DIY accounting vs. healthcare accountant vs. Flychain

DIY accounting

Many new healthcare organizations struggle because they don’t hire an accountant or incorporate an effective accounting solution early on. Early successes are short-lived. As soon as they hit a bump in the road, require funding, or seek to expand operations, they lack the financial records and insights they need to grow.

Whether you take the DIY accounting approach, use a healthcare accounting software solution like Flychain or hire an accountant for your practice depends on your particular situation. Here’s how to decide which solution to use.

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What is DIY accounting?

While you can achieve accurate accounting with spreadsheets, most private practice owners use a DIY app like QuickBooks.

With DIY accounting software, it’s up to you to make sure all transactions are imported accurately into the ledger so you can generate financial and accounting reports. You'll use those financial reports to study your practice’s performance, strategize, and file accurate tax returns — so, accuracy matters.

How much does it cost?

Some healthcare accounting software is available for free, but for a comprehensive solution (one that isn’t limited by free plan limits), expect to pay anywhere from $15 to $45 per month. But remember, that monthly fee does not account for the cost of your time spent each week tackling healthcare accounting tasks and admin. Your time is valuable, so carefully consider the true cost of DIY before committing.

How does DIY accounting work?

Most accounting software automatically imports transactions from your business bank account to the general ledger, the main document tracking all expenses and revenue. Then it’s up to you to categorize each transaction and ensure it’s accurate. 

Sound simple? Sure, but remember that healthcare accounting tasks like these are not to be taken lightly. Miscategorizing a transaction—labeling an operating expense as part of your cost of goods sold (COGS), for instance—results in inaccurate financial statements and, eventually, inaccurate financial projections and tax filings. That can be a big headache down the road.

With all DIY healthcare accounting methods and software, the responsibility for accurate bookkeeping and accounting ultimately lands on your shoulders.

What are the benefits of DIY accounting?

• Relatively inexpensive. So long as you don’t make any costly mistakes, accounting software is cheaper than fees associated with hiring a professional with previous accounting experience.
• Hands-on learning. If you want to gain experience in accounting about learn how it works for your business, software gives you the chance to learn more by doing.
• Upgradeability. So long as your books are accurate, you’re typically able to pass on your DIY, software-based accounting info to a professional accountant once you’re ready to make the upgrade.

What are the drawbacks of DIY accounting?

• Time cost. As a business owner, every minute of your time has the potential to be invested in expanding your business. Since you probably lack specific experience in accounting, DIY accounting can disproportionately eat into your time.
• Errors are expensive. Miscategorizing a transaction or losing track of records can have a serious impact once it’s time to file taxes.
• Upgrade costs. While most accountants will accept past accounting data from your software, they typically charge a fee to go back and retroactively make sure everything is accurate. That fee increases if your books are disorganized or include errors.
• It all rides on you. It’s up to you to make sure your accounting is accurate—there’s no outside help to draw on. Many business owners find that responsibility creates unnecessary stress — especially when healthcare accounting professionals can shoulder that burden for you.

Who is DIY accounting best for?

If your healthcare practice is brand new and you’re just beginning to earn revenue, software gives you the tools to keep track of your finances and eventually upgrade to a professional solution. Hiring healthcare accounting professionals might be out of budget in early days, so it's an understandable solution for many healthcare providers.

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Healthcare Accountant

What is a healthcare accountant?

A healthcare accountant is a professional trained in bookkeeping (tracking day-to-day transactions) and accounting (generating financial reports, creating financial projections, and providing tax planning services) who typically has some experience working with healthcare practices and medical facilities.

How much does it cost?

A typical fee for a professional in the field of healthcare accounting is roughly around $40 per hour. Note that costs can absolutely exceed $40 when hiring an accountant or accounting practice highly experienced in healthcare practices, medical facilities, and medical terminology.

The total cost per month depends on which services you need, and how complex your bookkeeping and accounting are. If you hire an accountant solely to prepare your tax return, expect to pay a one-time fee of $375 to $500.

