Bookkeeping for Tri-Cities dental and medical clinics

A Coquitlam clinic's books work when each payer is reconciled on its own, associate payments are rebuilt from the production report every month, and revenue is coded by GST status before anyone files anything. Get those three right and the rest of the bookkeeping is the ordinary kind.

This entry is for owners and practice managers of dental offices, family practices and allied health clinics around Coquitlam Centre, along Austin Avenue in Austin Heights, and in the newer buildings near Burquitlam station. It covers the bookkeeping. Associate agreements, worker status and tax structure belong to your CPA and your lawyer, and we say so where it comes up.

Why does a clinic need a separate reconciliation for each payer?

Because each payer pays on its own schedule, in its own format, and a single bank reconciliation hides which one is short. A clinic deposit might be MSP, a private insurer, Sun Life for a Canadian Dental Care Plan patient, a card batch from the front desk, or an e-transfer from a patient settling a balance.

Treat each stream as its own small ledger:

• MSP: expected payments by remittance, then actual deposits
• Sun Life (CDCP): claims submitted, amounts paid, amounts adjusted
• Private insurers: the same, one line per insurer that pays you directly
• Patients: what the front desk charged, what was collected, what is still owing
• Card processor: daily batches against the day sheet from your practice software

When each of those reconciles, the bank account reconciles almost by itself. When one doesn't, you know exactly which file to open.

How do you reconcile MSP payments?

You match each deposit to its remittance statement, not to what was billed. MSP pays practitioner claims in the middle and at the end of each month, and claims have to be in through Teleplan by the semi-monthly close-off date to be processed on the next remittance (MSP Designated Holidays and Close-Off Dates). The province posts the close-off, remittance and payment dates for each year on that page, which makes it the calendar to build the close around.

The remittance statement lists the total gross and net amounts billed and paid for each payment, plus adjustments such as interest (MSP Billing and Payments). That is the document we book from:

1. Record the gross amount paid as revenue for the physician or payment number concerned.
2. Book adjustments on their own lines so they don't quietly shrink fee revenue.
3. Match the net to the deposit.
4. Carry refused or reduced claims to a short follow-up list with their explanatory codes. MSP can reject, reduce or refuse a claim, and the code says why (MSP Claim Submission & Payment).

Group practices add one wrinkle. A clinic or group normally has a single payment number, and a practitioner can assign payment to it for up to five years. Claims submitted before that assignment is processed are refused. When a new physician joins, we watch the first remittances closely so a refusal is caught as a set-up problem rather than written off.

How should a dental office book CDCP and private insurer payments?

Keep a receivable for each payer, with Sun Life separate from the rest. Under the Canadian Dental Care Plan, providers bill Sun Life directly, claims must be submitted with assignment of benefits, and the patient pays only any outstanding amount the plan doesn't cover (CDCP: information for oral health providers). That makes Sun Life a payer you are waiting on, much like MSP for a medical clinic.

In practice:

• The day sheet splits each visit into the payer's share and the patient's share.
• The payer's share sits in a receivable for that payer until the deposit arrives.
• When the payment lands, it is matched claim by claim to the payer's statement.
• Any difference becomes either a patient balance or a claim to resubmit. It is never written off silently.

Private insurers that pay the office directly get the same treatment, one receivable each. Where patients pay first and claim themselves, the money is simply a patient payment and there is nothing to chase.

A month-end aged list by payer is the most useful report a dental office can have. It shows at a glance whether a slow month was slow chairs or slow insurers.

How do you record and check associate payments?

You book each associate payment from a calculation you can show, not from the amount someone typed into online banking. Associates are commonly paid a share of what they produce or collect, less deductions their agreement sets out, such as lab fees. Each month we rebuild that number:

• Production or collections for the associate, from the practice-management report
• The percentage in the signed agreement
• Each deduction the agreement allows, with its source (lab invoices, for example)
• The resulting amount, compared with what was actually paid

Say an associate's agreement pays 40 percent of collections and splits lab fees evenly. Collections for the month were $20,000 and lab fees $1,000, so the payment should be $8,000 less $500, or $7,500. The bookkeeping question isn't whether 40 percent is fair. It's whether the payment matches what the contract says. A clerical slip of one percentage point, repeated for a year, is real money for one side or the other.

