Time Is Up! Fines Are Being Issued for Hospitals Failing to Comply with Transparency Rules

Time Is Up! Fines Are Being Issued for Hospitals Failing to Comply with Transparency Rules

Over a year-and-a-half ago, all 6,000 or so U.S. hospitals were required to provide pricing information online so patients could comparison shop and avoid surprises. After audits, warning letters, and requests for plans to take corrective actions, the Center for Medicare and Medicaid Services (CMS) recently started issuing fines for noncompliance – and they’re not cheap.

Starting January 1, 2021, hospitals were required to provide clear, accessible pricing information about the items and services they provide, as a machine-readable file and in a consumer-friendly format. CMS began auditing a sampling of hospitals that same month. Since that time, it issued over 350 warnings for noncompliance, followed by more than 150 corrective action plan requests from those who didn’t do anything after the initial warning. After addressing citations, 170 hospitals received case closed notices.

This past June, the CMS issued the first Civil Monetary Penalties to two hospitals in Georgia for noncompliance. One penalty was for over $200,000 and the other was for almost $900,000. Penalties are based on the number of beds at the facility and number of days out of compliance; they can range from $300 to $5,500 per day.

Should hospital administrators now expect a floodgate of fines? It depends on who you ask.

PatientRightsAdvocate.org conducted its own analysis of 1,000 websites and found just 14% fully met the transparency requirements. Over 85% didn’t include all information required in their machine-readable files. Less than one-third posted charges for 300 shoppable services in the format required. While 85% did provide a price estimator tool, 20% did not show discounted prices for the uninsured and self-paying clients.

As reported by Roll Call, “Turquoise Health, which was formed at the end of 2020 to analyze data and help providers and payers become compliant with the rules, has found that about 4,500 of the nation’s 6,093 hospitals have posted data files.”

The American Hospital Association asserts that most hospitals are in compliance, and that data that indicates otherwise may be misleading or not telling the whole story.

Perhaps the more interesting information comes from what the newly available data can tell us. A study of outpatient imaging at 89 of the leading pediatric hospitals conducted by the JAMA Network found 98% complied with the shoppable services requirement, but less than 40% complied with both the shoppable services and machine-readable file requirements. Data showed an 84% cash price variation for retroperitoneal ultrasound; 82% for a CT of the head without contrast; and 74% for abdominal ultrasonographies. The actual charge variations were much lower: 45%, 52% and 48%, respectively.

Only time will tell whether the new requirements (and fines) will ultimately lead to lower overall health care costs due to consumerism. Still, one big question remains: Will consumers use the website data to shop for their health care like a car or a home? To be continued…

In the meantime, you can always count on RBT CPAs to handle all your tax, accounting, audit, and other needs, so you’re freed up to focus on more important things like patient care and compliance. Please don’t hesitate to give us a call.

The State of Charter Schools in New York

The State of Charter Schools in New York

Charter schools are an alternative to public schools. They are paid for with taxpayer dollars, but are privately run and not subject to the rules of the local school district. Advocates assert these schools fill gaps and provide opportunities that would otherwise be unavailable, especially for our most disadvantaged populations. Critics maintain they take money away from public school students’ education and benefit from it.

There are over 350 charter schools operating in New York State alone, with greater freedom to tailor learning to better meet the needs of their students. A closer look shows they also promote diversity, inclusion, and equity in education. Take New York City as an example. The NYS Department of Education reported that for the 2020-2021 school year, 50% of students in the charter school system identified as Black; 40% identified as Latinx; 79% were economically challenged; 9.3% lived in temporary housing; and 8% were multilingual. (Beer, Song. New York City charter schools continue to emerge as an inclusive new opportunity. AMny.com)

Still, differing opinions about charter schools are reflected in a number of conflicting actions being taken at local, state, and federal levels.

In New York City, advocates are rallying to have charters reissued for schools previously closed and to make charter school seats available to more children. Thanks to Bloomberg Philanthropies, charter schools could apply for a portion of the $50 million in grants made available for elementary school children to attend school this summer and make-up for educational gaps created during COVID. What’s more, the 2023 state budget increases per-pupil funding at New York City charter schools by 4.7% to promote innovation, the recruitment of high quality teachers, and give families and students options.

