By Guest Author Yohannes Zewudie with Yohannes Tax & Accounting

The Oregon Department of Human Services identifies adult foster care home licensees as independent business owners. Owners, who are responsible for Adult Foster Home (AFH) businesses are usually expected to wear so many hats to discharge their responsibilities and achieve their company’s vision. Trust and relationships created with owner(s), customers, employees, government (federal & state) agencies and the society determine the success of businesses.
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Small businesses, including adult foster homes, deserve the opportunity to be successful in their line of business. Regardless of the business size, accounting as a profession plays a significant role in creating a conducive environment for success. It is with this in mind that I argue small businesses should consider having an accountant if not a certified public accountant (CPA) to achieve their ultimate goal. 

1. Effective and Efficient Business Management

​Businesses need historical, current and projected financial information to make the right decision in their business. Without complete and accurate financial recordkeeping and reporting, a small business owner cannot say for sure the true profitability of his/her business. Small businesses that tend to measure their profitability and success based on available cash flow or bank balance are only looking at one criterion. Business owners who rely on incomplete or wrong information usually make decisions that impact their business negatively.  
 
Accounting, as a support function to owners, is tasked with recording business financial data, analyzing them and generating timely and reliable financial reports to show the true picture of business status and profitability. It is for this reason that small businesses need accountant who can assist them in running and evaluating their business.  

2. Peace of Mind

In the ever increasing federal and state regulatory environment, small businesses are required to comply with various tax laws and regulations. Among other, businesses including AFHs have to report:  

• Federal Payroll & Income Taxes
  • Social Security and Medicare Taxes (FICA taxes)
  • Federal Unemployment Insurance Taxes (FUTA)
  • Federal Income Taxes
• State Payroll & Income Taxes
  • State Payroll Taxes
  • Transit taxes (Tri-County Metropolitan Transit District (TriMet) and Lane Transit District (LTD)
  • Employment Taxes (State Unemployment Insurance or SUTA):
  • Workers’ Benefit Fund Assessment (WBF)
  • Workers’ Compensation Insurance
• Local and City taxes
• Periodic Payroll Reporting
• W-2, W-3, 1099 and other annual reporting

​Many AFHs are not well-equipped to meet these and other regulatory and compliance requirements. Having an accountant who properly handles these mandatory compliance requirements gives AFH owners peace of mind for them to focus on other important business matters. 

3. Ease of  Annual Business and Personal Income Tax Reporting

The United State Internal Revenue Service (IRS) and the State of Oregon expect taxpayers to:

• File a timely return;
• Make accurate reporting; and
• Pay the required tax amount by the due date. 

Small businesses and their owners face challenges in compiling the necessary business records during tax season. Without a good recordkeeping and tracking method, it is daunting for small businesses to fully meet the tax reporting requirement.

Lack of proper accounting system could result in understated business income and/or deductions that may result in higher taxes, interest and penalties.  If the owner or business deliberately attempt to evade taxes or willfully fails to file or pay taxes, they could be subjected to criminal tax fraud cases.
 
AFH owners can ease the stress associated to tax return filing by hiring an accountant who:

• Maintains proper financial recordkeeping throughout the year;
• Maintains proper classification of taxable income and non-taxable income;
• Claims all available and qualifying business deductions;
• Files annual & quarterly tax returns in a timely manner; and
• Pays timely quarterly estimated payments.

4. Utilize Available Business and Financing Opportunities

More than large and medium businesses, small businesses tend to miss out on available business and financing opportunities due to lack of information or poor financial recordkeeping. The missed opportunity to utilize the Small Business Administration Paycheck Protection Program (PPP) is a very good example. Significant number of small businesses failed to utilize federally available PPP. An accountant comes handy to assist small businesses to have the necessary records and enable them seize these available business and financing opportunities.

5. Quality of Life

AFH owners assume so many duties and responsibilities (manager, receptionist, purchaser, accountant, janitor and many others) in a single day to be successful. Since AFH owners are not expected to be knowledgeable or proficient in every task, they might have to work more than 12 hours a day to accomplish all these tasks. These business burdens make the owners unhappy and inefficient. The opportunity cost of spending too much time at work may also negatively impact their health, family dynamics and other social life.
 
An accountant can shoulder one burden and perform the accounting-related duties in the right way. Delegating the accounting tasks to the right professional would result in the following:

• Improved quality of work.
• Standardized financial reporting.
• Reduced owner work-related stress.
• Increased owner productivity and job satisfaction
• Potential long term cost reduction.

6. Financial Consultation

​Based on available company financial data and their business environment, a certified public accountant can provide knowledge-based financial consultation to AFH businesses. These consultations could have a significant impact on tax savings and business growth.

7. Representation in Federal and State Audits

In case of federal or state audits, a CPA can represent an AFH to handle their audit. Unlike an accountant, which is limited to the return prepared by him/her, a CPA can represent any business in federal or state audits. 

"While all CPAs are accountants, not all accountants are CPAs”. A CPA is an accountant that passed the rigorous testing and strict licensing requirement to practice in the state. CPAs are expected to abide by the code of ethics and must update themselves by taking the required continuing educations every year.

​The benefits listed above are not an exhaustive list as to why adult foster care homes need an accountant, if not a CPA. It is always advisable for small businesses to reach out to professionals and seek advice on how they can achieve their ultimate business goals.

Article by Alyssa Elting McGuire, MA, MPA

Most hospitals and skilled nursing facilities adopted electronic medical records years ago. Now, larger community-based facilities, such as assisted living and residential care, are slowly adopting electronic health records; however, the adult care home industry has yet to jump on the electronic records bandwagon.

