Short answer: a multi-entity healthcare group gets its month-end close from weeks to days by running every entity on the same calendar, the same chart of accounts and the same checklist; settling intercompany activity under written rules each month; reconciling bank, payroll and receivables accounts as the month goes rather than after it ends; and producing one consolidated package plus a P&L for each location. For one 12-entity healthcare group, we cut the monthly close from six weeks to ten days.
Below is why multi-location healthcare closes run long, what a faster close looks like, and when outside help makes sense. For how we work with providers, see our healthcare accounting page and our work with skilled nursing and assisted living operators.
Why does the month-end close take so long for multi-location healthcare groups?
Most groups grow one location or one acquisition at a time. Each new entity arrives with its own bank accounts, its own payroll setup and often its own way of coding expenses. By the time there are eight or twelve entities, the close is really eight or twelve separate closes plus a consolidation, done by a small team in sequence.
- Different charts of accounts by entity, so the consolidation needs a mapping exercise every month.
- Intercompany charges, such as shared staff, rent and management fees, that are booked on one side and not the other.
- Payroll spread across entities with allocations recalculated by hand.
- Receivables that don't tie between the practice or care management system and the general ledger.
- Everything waits on the slowest entity, because the consolidated numbers can't go out until the last one closes.
How do you shorten a multi-entity month-end close?
- One close calendar. Every entity closes on the same working-day schedule, with named owners for each step, so the work runs in parallel instead of in a line.
- One chart of accounts across all entities, with locations or classes for anything you report on. Consolidation becomes a report, not a project.
- Written intercompany rules. Decide how shared costs are charged, book both sides in the same entry, and confirm intercompany balances net to zero before you consolidate.
- Reconcile during the month. Bank, card and payroll clearing accounts reconciled weekly leave only the last few days for month-end.
- Tie receivables to the source system every month, so revenue and AR in the ledger match what the operating system reports.
- A standard reporting package: consolidated statements, a P&L for each location and a short list of the numbers leadership actually manages by.
What does a ten-day close make possible?
When the close takes six weeks, one month's results arrive after the next month is already over, so decisions about staffing, new locations and cash are made on history. A ten-day close puts each month in front of the owner while there is still time to act on it, and it makes lender, investor and buyer requests far easier to answer.
That was the situation for a healthcare group with twelve entities that needed six weeks to close after each month-end. We handled the accounting and reporting across all twelve entities, and the close went from six weeks to ten days. The full story is in our 12-entity healthcare case study.
When does it make sense to get outside help?
When the close is measured in weeks, when each acquisition adds another set of books to an already stretched team, or when owners are asking for location-level numbers the current process can't produce. River Edge Advisors has 75+ staff and works with healthcare groups nationwide, including home care, ABA and behavioral health, clinics and assisted living. We close every entity on a fixed calendar and deliver consolidated and location-level reporting. If you'd like a second set of eyes, we're happy to review last month's books for free.
Common questions
How long should a month-end close take for a multi-entity healthcare group?
Many well-run groups close in about ten working days or less. If yours takes several weeks, the cause is usually process: entities closed one after another, different charts of accounts and unsettled intercompany balances.
Should every location be its own entity with its own books?
Whether to form separate entities is a legal and tax decision for your advisors. The accounting rule is that every entity gets its own books, and every location you manage gets its own P&L, whether or not it is a separate entity.
How should intercompany charges be handled?
Write down how shared costs such as staff, rent and management fees are charged, book both sides of each charge in the same entry, and confirm that intercompany balances net to zero before consolidating.
What reports should a healthcare group get each month?
Consolidated financial statements, a P&L for each location, cash and receivables reports, and a short list of the operating numbers leadership manages by.
Does River Edge do medical billing or Medicaid cost reports?
No. River Edge handles accounting, the monthly close, reporting and fractional CFO work. Billing and cost reports stay with your billing team or specialist.