At the federal level, there are new rules governing the Charter Program, including decreased funding and more transparency requirements to obtain grants (Strauss, Valerie. What the Biden Administration’s new rules for charter schools say. TheWashingtonPost.com). In addition, as reported by EducationWeek, “Incoming charter schools will have to gather community input and prove they aren’t managed by a for-profit company to receive federal funding under the Biden administration’s finalized Charter School Program rules.”

No doubt, there is more to come. Regardless of which side you stand on the charter school debate, we want you to know RBT CPAs is here to help all schools – public, private, and charter – uphold their financial disclosure requirements, as well as accounting, tax, and audit accountabilities. Find out what we can do for your school or school district – give us a call today.

Are Employee Stock Ownership Plans (ESOPs) Making a Comeback?

Are Employee Stock Ownership Plans (ESOPs) Making a Comeback?

Data doesn’t show a big resurgence in Employee Stock Ownership Plans (ESOPs), yet. Don’t be surprised if that changes, given the Great Resignation and increased competition for a shrinking pool of skilled workers.

Today, about 14 million employees participate in 6,500 ESOPs, which means there are fewer plans than in the past but more participants, according to the National Center for Employee Ownership.  UPS and United Airlines are two examples of large companies that offer ESOPs.

What about going forward? Well, that remains to be seen, but we believe all indicators are pointing towards potential growth in the number of plans offered and participants. Here’s why:

  1. Employers are having a hard time finding talent. Put simply, there are more jobs than people looking for jobs and, for the first time in a long time, employees are in the driver’s seat when it comes to deciding which company’s value proposition is worth their time and energy.
  2. Small and medium sized businesses are competing against Fortune 500 companies for talent. To level the playing field, employers may need to sweeten benefits and compensation offerings. That includes adding an ESOP to a benefit plan lineup.
  3. Current employees may be contacted by recruiters from companies that have ESOPs. Even if they aren’t thinking about switching jobs, hearing about a richer benefits and compensation package may pique their curiosity and interest.
  4. Talent shortages can impact business results. That doesn’t even get into the investment lost recruiting, interviewing, background checking, selecting a candidate, and creating a job offer only to have a job candidate say “yes” to a better offer elsewhere.
  5. Baby Boomers are retiring. As if the talent shortage isn’t challenging enough, employers are also facing what Forbes coined a silver tsunami.

Although there’s no one proverbial magic bullet to address staffing challenges, ESOPs do help attract, retain, engage, and motivate talent.

ESOPs can be an attractive addition to job offers for potential new hires and benefit programs for existing employees. An ESOP can be positioned as a way to enhance financial security and supplement retirement income. There’s also the added advantage that employees only pay taxes when they take a plan distribution (or they can opt to maintain the tax-deferred status by rolling over funds to an IRA or other qualified plan).

In addition to the potential monetary value, stock ownership can strengthen employee engagement by showing a company is making an effort to keep the employee around for a while and giving the employee an ownership stake in the success he/she helps create.

ESOPs also offer employers some valuable federal income tax breaks related to a portion of corporate stock and cash contributions, loans the plan takes out to buy shares, principal and interest payments, and tax-free earnings. What’s more, if you own a C-corporation and sell at least 30% of your stock to the ESOP, you may be able to defer capital gains taxes. Plus, there’s an abundance of research that shows companies that offer ESOPs are better able to weather economic uncertainties and storms than peers without ESOPs.

If you’re interested in learning more about the tax advantages of offering an ESOP or in exploring what an ESOP can do for your business, give RBT CPAs a call.  We’re always here to help.

Make Money for Makerspace

Make Money for Makerspace

Usually, new trends in education target a specific age group. Makerspace learning has been picking up steam over the last decade across all levels of education – from elementary schools to universities – making it an important curriculum, budget, and space consideration of educators and schools for all ages.

It is referred to in many ways: maker movement, maker learning, makerspace, and more. No matter the moniker you use, it’s one of the top trends in education and it’s growing in momentum. At the most basic level, maker education focuses on learning rather than teaching. It’s about making things hands-on and collaborating to find the best solutions.