How does hiring a healthcare accountant work?

Your accountant may be a freelancer or an employee at a firm. They may handle both your bookkeeping and your accounting, or only your accounting. In the latter case, expect to hire a separate bookkeeper who will keep your books up to date and deliver your financial information directly to your accountant.

Most accountants and bookkeepers use commercially available accounting software. To submit transactions or import information (like retroactive bookkeeping information) for the benefit of your accountant, you may need to use the same software. That will mean signing up and possibly paying for the software, as well as learning how to use it.

Bookkeepers typically import your transactions directly from your bank accounts, and accountants take that information from bookkeepers and use it to generate financial statements and file taxes. An accounting firm may also offer payroll services if you have employees.

What are the benefits of hiring a healthcare accountant?

• Protection from errors. A certified accountant with experience in medical organizations will ensure your financial information is correct and help you file accurate tax returns.
• Projections, planning, and advice. Accountants can provide accurate records and insight into your healthcare practice and challenges it faces that you would not be able to access on your own. That’s good for long-term planning and growth.
• Less time cost. With one or more professionals handling all your bookkeeping and accounting, you have more time to invest in your practice.
• The information you need. Accurate and up-to-date financial reports guarantee you have the information you need to make smart financial decisions and file your taxes accurately. 

What are the drawbacks of hiring a healthcare accountant?

• Potential for communication errors. While most professionals in the field of healthcare accounting are qualified to handle your finances, they don’t always excel at communication. When you rely on one individual to handle all your financial information, they may become a bottleneck if they’re hard to reach. On top of that, it's not unusual for accountants from a firm to switch jobs semi-frequently. That could mean having to onboard a new accountant more often than you'd like.
• Inflexible reporting schedules. Monthly financial reports give you the insights you need to understand your business broadly, but if you want up-to-the-minute information, you may have trouble accessing it. Most traditional accountants don’t offer a dashboard with real-time financial metrics.
• Multiple freelancers. Your accountant may not offer bookkeeping services, and your bookkeeper may not be qualified to handle your accounting tasks. That could mean a lot of running around coordinating between different individuals.

Who is a healthcare accountant best for?

A medical accountant is essential for any practice that wants a professional solution for their financial services and freedom from the burden of hands-on, DIY accounting. For a one-stop solution with real-time financial insights, consider a cloud-based solution like Flychain.

Flychain

What is Flychain?

Flychain is a complete financial operating system for healthcare providers. That includes a full-service healthcare accounting, access to capital, valuation services, and more. When you have Flychain handling your accounting, all your transactions are automatically imported, and a team of in-house accountants categorizes them for you. 

You access Flychain from a dashboard featuring real time financial metrics. Besides typical financial reports, you can access tools to help you plan and scale your practice.

Flychain is specifically designed for healthcare businesses. Using Flychain, you can access financing options that give your business more access to working capital.

How much does it cost?

Flychain pricing entirely depends on the scope and scale of your business. For pricing details, book a call with us today!

How does Flychain accounting work?

Every time your business spends or earns money, the transaction is automatically imported and categorized in your general ledger. That information is used to generate real-time financial reports and metrics in your Flychain dashboard.

What are the benefits of Flychain accounting?

• A healthcare-specific solution. Flychain gives your practice healthcare-specific financial tools—backed by a team of accounting professionals—you won’t find anywhere else.
• Virtually hands-free accounting. Transaction categorization and reports are handled by  professionals versed in accounting principles who ensure their accuracy.
• More time, less stress. You put less time and energy into accounting, so you have more to invest in your business.
• Information you can act on. Real time metrics like cash flow give you advanced billing cycle information most accountants can’t provide.

What are the drawbacks of Flychain?

• Not for early, early stage providers. If you still haven’t launched your practice, it’s too early to start using Flychain. Once you’re ready to open your doors to patients, Flychain is the fastest way to get your finances up and running.