This lag in adoption is likely due to several factors. Adopting electronic records can be more challenging for adult care home providers without electronic record experience who may initially believe they lack the money, staffing, and infrastructure to implement this change. Fortunately, these potential barriers are not insurmountable.

As larger facilities migrate to electronic record-keeping, it is simply a matter of time before more and more providers in Oregon start implementing electronic record-keeping systems in their adult care homes.
One trailblazer in the area of electronic record use in adult care homes is Shannon Carskadon. Shannon owns and operates Silver Cloud Adult Family Homes in Forest Grove and has been in the business for 25 years. I recently had the opportunity to sit down with Shannon to talk about her experience transitioning to an electronic records system earlier this year.

The system Shannon uses is supported through Beaverton-based company Care Facility Management Systems that works with individual adult care home providers to “cost-effectively transition their business operations from paper to electronic records.” Owners Gueipin Xi and Elaine Hartman bring over twenty years of experience providing technical support and security to health care clients.

Interview with provider Shannon Carskadon (Interview has been edited for brevity and clarity)

Have you used electronic records for your homes before?
I used Excel files, which I printed out for licensing, but I had no system set up.

What made you decide to transition to electronic records?
There were current issues [with the hard copy records]. At licensing inspections, the books would be torn apart and nothing got put back correctly. There was too much repetition and similar mistakes. There was a huge potential for medication errors.
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Elaine [with Care Facility Management Systems, LLC] called me and asked if I’d be interested in helping build this program for use in other adult foster homes. The company takes care of online security with a private network, and provides training and support to use the system. I was all for it.

Tell me about the process of transitioning your paper records to the electronic records? How long did it take?
​Gueipin and Elaine provided me with the hardware and software, set up, and training. They also provide the system security, and ongoing technical support for the electronic records system. The support is amazing. Often, providers are isolated. For me, it feels like a professional system with support and cohesion.

At first, it was about 10-15 hours of work at the first of the month. I first started with medications only [eMAR], and it took as long as it takes to enter medication orders. The eMAR is a no fail system. For example, with a PRN, caregivers have to write the result in the record, or they cannot close the entry. Also, I can easily track narcotics using the system.

There was a learning curve, but my caregivers picked it up quickly. We worked on it piece-by-piece until they were comfortable with each section.

Elaine then came to my home with a large scanner. I scanned all resident records into the system and they’re saved in a secure folder. All the [paper] records I have left are in two binders.

What are some other benefits of the system?
​I can send and receive [electronic] faxes to the doctor, and I can have legal representatives electronically sign documents.
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We also use the system to document resident activities and facility records, such as smoke detector testing. I can add reminders and tasks for staff. Caregivers log in with an individual login and see the reminders and tasks. I can run reports and look at tasks that were done. I can also see when caregivers read an email I sent.
My data is secure and consistently updated, and I can access the information securely and remotely. If we have a fire or earthquake, I can get into the system remotely and I don’t have to worry about losing records.

Tell me about your renewal inspection after you started using an electronic records system.
​It saved a lot of time. The inspection at my first home was in January (2019), and the renewal inspection of my second home was in March. I learned from the first inspection, and had everything ready to go for my second inspection. The licensor was in-and-out in two hours and got everything [the licensor] needed. I had no medication violations.

What advice do you have for other providers who are considering the transition to electronic records, but are concerned about either cost, the challenge of transitioning, licensing, or other issues?
​Take the time to learn the program. It’s especially beneficial for multiple homes. I can run compliance reports, and I can check on caregivers remotely and run audits to see who logged in, when, and what actions they took. The program is customized so it meets licensing requirements. If you do your due diligence, the system helps you be compliant.
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Finally, the cost is worth it. It’s less than ink and paper, and that doesn’t include the time saved. We’ve been thrilled with this. I can’t say enough positive about it.

About the Author

Alyssa is founder, principal consultant and training specialist with Oregon Care Home Consulting. She has spent the majority of her career providing program service delivery, regulatory leadership, training development, and program coordination and management in government and not-for-profit organizations. She is passionate about helping current and  future adult care home providers in Oregon successfully navigate the licensing process and provide quality care to seniors. ​

Article by Alyssa Elting McGuire, MA, MPA

I was recently sitting in a class on the topic of website marketing offered through the Small Business Development Center, and I started thinking to myself, “why do so many adult care home businesses not have websites?” I’ll be the first to admit I’m no marketing expert, but I can say I recognize the value of a small business having an online presence.

Why, as an adult care home provider, should you invest the time and money into having a website or an alternative web presence for your adult care home business? I’d like to give you seven reasons why you need an online presence that showcases you and your adult care home.
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• It’s part of your overall marketing plan. This is your passion, but it is also your business. You need a marketing plan, and you can’t ignore the fact an online presence can be an important marketing tool.
• Families are looking online for housing options for their loved ones. A business website probably won’t come up first on search engines, but you can make your presence known by using services such as Laria Care Finder where people can find detailed information about your home. Additionally, you can create a Google My Business account to be found through Google and on Google Maps. Also, Google My Business allows you to create a free basic website for your business.
• It lends you some credibility. In this day-and-age, if nobody can find your business online, they can become a bit skeptical about your business. This is also true if they visit your website, and it’s obvious you haven’t updated it since 2005.
• You have control over the content. You can post beautiful pictures of the inside and outside of your home, and offer any details that might be of interest to people looking to move to your adult care home.
• It gives people a personal connection to you, as a caregiver. Post photos of yourself and give information about your approach to providing care, and why you chose to go into this business.
• It gives you a forum to post client testimonials. Let people know about the great care you provide by posting client and family testimonials (while always keeping confidentiality in mind).
• Make it easy for people to find you. You want to make it as easy as possible for people to find information about your care home and your contact information.