You can find makerspaces in rooms, libraries, classrooms, dorms, and even businesses. (One school district even created a mobile makerspace vehicle to travel around to its various schools.) Makerspaces can focus on one area (i.e., art) or several (i.e., science, technology, engineering, art, and music). Even the NY Board of Education is getting in on makerspace bandwagon, with a $5 million grant to the City College of New York.

Today,  there are more schools with makerspaces than schools that don’t have them. After all, they’ve been shown to have a positive impact on creativity, collaboration, communication, and problem-solving – all critical skills for the future. Three key considerations for creating and managing a makerspace:

  • Materials & Tools: Identify what materials you need (i.e., paper, markers, tape, pipe cleaners, material, yarn, etc.) and what tools (i.e., hammer, sewing machine, glue gun, software, goggles, aprons, etc.) and how many students you’ll have.
  • Staffing: Who is going to organize, manage and run the makerspace? Will you need full-time staff, part-time staff, or volunteers? What kind of training or professional development will they need?
  • Physical Space & Infrastructure: What kind of space do you need? Where can you get it? Does it have or will you need to purchase basics like tables and chairs and cleaning equipment, or will you need to purchase them? As for infrastructure, you’ll want to be able to schedule sessions and people; track inventory and budgets; and document/digitalize anything else that will help manage and streamline daily operations.

Perhaps the biggest consideration is funding. Many schools start small and build support, supplies, and funding over time. There are several different avenues to pursue funding. You may want to solicit supplies and funding from local businesses, organizations, and art groups. Consider holding donation drives, for everything from knitting and art supplies to tools and building materials. The end of the school year is the perfect time to let teachers, parents, and students know where they can bring any unused or unwanted supplies – the makerspace area. And there’s always crowdsourcing through organizations like GoFundMe or Adoptaschool.org.

Look for opportunities to recycle – it’s a great way to stock up on materials while supporting your district’s go green goals. Also, check out upcycling organizations like  ReCreate and RAFT for ideas and supplies at a serious discount.

Grants big and small are available through businesses big and small – especially if their mission links to the focus of your makerspace. Also considering partnering with other functions in the school (i.e., the library) to leverage investments and equipment.

Makered.com has a number of free resources to help you get started and grow. The NY State Education Department includes numerous resources including how to get started from scratch, funding strategies, and even case studies revealing how places like Wappingers School District are growing makers education through all grades and schools.

While you’re focusing on how to build, expand, or maintain your school’s makerspace, let RBT CPAs help by focusing on related accounting and tax requirements and reporting. We are a leading accounting and tax firm in the Hudson Valley and New York. (We’re also among the top 250 nationally.) We have experience working with numerous educational institutions. Give us a call to find out how we can help you today.

340B Standards Updates: What Do They Mean to You?

340B Standards Updates: What Do They Mean to You?

With the passing of the Consolidated Appropriations Act of 2022, hospitals that depend on 340B Drug Pricing Program discounts to help make up budget shortfalls got some breathing room through the end of 2022.

Section 340B of the Public Health Service Act provides discounts on eligible outpatient prescriptions to hospitals serving a disproportionate share of low-income individuals not covered by Medicare and Medicaid. The formula used to determine discounts resulted in extra money for those hospitals – many of which operate with tight margins and have come to depend on those extra funds.

When COVID hit, many of these hospitals transformed operations to emergency response, stopping services for all but those dealing with COVID and other life-threatening issues. As a result, fewer people went to the hospital. In turn, a number of the hospitals were dropped from the 340B program because they didn’t meet minimum thresholds for Medicaid inpatient days.

The impact was dramatic. A study  by 340B Health showed critical access hospitals losing an average of 39% of contract pharmacy savings (or the equivalent of $220,000 per hospital). Of smaller rural hospitals, 10% said they lost at least $700,000. Larger hospitals reported losing 23% of their community pharmacy savings, with an average loss of $1 million and the top 10% losing $9 million or more.

