IRS regulations usually come with a lengthy list of things for hospital executives to accomplish. Whether it’s establishing written policies or putting together a reporting process, healthcare professionals have a lot to keep up with when it comes to IRS 501(r) guidelines.
Staying organized while adhering to IRS 501(r) compliance requirements is critical if hospitals want to maintain their tax-exempt status. Failure to comply with even one of the requirements can result in a hospital losing its 501(c)(3) status.
Fortunately, every hospital can maintain its tax-exempt status by following the IRS 501(r) compliance requirements and focusing their organization efforts around those guidelines. Hospitals can achieve this through cloud-based technology and diligent processes.
How Organization Improves IRS 501(r) Compliance
When it comes to ensuring a hospital is meeting all of the IRS 501(r) compliance requirements, organization is an effective way to keep track of internal duties and responsibilities. Getting and staying organized may not be at the top of any professional’s to-do list, but it can ensure a hospital facility meets important deadlines and performs all required tasks.
If a hospital is serious about creating a compliant environment, workspace and digital organization can improve a hospital’s IRS 501(r) compliance requirements by:
- Improving workflow efficiency: Whether organizing a corner desk or a cloud-based desktop, having an organized workspace makes it easier to access frequently used files, software, and systems.
- Reducing errors: Being organized means hospital executives are less likely to create small mistakes that can lead to losing their 501(c)(3) tax-exempt status – or put patient information at risk.
- Increasing attention to detail: The fine points of IRS regulations are where many organizations have trouble, but organization makes it easier to focus on critical details.
- Creating crucial processes: For digital organization, hospitals can create automated systems that make IRS 501(r) compliance more intuitive and less prone to risk.
While it isn’t a new concept, organization gives healthcare professionals the mental and physical space to perform their jobs. When they have quick access to their productivity tools and a workspace that is free of clutter, hospital executives can get their jobs done with less stress and without losing important documents.
Organization and cloud-based workflow solutions are also critical to staying in compliance with HIPAA regulations. The right technology can reduce paperwork and make it easier for patients to apply for secure medical financing.
How to Get Organized While Following the IRS 501(r) Compliance Requirements
IRS 501(r) compliance requirements have a lot of fine points for hospitals to follow. Every hospital facility should have a streamlined approach to organization if it wants to cover all of the details.
1. Create an IRS 501(r) Compliance Checklist
The minute details of IRS Section 501(r) can create problems for hospitals that aren’t organized. An IRS 501(r) compliance checklist can ensure each requirement is met. The checklist should be as comprehensive as possible and include things like:
- What policies need to be written or revised to comply with IRS requirements
- When reports and tax documents are both available from and due to the IRS
- How the hospital plans to approach the three-year Community Health Needs Assessment requirements
Once the checklist is complete, a timeline should be constructed to approach each of the checklist components.
2. Set Up a Calendar for Reporting Documents and Deadlines
Every hospital – like any business – is required to submit annual reports and tax documents to the IRS. To get organized and set the hospital up for success, a calendar should be completed that includes deadlines for anything that needs to be submitted, like:
- Audited financial statements to the IRS every year
- Form 990 with all community involvement for the taxable year
- Community Health Needs Assessment progress updates based on the previous assessment’s results
While a desk or wall calendar can be a practical place to write these dates, a web-based calendar will offer the ability to set up reminders for the deadlines.
3. Schedule a Plan for Reviewing Written Policies
Whether a hospital is creating their first written policies for IRS Section 501(r) or it is just reviewing the policies for compliance reasons, every hospital should have a plan for when and how often it will review those policies. Policies that routinely need to be reviewed are:
- Financial Assistance Policy
- Emergency Medical Care Policy
- Billing and Collections Policy
Each of these policies is comprehensive and has its own set of requirements, which is why hospitals should put together the compliance checklist before scheduling their plans.
Tips for Staying Organized While Adhering to the IRS 501(r) Compliance Requirements
Organization is just the first step to ensuring a hospital is properly adhering to IRS 501(r) compliance requirements. Once a hospital gets organized, the trick is staying organized while dealing with the day-to-day activities of financial assistance.
Hospitals that want to stay organized while adhering to IRS Section 501(r) requirements should:
- Create digital reminders: Either a reminder on a mobile device or a web-based reminder that pops up on a laptop, digital reminders will help keep hospitals on task by making sure the right people get the job done on time.
- Use technology to automate processes: Cloud-based technology, like medical billing software, can streamline processes and reduce the errors associated with manual data entry while also speeding up the time it takes for hospitals to get paid.
- Delegate tasks to other professionals: Consider hiring a tax professional to outline how the IRS 501(r) requirements impact the hospital. A tax professional can ensure hospitals are following the most recent guidelines.
Every hospital executive and healthcare professional has a different method for staying organized, but hospitals should have policies and procedures in place that ensure all aspects of the 501(r) requirements are addressed.
How Technology Can Help Hospitals Stay Organized
Technology is one of the most effective ways for hospitals to get and stay organized while following IRS 501(r) compliance requirements. Medical billing software, like Charity Care Management Software, can increase a hospital’s capacity to organize data while providing a premier patient experience.
Charity Care Management Software offers critical benefits that can help hospitals manage HIPAA and IRS requirements, like:
- Enabling patients to submit web-based applications at their convenience.
- Providing quick decision-making capabilities to hospital administrators.
- Consolidating information to make end-of-year reporting more efficient.
This will not only save time but reduce the amount of paperwork hospitals deal with every year, making Charity Care Management Software a practical solution.