As home health organizations navigate increasing regulatory demands, evolving reimbursement models and general operational complexity, the focus on financial reporting has become more than just a back-office function; it’s a key to success.
David Tomlinson, CPA, Senior Financial Reporting Analyst at Axxess, shared how the use of smarter, more flexible reporting tools can help home health leaders improve accuracy, streamline operations and plan confidently for the future.
Essential Reports for Leaders
Tomlinson outlines that home health organizations should regularly review the general ledger report package as it provides a full picture of revenue flow.
“I recommend the general ledger package because it contains all of the different reports that you can need,” said Tomlinson. “You can also run these reports separately.”
Tomlinson highlights several reports within the general ledger that would be beneficial to home health operations:
- AR Roll Forward Report – “This report details the state of your AR [accounts receivable],” Tomlinson said. “It lets you know if you are billing, adjusting and collecting accurately.”
- Month-End AR Report – “This report is useful because it showcases aging,” Tomlinson said.
- Payments and Adjustments Report – “This report showcases what payments you get, the adjustments you have and the reasons why,” Tomlinson said. “So, that would be a good way to identify LUPAs, or contractual adjustments. You can also reconcile EFT deposits with the amount of payments received.”
- Earned Revenue (1 Over X Daily Method) Report – “This is an accrual report that displays a daily proportion of total revenue for each day of a claim period,” he said.
- Managed Care Earned Revenue Report – “This report displays all of the revenue earned per visit for managed care.” Tomlinson added. “You can also see completed visits which have not yet been attached to a claim, AKA ‘unbound.’”
These reports are all traceable to the billing history, ensuring accuracy and transparency across the organization.
Tomlinson also highlighted the Unbilled AR Report, which helps organizations identify earned revenue that has not yet been billed. Regularly reviewing this report serves as an essential safeguard against timely filing issues.
Financial Reporting Pain Points and Common Mistakes
Home health organizations often face several recurring financial challenges, many of which stem from the complexity of managing accrual based accounting and maintaining visibility into their true financial position.
Tomlinson explains that one of the most common issues leaders face is the difficulty of actually understanding their accrual accounting without reliable, smart and flexible reporting tools.
“One pain point is understanding cash versus accrual,” Tomlinson said. “While cash accounting recognizes revenue and expenses when received and paid, our reports are based on accrual accounting, which means revenue and expenses are matched in the period they pertain to. So, basically you have revenue per visit and then the expenses of that visit all lined up. Getting a sense of what the accrual amount is can be very tricky without those previously mentioned reports.”
Tomlinson also noted that organizations often struggle to keep track of aging accounts receivable, making it hard to identify what has been outstanding for months and where collections are falling behind. Without clear insight into these areas, home health leaders lack the information they need to make informed decisions about revenue, expenses and payer performance.
“The other pain point is just getting a handle on your collections, knowing what’s been outstanding for months,” Tomlinson said. “Being able to put that together can be valuable.”
Beyond these pain points, many home health organizations make avoidable reporting mistakes that directly impact their bottom line. The most significant, Tomlinson outlines, is failing to bill for completed services, which can result in permanent revenue loss once claims exceed payer filing limits.
Other common missteps include missing rates on billable services and not analyzing profitability by payer category, issues that often arise because many leaders come from clinical backgrounds rather than finance. However, with the right reporting tools and guidance, organizations can avoid these issues and gain the financial clarity needed to ensure lasting operational success.
Financial Reporting for Strategic Planning
Consistent financial reporting helps home health organizations stay compliant and strengthens long term strategic planning. Establishing a regular reporting cadence gives leaders confidence in the accuracy of their financial data and ensures they’re making decisions based on a stable, reliable foundation. Tomlinson recommends leaders implement structured closing dates and locked reporting periods to ensure numbers remain accurate, protecting financial integrity.
Ultimately, financial reporting becomes a strategic tool when organizations use it to understand their true financial health and guide smarter decision making. Running reports consistently helps leaders spot unbilled claims, monitor adjustments and evaluate profitability across service lines and payer types.
“The first indications of the financial health of your organization are going to be in those financial reports,” Tomlinson said. “I would always advise checking on it, keeping it up to date.”
Axxess Home Health, a cloud-based home health software, empowers healthcare organizations with a suite of detailed financial reports, streamlining data collection and facilitating seamless financial operations.