Earlier this year, the $1.5 trillion Consolidated Appropriations Act of 2022 was passed. Among other things, it provides temporary relief on eligibility for the 340B Drug Pricing Program. The legislation ensures hospitals can stay in the program if they otherwise would lose eligibility based on patient data included in Medicare cost reports for 2020 through 2022.

Hospitals at risk of losing their 340B eligibility due to the pandemic will continue to be eligible through December 31, 2022. Those that lost eligibility could be reinstated by filing a self-attestation indicating the loss of eligibility stemmed from Covid-19 impacts with the Secretary of the Department of Health and Human Services (DHHS) within 30 days of enactment (April 14, 2022). However, reinstatement is not retroactive so any funds lost when eligibility ended will not be made up.

What happens after December 31, 2022 remains to be seen and may be determined in courtrooms. Since 2020, six major drug manufacturers stopped providing 340B discounts to entities that had an onsite pharmacy and contracted with outside pharmacies to distribute drugs purchased through the program. The companies assert the outside pharmacies receive discounts from both 340B and Medicare or Medicaid.

In 2021, Arkansas passed a law requiring drug manufacturers to sell to all contract pharmacies at 340B rates. This year, several states have tried passing similar legislation. A court ruling in the District of Columbia indicated DHHS doesn’t have authority to require the companies to resume drug discounts to 340B entities. In a separate case, the District of New Jersey court ruled pharmaceutical companies couldn’t limit the number of pharmacies used by a 340B entity. With opposing opinions in the courts, more litigation is required.

In another case, Becerra v Empire Health Foundation, Supreme Court justices are examining how Medicare calculates disproportionate share of hospital payments. The court’s opinion could limit DHHS’ ability to interpret the law and increase judicial policy’s role in interpreting health care statutes. The court’s opinion is expected next spring.

As if things can’t get any more complicated, Michigan is enacting laws to stop insurance companies and pharmacy benefit managers from discriminating against hospitals and other providers for participating  in 340B.

With no interested constituent appearing to be happy with the way things stand now, it looks like the future of 340B will be at the mercy of the courts. Stay tuned. In the meantime, if all the legal updates to 340B have you questioning accounting and tax repercussions for your organization, give RBT CPAs a call. We’re a leading accounting firm in the mid-Hudson Valley, providing support for a number of the region’s leading healthcare institutions.

Directions, Please! The Road to Recovery for School Bus Driver Shortages

Directions, Please! The Road to Recovery for School Bus Driver Shortages

Numerous forces are coming together with creative solutions to make sure yellow buses taking children to school do not become a lasting victim of the COVID pandemic.

Even before COVID, school districts across the nation were striving to curb a growing crisis resulting from a shortage of bus drivers working for districts or private busing companies. When COVID hit and schools went remote, thousands of private school bus companies had to hang their “closed for business” signs and thousands of school bus drivers were furloughed. Some found themselves better off financially on unemployment and with COVID rescue funds; others realized it was time to retire rather than risk exposure to the virus or getting vaccinated. Only a portion of private companies survived, which wasn’t even close to meeting the demand once in-person classes resumed.

During COVID, some districts kept their own drivers busy dropping off meals, school materials, and equipment. As for private companies, some districts continued minimum payments on contracts in the hopes of keeping them afloat; others simply stopped paying and became the target of breach of contract lawsuits.

While moving to remote learning during COVID provided a reprieve from dealing with the bus driver shortage, the issue escalated and returned with a vengeance as school districts tried to resume on-site learning. Private school bus companies began canceling routes and entire contracts literally days before (or slightly after) the start of the school year. The issue continues today with some schools periodically returning to remote learning – not because of COVID, but due to the driver shortage.

More than two million children in New York ride a yellow school bus each day, according to the New York Association for Pupil Transportation. Of the state’s 700+ school districts, over 60% use private busing companies – an industry hit hard by coronavirus. Students get to school late, get home late and miss extracurricular activities, while parents constantly adjust to changing schedules and bussing needs.

The US Department of Education (DOE) has been working with the Department of Transportation and the Federal Motor Carrier Safety Administration on possible solutions, including providing greater flexibility for bus driver licensing, using American Rescue Plan funds to address transportation issues, and hosting webinars to help districts understand how to use federal assistance to recruit, retain, and hire additional staff.

