Patient Payments are not a Spending Account

It’s a common scenario: a team member needs to run out and grab paper for the printer or supplies for the front desk. They open the drawer, see cash from that morning’s patients, and think, “Let’s just use this—it’s easier than using the card or waiting for approval.”

The intention may be harmless, but the impact is not. Using patient payments—cash receivables—for purchases, no matter how small, introduces gaps in your records, weakens internal controls, and exposes the clinic to financial and compliance risks. Revenue is revenue, and once it enters the practice, it must follow a proper accounting path.

❌Using Patient Payments for Purchases Disrupts Everything

Cash collected from patients is income. It must be deposited in full into the clinic’s business bank account. Using it for purchases—no matter how small—compromises the accuracy and integrity of your bookkeeping.

Here’s what’s at risk:

• Your financial reports won’t reflect the full picture. Undeposited cash means underreported revenue and distorted expenses.
• You break the link between your PMS and your bank. Payments marked as “received” don’t appear in your deposits, making reconciliation difficult or inaccurate.
• You lose visibility. Untracked spending increases the risk of errors, misuse, or even fraud.

All Clinic Expenses Should Go Through the Business Credit Card

The cleanest, safest, and most efficient way to pay for anything clinic-related is by using your business credit card. This applies to all purchases—office supplies, subscriptions, equipment, even lunch for the team.

Why this works:

• Every transaction is documented, with a vendor name, amount, and date.
• Statements are easily reconciled each month.
• Your financial reports remain accurate and complete.
• You maintain clear separation between income and spending.
• You avoid the risks of untraceable or unauthorized purchases.**

🔁What About Making Change for Patients Who Pay in Cash?

In cases where your clinic accepts patient payments in cash, it’s appropriate to maintain a cash float—a small, fixed amount of money kept at the front desk for the sole purpose of providing change.

Important: This cash float is not a backup spending fund. It should only be used to make change for patients—and never to purchase items for the clinic.

If the float runs low, it should be replenished through a documented cash withdrawal from the business account—not from daily patient collections.

✅Moving Forward: Simple Rules to Follow

• Deposit all patient payments—in full and without exception—into the clinic’s bank account weekly and on the last business day of the month
• Use the clinic’s business credit card for all clinic-related purchases.
• Maintain a small cash float for change only, not for spending.
• Avoid handling expenses in cash. It creates complications, not convenience.

Even small lapses in financial procedure can create big problems. Patient payments are not a flexible fund—they are business income. Keeping your clinic’s income and expenses fully traceable is not just best practice—it’s a non-negotiable standard.

Maintaining strong internal controls builds trust, ensures accurate reporting, and protects the long-term health of your practice. If your current systems make it hard to follow these steps, it’s worth taking time to tighten them up. You don’t need complexity—you just need consistency.

Let us know if you'd like help reviewing your clinic’s current setup or want to clarify your expense protocols with your team.