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DIY Healthcare Accounting: Frequently Asked Questions

What are the pros and cons of DIY accounting for a healthcare practice?

DIY accounting for a healthcare practice is lowest in out-of-pocket cost but highest in hidden cost - including the owner's time spent on bookkeeping tasks, the risk of misclassification errors specific to healthcare revenue, and the absence of strategic insight that a dedicated accounting team would provide.

General accounting software typically costs $15 to $45 per month for a basic plan, but the absence of payer-level categorization, industry benchmarks, and healthcare expertise means the reports it generates often can't answer the questions that actually matter for running a practice.

When should a healthcare practice switch from self-managed accounting to a professional solution?

The right time to switch is when DIY accounting is consuming meaningful owner or staff time, when you can no longer answer basic financial questions without significant effort, when you have multiple payers and payroll is complex, or when you're planning to access financing or consider a future sale. Most practices that are billing more than $500,000 annually and have insurance payers will see a clear return on professional healthcare accounting; both in time savings and in improved financial outcomes driven by better data.

How does hiring a healthcare accountant compare to using a platform like Flychain?

A traditional healthcare accountant typically handles tax filing and may provide some strategic guidance, but may not include day-to-day bookkeeping, real-time financial dashboards, benchmarking, capital access, or the integrated view that comes from having all financial functions on one platform.

A typical healthcare accountant charges around $40 per hour for accounting work, with tax preparation adding $375 to $500 or more per year. Flychain consolidates bookkeeping, CFO intelligence, tax strategy and filing, and capital access in a single platform at a predictable monthly price.

What does a complete financial operating system for healthcare practices include?

A complete financial operating system for a healthcare practice includes accurate monthly bookkeeping with payer-level categorization, CFO-grade analytics for performance benchmarking and strategic decision-making, proactive tax planning and full-service filing, and capital access for both working capital and growth financing.

Flychain is purpose-built to deliver all four of these capabilities in one integrated platform, so every piece of your financial management is connected and working from the same data rather than fragmented across separate vendors.

What is the true cost of DIY healthcare accounting when you factor in your time?

Healthcare practice owners who manage their own accounting typically spend 10 to 20 hours per month on bookkeeping, financial reporting, tax preparation, and related tasks. At even a modest valuation of the owner's time, that represents $2,000 to $5,000 or more per month in opportunity cost - time that could be invested in patient care, practice development, or personal time. When you add the cost of errors, missed deductions, and decisions made on incomplete data, the true cost of DIY accounting in healthcare is almost always higher than professional alternatives.

How does Flychain pricing compare to piecing together separate financial services?

When a practice pieces together a separate bookkeeper, CPA, fractional CFO, and loan broker, the individual costs add up quickly and none of those vendors share data or coordinate their work.

Flychain consolidates all of these services at a predictable monthly price that scales with the size of your practice. Clients save an average of $25,000 per year per location by eliminating redundant vendor fees, recovering missed tax savings, and improving capital access - savings that typically exceed the platform cost by a significant margin.

What are the best practices for a new healthcare practice choosing its first accounting solution?

New practices benefit most from starting with a healthcare-specific solution from day one, rather than setting up a generic accounting tool and migrating later.

Choosing a platform that includes bookkeeping, tax planning, and financial reporting together eliminates gaps between vendors and ensures your entity structure, chart of accounts, and bookkeeping practices are set up correctly for healthcare from the beginning. Clean books established at the start of a practice are significantly less expensive to maintain than books that need to be corrected after years of misclassification.

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Next Steps

Evaluate your accounting needs and consider whether DIY solutions, professional accountants, or an all-in-one platform like Flychain will best support your practice’s financial health and growth. Make the switch when you’re ready for seamless, accurate, and efficient financial management.

Thank you for following our Healthcare Accounting Series. Stay tuned for more insights and updates on optimizing the financial health of your practice!