States are also taking action.

In New York, Governor Hochul introduced a variety of measures including expediting the process for obtaining a commercial driver’s license (CDL); increasing the capacity to administer road tests and written exams; and for school staff who hold a CDL, the state set up expedited testing allowing them to drive vans and buses temporarily. The governor also launched an outreach program to more than 550,000 CDL holders to help school districts recruit drivers across the state. More is coming with CDL tests to be conducted at third-party locations and the “under the hood” portion of the CDL test being temporarily eliminated.

While it may seem legal recourse in the form of breach of contract lawsuits may be the main “go-to” option for school districts, it doesn’t appear to be the norm. Instead, there seems to be recognition that this could potentially exasperate issues stemming from a national crisis that’s beyond anyone vendor’s control.  A National School Transportation Association’s survey conducted in March indicates “54% of school bus contractor members have more than a 10% driver shortage” – a shortage expected to last well beyond 2022.

There are other factors at play as well.

COVID sparked “the Great Resignation,” with many leaving their jobs or the workforce altogether. Fuel prices and inflation are driving up the costs of everything, including the pay workers are looking to receive. Bus driving companies are facing competition from other industries and employers (i.e., distribution centers) that provide better pay and benefits.

So, what have school districts and bussing companies done and what are they continuing to do to help turn things around?

A variety of things:

  • Districts in at least 9 states asked for help from the National Guard.
  • One district raised bus driver pay by about 30%, offering $21.67 to $29 an hour. A complimentary media blitz more than quadrupled driver interviews in days. What’s more, aids and drivers are offered bonuses: $500 a quarter for 95% attendance and $2,000 for anyone who worked through the pandemic. (Source: School Transportation News)
  • A district invited teachers and administrators to drive for a fixed dollar payment per run. There were 77 applicants and 10 teachers who availed of the opportunity. The district offered the CDL training and benefited from not having to pay for additional benefits since the drivers were existing staff. (Source: School Transportation News)
  • A private bussing business contacted competitors to provide substitute drivers while it trained new drivers (which takes 4 to 6 weeks) to no avail. It was able to work with another vendor to provide a later bus arrival option in the morning, a later afternoon bus, and an early morning drop-off option. Interestingly, this business is not increasing pay or offering bonuses because that just puts other private bussing companies in the same predicament. Instead, they are aggressively recruiting via all media and at job fairs. (Source: CT Insider)
  • Some districts have temporarily returned to remote learning while their private bussing companies train new drivers.
  • In one district, high school students living more than 7 miles from school were no longer transported but were given public transit bus passes for use on the county system, which 3,100 students now use.
  • In Philadelphia, parents receive up to $300 a month for driving a child to and from school.
  • In another state, one county is voting on whether to engage a van service available through the National Association of Pupil Transportation Collaborative to drive smaller groups of children and minimize route cancellations.
  • This past February, the OHIO DOE issued its own Driver Shortage Playbook, reviewing potential federal funds that can help, as well as tactics like hiring a marketing agency for job postings, consolidating routes, reaching out to retirees, providing creative incentives, and more.

While there are no easy answers, there are a variety of responses that together appear to be slowly getting the wheels on the buses turning.

As always, school districts should seek legal counsel when it comes to changes in policies, protocols, or contracts. If you need help evaluating financial or accounting impacts, RBT CPAs can help. Give us a call, today.

Calling All School Districts! Apply Now for Funds to Improve Student Mental Health Care

Calling All School Districts! Apply Now for Funds to Improve Student Mental Health Care

Declining mental health in children, teens, and adolescents.

If your district is looking for funding to improve mental health care for students, now’s your chance – apply for grants of up to $500,000 annually from New York State (NYS). The state is allocating up to $10 million each year over five years for eligible school districts to improve access to mental health care and supporting students who have experienced trauma that impacts their educational experience. The NYS Office of Mental Health (OMH) invites all eligible districts to apply by 3 PM EST on May 25.

Why Are These Grants Important?

Providing aid to economically disadvantaged students.