Three calls sit with the CPA, not us:

• Employee or self-employed. CRA looks at the overall relationship, and the answer decides whether CPP, EI and income tax are withheld at source (Determine the relationship with the employer or the payer). The same page notes that work done through the worker's own corporation raises its own questions. We set the books up to match the CPA's answer.
• GST on associate and cost-sharing fees. Whether a fee between an associate's corporation and the clinic company is taxable depends on what is actually being supplied. We code the fees clearly on both sides and leave the treatment to the CPA.
• The agreement itself. Percentages, deductions and termination terms are for your lawyer and the associate's.

If the associate practises through a health profession corporation, that corporation gets its own books, and the fees between it and the clinic are recorded on both sides and reconciled monthly.

Is GST charged on medical and dental services?

Mostly no. CRA lists most health, medical and dental services performed by licensed physicians or dentists for medical reasons as exempt, and exempt supplies carry no GST (CRA, Type of supply). The same page says that when you make exempt supplies, you generally can't claim input tax credits for the GST you paid. For a typical clinic, GST on rent, supplies and equipment is a cost, not a refund.

The exemption has edges, and they show up in the revenue coding:

• Purpose matters. For many health professions, a service is exempt only if it is a qualifying health care supply, made mainly to maintain health, prevent or treat illness or injury, help someone cope with a disorder or disability, or provide palliative care (CRA P-256).
• Cosmetic work is excluded. Cosmetic services not done for medical or reconstructive purposes fall outside the exemption under the same policy.
• Third-party paperwork is usually taxable. Examinations, reports and certificates made only for an insurer, an employer or a legal matter, such as an insurer's eligibility review or an immigration medical, generally carry GST.

Small amounts of taxable revenue can add up. A business must register for GST once its taxable revenue passes $30,000 within one calendar quarter, or across the last four calendar quarters taken together (CRA, When to register). A clinic with a growing cosmetic line or a steady stream of insurance forms should be tracking that total, and we report it each month.

What we do is code each revenue type to its own account: insured services, patient-paid care, cosmetic procedures, forms and reports. Your CPA confirms which lines are exempt and whether registration is needed, and our GST and PST filing service files on that basis.

What happens at month-end in a Tri-Cities clinic?

A fixed checklist, finished by the 10th:

1. Day sheets from the practice software tied to card batches and cash.
2. MSP remittances matched to deposits, with refusals listed by explanatory code.
3. Sun Life and private insurer payments matched claim by claim; payer receivables aged.
4. Associate payments recalculated and compared with what was paid.
5. Payroll for hygienists, assistants, MOAs and reception run and remitted through our payroll management service.
6. Lab, supply and equipment-lease invoices captured and coded.
7. Fees between the clinic company and any professional corporation reconciled on both sides.
8. Statements, revenue by provider and payer, and a short written note delivered.

That routine is our monthly bookkeeping service, adjusted for clinics. We work from reports, not charts: day sheets, production by provider and receivables by payer. We never need clinical records.

When does a clinic need more than a bookkeeper?

Usually when it opens a second location, takes on a partner, or starts asking which chairs and which providers actually earn their keep. At that point someone has to own budgets, provider-level margins and cash planning, which is the work of a fractional controller.

Before that, the clearest gain is a clean year-end. A file where every payer reconciles and every associate payment ties out is quick for the CPA to finish; our year-end checklist for Tri-Cities owner-operators lists what they will ask for. For the wider routine across agents, restaurants and clinics, start with the Coquitlam owner-operator's guide to bookkeeping. If you run a café beside the clinic, our note on restaurant daily sales and tips covers that side of the street. For what a clinic file costs, see bookkeeping costs in Coquitlam for 2026.