  Assets whose use is limited…  Medical malpractice and other professional liability issues…   The reporting entity…  Accounting and reporting for providers of prepaid health care services.

Presentation Method:  Lecture and group discussion

Level of Knowledge:  Intermediate

Prerequisites: Basic audit course

Recommended CPE Credit:  Accounting-3 hours and Auditing-5 hours

Field of Study: Accounting and Auditing

Advance Preparation:  None

Availability Date:  9/15/2008

Author(s):   Margaret Thomas, CPA, MHA

Qualifies for both 24 and 80 hour Yellow Book requirement.  Determination as to the qualification of certain courses for the Yellow Book 24 hour requirement should be made on an auditor specific basis depending on that auditor’s Yellow Book clients.  Note that the determination of course qualification is a matter of an auditor’s professional judgment in consultation with appropriate individuals in the audit firm.