While the COVID-19 pandemic is waning, the impact on children’s and teens’ mental health, education and lives will likely last for years. As reported by Pew Charitable Trusts, “The American Academy of Pediatrics, the American Academy of Child and Adolescent Psychiatry, and the Children’s Hospital Association declared that the pandemic-related decline in child and adolescent mental health has become a national emergency.”

Statistics supporting this assertion are staggering:

  • A Journal of the American Medical Association for Pediatrics study found children and adolescents were more likely than adults to be completely isolated from others their age.
  • 18% to 60% had strong distress and showed symptoms of anxiety and depression.
  • Child protection referrals dropped between 27% and 40% suggesting signs of abuse or neglect were unnoticed due to the limited contact with educators.
  • More than 140,000 students lost a primary or secondary caretaker to the pandemic.
  • Nearly 40% of high school students reported poor mental health during the first half of 2021. More than 44% students reported feeling persistently sad or hopeless within the past year, with nearly 20% saying they’d seriously considered attempting suicide and 9% attempting suicide in that period.

(Sources: EdWeek, Center for Disease Control (CDC) and Prevention, CDC)

School districts, teachers and parents need assistance to help the youngest and most vulnerable members of our society – our children. Grants available through NYS can help.

Who’s Eligible?

the weak and vulnerable members of our society

A district is eligible to apply if its 2019-2020 economically disadvantaged student rate was above 55.6%. Each eligible school district (or Geographic School District in New York City) may submit one application addressing a single or multiple schools. Find a list of eligible school districts on the NYS Grants Gateway.

What Can Grants Be Used For?

Increasing access to mental health services for students

Grants focus on driving progress around three primary objectives: enhance student access to mental health services, implement integrated mental health supports, and strengthen partnerships with existing supports within the mental health system and the larger child-serving system. The Request for Proposal (RFP) identifies options to achieve each objective; applicants must choose one option to implement for each objective. More information is available in the RFP on the OMH website.

When Do Milestones Have to Be Completed?

May 18 is the deadline for submitting a Letter of Intent. (E-mail Carol Swiderski at carol.swiderski@omh.ny.gov and put Letter of Intent in the subject line).

May 25 at 3 PM EST is the deadline for submitting a proposal.

It’s anticipated that award notifications will occur June 22 and contract dates will start July 1.

Where Does My District Apply?

Apply using the NYS Grants Gateway System (GGS). (If you are not currently registered, you can find required forms at https://grantsmanagement.ny.gov/register-your-organization.) Submit proposals via the GGS by the May 25 (3 PM EST) deadline.  Late proposals will not be accepted.

To apply:

  • Log into the Grants Gateway
  • Click on the View Opportunities button under View Available Opportunities
  • In the Search Criteria, enter “Student Mental Health Support Grants to School Districts”
  • Select the Office of Mental Health as the Funding Agency and click Search
  • Click “Student Mental Health Support Grants to School Districts” and then click on the “APPLY FOR GRANT OPPORTUNITY” at the bottom left of the Main page of the Grant Opportunity.

For additional information, refer to the Vendor User Guide and these webinars and videos.

How Will Awards Be Determined?

Each proposal will be evaluated for each of the following:

  • Enhance access to Mental Health services — 20 points
  • Implement integrated supports – 20 points
  • Strengthen Partnerships – 20 points
  • Reporting – 15 points
  • Financial accountability – 20 points
  • Gun violence focal school districts – 5 points

Proposals will be scored, and awards will be made to the highest scoring applications until funds are exhausted or until there are no fundable applications remaining.

RBT CPAs are available to take care of all all your accounting and financial planning needs. Give us a call so (if eligible) you are freed up to focus on something more important to your district and students – applying for grants to support mental health.

The Benefits of Offering a 457 Plan to Government Employees

The Benefits of Offering a 457 Plan to Government Employees

Still feeling the affects of the Great Resignation?

