OHIP Billings Reconciliation + Locum Cross-Provincial CPA 2026
Reviewed by Bader A. Chowdry, CPA, CA, LPA on
Last updated: July 19, 2026. Author: Bader A. Chowdry, CPA, CA, LPA — Insight Accounting CPA Professional Corporation, Mississauga.
OHIP billings accountant Ontario in one line: reconcile every remittance advice monthly, or lose 1%-3% of billings to errors you will never see.
Quick answer (45 words): Ontario physicians should reconcile OHIP remittance advices monthly, separate GST/HST-exempt OHIP revenue from taxable non-OHIP revenue, and register for HST when the four-quarter rolling non-OHIP threshold crosses $30,000. Locum physicians billing in multiple provinces must apply the destination-province HST rate. Insight Accounting CPA runs both.
Why does OHIP reconciliation matter?
Every OHIP remittance advice (RA) lists paid claims, denied claims, and clawbacks. Physicians who reconcile monthly catch billing-code errors, missed claims, and improper clawbacks within the six-month appeal window. Practices that skip reconciliation lose 1%-3% of billings to invisible errors annually — for a $500,000 OHIP-billing physician, that is $5,000-$15,000 of leaked cash flow per year.
How does OHIP reconciliation work in practice?
Q: How does a physician reconcile OHIP billings against remittance advices?
The mechanics are simple; the discipline is where practices fail. Each month:
- Export billed claims from the billing platform (Practice Solutions, OSCAR, Elation, MedAccess).
- Download OHIP remittance advice from the Ministry of Health provider portal.
- Match on claim number. Flag any billed claim with no RA entry as “pending investigation” and follow up within 30 days.
- Review denied claims (D-code denials). OHIP publishes denial-reason codes; many are correctable by resubmission with correct diagnostic code (ICD-10) or additional documentation.
- Review clawbacks (adjustments to previously paid claims). Clawbacks must be appealed within 6 months from date of RA under section 18 of the Health Insurance Act (Ontario).
- Reconcile to bank deposit. OHIP deposits the RA total minus clawbacks. Any variance means either a claim was paid outside the RA cycle or an OHIP deposit was missed.
Bader A. Chowdry, CPA, CA, LPA runs this reconciliation for retainer physician clients as part of monthly bookkeeping.
How is non-OHIP income taxed differently from OHIP?
Q: How is non-OHIP income (cosmetic, medical-legal, executive medicals) taxed differently from OHIP billings?
OHIP fee-for-service billings are exempt from GST/HST under Schedule V, Part II of the Excise Tax Act. The physician does not charge HST and cannot claim input tax credits on inputs used to earn that revenue.
Non-OHIP revenue is generally taxable at 13% HST in Ontario. Common taxable services:
- Cosmetic procedures (Botox, fillers, laser hair removal) — taxable under CRA policy P-249.
- Medical-legal reports for lawyers or insurance companies — taxable.
- Independent medical examinations (IMEs) for insurers or WSIB — taxable.
- Executive medicals for corporate wellness programs — taxable.
- Sick notes for employers — the position is nuanced; sick notes tied to an OHIP consult ride the exemption, standalone documentation charges are taxable.
Registration trigger: the $30,000 small-supplier threshold applies to taxable revenue only measured over 4 consecutive quarters. A physician with $500K OHIP + $40K cosmetic revenue is not under threshold — the $40K taxable exceeds $30K. HST registration is mandatory; the physician must charge 13% on cosmetic services and can claim input tax credits on cosmetic-related supplies.
How does the locum + cross-provincial physician plan?
Q: How does a locum physician working in multiple provinces plan taxes and HST?
A locum physician typically bills through their own name (T2125 self-employment) or their MPC. Two complications arise crossing provincial borders:
- GST/HST place-of-supply rules (ETA section 132.1 and Part IX regulations): the tax rate charged is determined by the province where the service is rendered, not the physician’s home province. An Ontario locum billing cosmetic services during a two-week Manitoba locum charges 5% GST + Manitoba PST (or 5% GST alone if PST-exempt), not 13% HST. If the same locum performs an executive medical in Nova Scotia, 14% HST applies.
- Provincial-fee-schedule payer: OHIP does not pay for services rendered outside Ontario. If the locum is paid by the Ministry of Health of another province (MSP in BC, AHCIP in Alberta, RAMQ in Quebec), that revenue is still HST-exempt (Schedule V, Part II is federal), but the T1 reports the income in the source province for provincial tax residency purposes.
