When it comes to the healthcare industry, one of the most important facets is payroll. Handling payroll in the healthcare industry can be a challenge. Some employees are salaried while others are hourly. Many employees are simply there on a temporary basis. Other employees might work at multiple sites. Some employees get overtime while others do not. Some employees get paid vacation while others do not. Therefore, it can be a challenge for companies and businesses to keep up with all the changes. With this in mind, it is important to know about some of the most common mistakes that healthcare companies make when it comes to payroll.
While there are numerous small business benefits that come with working in healthcare, there are also mistakes that are easy to make. These mistakes can lead to stiff fines and other penalties if they are overlooked. One of the most common mistakes is miscalculating overtime pay. Overtime pay is common in healthcare due to medical emergencies, sick days, and short staff. At the same time, it is still incumbent on the company to make sure all overtime pay is calculated and withheld appropriately. The employees who are eligible for overtime pay should receive it; however, it needs to be disbursed in an appropriate manner.
Another common mistake that healthcare systems make it forgetting to send out 1099s. Sure, most people who work for a hospital system are going to be W2 employees; however, not everyone will be. There are going to be some independent contractors who work with the hospital from time to time. These people need to be given their 1099s so they can report their taxes appropriately. If healthcare companies and hospitals fail to give out 1099s, this is a major red flag.
Finally, healthcare systems often leave too much in the hands of a software program. Payroll in the healthcare industry can be a challenge. For this reason, many hospitals try to save time and money by investing in a software program. This is fine; however, it is still important for someone to check behind the software program and make sure that everything is handled appropriately. If nobody is checking behind the program and a mistake is allowed to carry through the entire payroll for months on end, this can be an incredibly costly mistake. Therefore, someone still needs to be responsible for the software program.
These are a few of the most common payroll mistakes that take place in the healthcare system. It is critical for healthcare companies to invest in advanced payroll programs that are going to minimize these mistakes. Be sure to trust the trained prof