With employers still feeling the effects of the Great Resignation, it’s a job seeker’s market and folks who are looking for work can afford to be picky about which employment offer to accept. Even employees who weren’t previously looking for another job are being poached by employers seeking to fill their own talent pools. How are government and nonprofit organizations supposed to compete for talent? One valuable tool that can strengthen employment job offer packages, engage employees, and benefits as a retention tool is a 457 (b) retirement savings plan.

A 457 (b) plan is comparable to the private sector’s 401(k) plan or the non-profit sector’s 403(b) plan,  which offers employees a tax-deferred way to save for retirement, along with a few additional perks.

  • Typically, state, and local government employees like public safety (i.e., firefighters), law enforcement (i.e., police officers), and other civil servants are eligible to participate in a 457 (b) plan – if one is available. Employees at certain hospitals, charities, and unions may also be eligible.
  • Employees can elect to contribute pre-tax pay (up to annual limits — $20,500 in 2022 or 100% of pay, whichever is less). This helps reduce their taxable income today, while helping them save for the future. Some plans even include a Roth feature, which allows employees to contribute after-tax pay, so they don’t have to pay taxes on future distributions (if certain conditions are met).
  • Employees age 50 and over have the option to make additional contributions – called catch up contributions – up to an annual limit ($6,500 in 2022). These are designed to help them catch up on building savings for retirement. For employees three years from retirement, catch up contribution limits are even higher.
  • Employees who have access to a 457(b) and another plan like a 401(k) or 403(b) plan, can contribute the maximum to both plans, significantly increasing savings for retirement.
  • Employers can make contributions (such as a match), but many do not.
  • To help funds grow, employees may have a choice of investment options.
  • 457 (b) plan participants who have left their employer can withdraw funds before age 59 ½ without any penalty – a 10% penalty applies under 401(k) and 403(b) plans.
  • Employees pay taxes on contributions and earnings when they receive distributions from the plan (since that’s typically during retirement when their income levels – and tax range – are lower, they’ll pay less taxes than would have been required had they still been working).
  • Employees may have several different payment options, depending on what’s offered through their plan.
  • At age 72, employees are required to take a minimum annual distribution (unless they still work for the employer that offers the 457 (b) plan).

Features and Benefits.

The features and benefits of offering a 457 (b) plan are even more attractive when you consider Pew research findings on the top reasons employees left their jobs in 2021. They included low pay, poor advancement opportunities, lack of respect, childcare issues, lack of flexibility, poor benefits, and more.

Offering a tax-deferred retirement savings plan like a 457 (b) is one way to show employees your organization cares about their financial well-being, helps make up for lower pay, and increases perception of the value of your benefits package. That doesn’t even get into fulfilling what many may perceive to be a civic duty – taking care of our elderly in retirement (many of whom are likely community members).

If your organization wants more information on a 457(b) plan, visit the NYS Deferred Compensation Board website. RBT CPAs representatives can also answer your questions and help you make informed choices about offering valuable retirement savings vehicles to your employees.

Healthcare CFOs Take on More Than Finance

Healthcare CFOs Take on More Than Finance

Geopolitical unrest, inflation, the COVID aftermath, skyrocketing gas and oil prices, supply chain challenges, the Great Resignation, and more hallmarks of living in 2022 are disrupting most industries, including healthcare. Chief Financial Officers (CFOs) are playing pivotal roles to help ensure short- and long-term success in the changing economic landscape.  Here’s how…

A McKinsey & Company 2021 survey shows over the last five years CFO responsibilities have dramatically expanded to include investor relations, post-merger integration, board engagement, procurement, and digital activities. CFOs in healthcare face additional, unique challenges that are further shaping their roles.

Healthcare CFOs are facing a burnt-out workforce and critical labor shortages (we’re talking nurses, medical assistants, and lab technicians); cannibalization of primary care services thanks to major retail chains’ entry into the market; supply chain disruptions impacting operations (not something you want when it comes to healthcare); and complete realignment of healthcare delivery due to explosive growth in telehealth. That’s in addition to handling and accounting for stimulus money, while managing compliance.