Insight Accounting CPA files split-province T1 returns for locum clients and calculates the correct GST/HST rate on each non-OHIP invoice.
Comparison: sole-proprietor locum vs. MPC locum
| Item | Sole proprietor T2125 | MPC (Medicine Professional Corp) |
|---|---|---|
| Federal + Ontario combined marginal (top) | 53.53% | 12.2% (pre-July 2026) / 11.2% (post-July) on first $500K |
| GST/HST registration | Once $30K taxable | Once $30K taxable at corp level |
| CPP + EI | CPP self-employment (both halves) | CPP on T4 salary, none on dividend |
| RRSP room generation | Yes (via net self-employment income) | Only from T4 salary |
| Corporate compliance cost | Nil | $2,400-$4,800/year |
| CPSO Certificate of Authorization | Not required | Required ($400 + $175/year) |
| Recommended for locum > $180K net | Yes if incorporating soon; No if maxed on RRSP room via personal | Yes for career-locum with reinvestment plan |
Frequently asked questions
Q: How do I appeal an OHIP clawback?
Within 6 months of the remittance advice, submit a written appeal to the Ministry of Health citing the claim number, the reason for appeal, and supporting documentation. Physicians who appeal timely recover roughly 60% of clawbacks. Miss the window and the clawback is final.
Q: Are OHIP payments deposited to my personal account taxable in the MPC?
Only if paid to the MPC. OHIP pays the billing physician (personally or the MPC, depending on the OHIP billing number setup). If OHIP still pays the physician personally after MPC incorporation, the physician must direct-deposit or “assign” the OHIP receipts to the MPC and treat them as MPC revenue. Failing to align OHIP billing arrangements with MPC formation is one of the most common CPSO / CRA-audit trip points.
Q: Can I claim input tax credits (ITCs) on my medical office rent if I bill OHIP?
Only for the portion of the office used to generate taxable non-OHIP revenue. If cosmetic services are 10% of practice revenue but use 10% of office space, 10% of the rent HST is recoverable as an ITC. Insight Accounting CPA calculates the ITC-eligible pro rata annually.
Q: What about locums paid via agency vs. direct-billing?
Agency payments are generally treated as fee-for-service self-employment income; the agency issues a T4A. Direct-billing to hospitals or clinics is also self-employment. Neither generates T4 employment income unless the locum is on payroll. Withholding at source depends on the contract structure.
Related reading:
- How to Choose a CPA for a Medical Practice in Ontario
- Locum Physician Tax Restructuring Case Study
- How to Choose a CPA for Doctors in Ontario
Insight Accounting CPA Professional Corporation, Mississauga, Ontario. Bader A. Chowdry, CPA, CA, LPA. General information for Ontario physicians. Not tax, legal, or accounting advice for your situation. Please engage Insight Accounting CPA — or another Ontario CPA firm led by a Licensed Public Accountant — before acting.
Additional CRA & Government Resources
Source: Ontario — OHIP Schedule of Benefits and Fees.
Source: CRA — Your Province or Territory of Residence.
Source: CRA — Report Business Income and Expenses.
Important — informational only, not advice. Do not use this article to make any decision.
This article is published by Insight Accounting CPA Professional Corporation for general educational purposes only. It is not tax, legal, accounting, financial, or investment advice, and nothing in this article should be relied upon — by anyone, for any purpose — to make a business, tax, financial, accounting, legal, or investment decision.
Tax law, CRA administrative positions, court interpretations, and Ontario provincial rules change frequently, sometimes retroactively, and the content of this article may be incomplete, simplified, out of date, or wrong by the time you read it. The right answer for your specific situation depends on facts this article does not know — your structure, history, jurisdiction, filings, contracts, and goals.
Before acting, engage your own Chartered Professional Accountant or qualified advisor who has reviewed your specific circumstances in writing. Insight Accounting CPA Professional Corporation, the author, and any contributors expressly disclaim all liability — direct, indirect, or consequential — for any action taken or not taken on the basis of this content.
Insight Accounting CPA Professional Corporation is led by Bader A. Chowdry, CPA, CA, LPA — licensed by CPA Ontario under the Public Accounting Act, 2004. To engage us for situation-specific advice, book a free 30-minute discovery call.