To navigate these challenges, the role of CFO is evolving beyond finance. According to the Healthcare Financial Management Association (HFMA) CFO of the Future survey, respondents indicate they will spend almost 25% of their time on strategy in the next three years to include a variety of actions like:

  • Filling gaps and complimenting existing resources by expanding healthcare systems regionally via satellite operations.
  • Promoting wellness and addressing the whole person.
  • Enhancing the patient experience.
  • Evaluating and refining capital investment strategy to ensure investments are in the right business lines, care, and products.
  • Enhancing or creating an environmental, social, and governance (ESG) strategy.
  • Automating and creating data warehouses to facilitate faster decision-making; eliminate non-value-added work; and upskill the existing workforce to do more strategic work.
  • Identifying opportunities for new revenue sources.
  • Focusing on cost structure to understand the cost of each step in the care process and increasing profitability through strategic cost reduction.
  • Better managing and measuring labor costs and productivity.
  • Playing a larger role in shaping recruiting, retention, and rewards strategies and programs (to address the Great Resignation and its aftermath and influence the people side of the business).
  • Outsourcing revenue cycle activities to reduce the cost of care and improve efficiency and effectiveness.
  • Renewing focus on contract negotiations and value-based contracts.
  • Completing transactions like reorganizations, mergers and acquisitions, joint ventures, carve-outs or divestitures, and Special Purpose Acquisition Companies (SPACs).

According to the 2022 BDO Healthcare CFO Outlook Survey, the healthcare industry is “boldly investing in the future, even in a time of uncertainty,” with nearly 70% of organizations expecting to increase profitability. To achieve goals, 59% of respondents say leadership will be the most critical CFO competency for success in the coming years.

If your business is looking for a partner to handle or advise on finances, tax, or auditing matters so your finance people and operations are freed up to focus on more strategic demands, give RBT CPAs a call. We have extensive experience partnering with healthcare organizations in the Hudson Valley and beyond.

Why You Need to Update Your Cybersecurity Now

Why You Need to Update Your Cybersecurity Now

The war in Ukraine is closer than you think. Recently, the  White House warned malicious attacks could be just a few keystrokes away, making it critical for local governments to close their digital doors, put their shields up, and protect people, data, and infrastructure from the disruption a cyberattack can cause. What’s even more worrisome is that Russia is just one part of a much larger problem – the U.S. saw a 917% increase in ransomware attacks of government operations between 2020 and 2021, and last year over 2,300 local governments, schools, and healthcare providers were victims of ransomware attacks.

While it may seem like cyber criminals would be more likely to target banks or global companies over local school districts or government offices, these soft targets are attractive because they haven’t had the funding or resources to build up their defenses. What’s more, financial gain isn’t the main goal of cyberattacks – disruption is. (Imagine the chaos that can be caused by something as simple as blocking access to emergency contact information for students at a public school?)

Cyberattacks can impact everything from emergency services (including 911 call centers) to tax collections, building permits, clean water, waste disposal, and more. Going after local governments is attractive to cyber criminals because of the low hanging fruit available, like Social Security Numbers and voter and tax payment information.

Recently, the U.S. Cybersecurity and Infrastructure Security Agency (CISA) – a component of the Department of Homeland Security – issued advisories indicating government, election, energy, water, and a few other organizations are likely targets. All organizations – small and large – are urged to step up security and be prepared to respond to and mitigate the impact of potential cyberattacks.  That includes training employees to help prevent attacks and conducting drills to make sure everyone knows what to do if an attack should occur.

With the approval of the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA) there’s over $1 billion for improving state, local and tribal cybersecurity. Planning for and managing those funds will happen at the state level, where Governor Kathy Hochul recently announced a proposed budget of $62 million to build up cybersecurity. So, it’s important to stay in the know about what New York’s Chief Information Officer, Chief Information Security Officer, and NYS Joint Security Operations Center are up to.

In the meantime, it’s easy to agree that more needs to be done to stand up to cyberattacks. The tough questions are “What?” and “How?” Recently, the Hudson Valley Pattern for Progress kicked off a series of cybersecurity live virtual events to answer those questions and included a review of free resources available to support local governments, including:

To free you up to focus on cybersecurity, RBT CPAs is available to handle all of your tax and accounting needs. We work with local governments and school districts throughout the Hudson Valley. Give us a call today.