Healthcare & Medical Practice Audit UAE 2025: DHA, DOH & Clinic Compliance

The UAE healthcare sector, valued at AED 85 billion with 6,500+ medical facilities, operates under strict regulatory oversight from Dubai Health Authority (DHA), Department of Health Abu Dhabi (DOH), and other emirate health authorities, requiring specialized accounting for patient billing, insurance claims, and medical inventory.

Healthcare Regulatory Compliance Audit

DHA (Dubai Health Authority) Requirements

Medical facilities in Dubai must comply with:

• Facility license renewal (annual)
• Practitioner licenses for all medical staff
• Accreditation standards (DHA-HRS)
• Patient safety protocols
• Infection control requirements

Audit Verification: Confirm facility and practitioner licenses current, review DHA inspection reports, assess compliance violations, verify license fees paid timely.

DOH (Department of Health Abu Dhabi)

Abu Dhabi healthcare providers must meet:

• DOH facility standards (RACS - Requirements & Assessment Criteria)
• Healthcare professional licensing
• Quality management systems
• Clinical governance frameworks

Audit Consideration: Similar to DHA, verify all licenses valid, review inspection findings, assess compliance status.

Patient Billing Revenue Audit

Revenue Recognition Complexity

Healthcare revenue comes from multiple sources:

• Cash-paying patients (immediate revenue)
• Insured patients (revenue subject to insurance approval)
• Corporate accounts (monthly billing)
• Government patients (MOHRE, Armed Forces, etc.)

Insurance Claims Revenue

Accounting Challenge: Revenue initially recorded but subject to insurance approval/adjustment

Typical Process:

1. Patient receives treatment
2. Clinic submits claim to insurance
3. Insurance approves/rejects/adjusts claim (typically 30-60 days)
4. Clinic receives payment (minus co-pay and deductibles)

Audit Procedures:

• Review insurance aging analysis
• Test claims older than 90 days (collectability concern)
• Verify provision for claim rejections adequate
• Test claim approval rates by insurance company
• Assess co-pay and deductible accounting

Common Findings:

• Revenue not adjusted for expected claim denials
• Old claims not written off (overstates receivables)
• Co-pays not properly recorded as patient receivable

Contractual Adjustments

Insurance companies negotiate discounted rates:

• List price for procedure: AED 1,000
• Insurance contractual rate: AED 750
• Contractual adjustment: AED 250 (expense or revenue reduction)

Audit Verification: Test contractual adjustments, verify rates per insurance contracts, confirm adjustments properly calculated.

Medical Inventory Audit

Unique Inventory Characteristics

Pharmaceuticals: Subject to expiry dates, temperature control, controlled substance regulations

Medical Supplies: Sterile items, surgical consumables, implants

High-Value Items: Stents, pacemakers, prosthetics (often patient-specific)

Expiry Date Management

Critical audit area: Expired inventory must be written off

Audit Procedures:

• Physical count including expiry date recording
• Identify items expiring within 6 months
• Verify provision for near-expiry items
• Confirm expired items written off not sold to patients
• Review inventory turnover (should be high for perishables)

Common Finding: Expired medications not written off, remaining in inventory valuation.

Controlled Substances

Narcotic and controlled medications require special controls:

• Secure storage (locked cabinet)
• Usage register maintained
• Prescriptions documented
• Regular audits by health authority

Audit Verification: Review controlled substance register, verify usage reconciles to prescriptions, test physical count, assess compliance with DHA/DOH regulations.

Insurance Claims Aging Analysis

Healthcare facilities should maintain aging analysis:

• 0-30 days: 40-50% of receivables (normal)
• 31-60 days: 25-30% (follow-up needed)
• 61-90 days: 10-15% (concern)
• 90+ days: <10% (likely uncollectable)

Audit Assessment:

• Review aging analysis
• Test old balances for collectability
• Verify provision for doubtful debts adequate
• Assess collection procedures for aged claims

Red Flag: High percentage of 90+ day receivables suggests revenue recognition issues or collection problems.

Doctor Revenue Sharing Models

Many clinics operate revenue-sharing arrangements:

Common Models:

• Doctor receives percentage of revenue generated (typically 40-60%)
• Clinic retains remainder for overhead and profit
• Monthly settlement of doctor share

Audit Procedures:

• Review doctor contracts and revenue-sharing terms
• Test revenue allocation calculations
• Verify doctor payments reconcile to revenue generated
• Assess proper classification (employee vs. contractor)
• Check wage protection system compliance if employee

Tax Implication: UAE Corporate Tax may apply differently based on doctor classification.

Medical Equipment Audit

Fixed Asset Accounting

Healthcare facilities invest heavily in medical equipment:

• Diagnostic equipment (MRI, CT, X-ray)
• Laboratory equipment
• Surgical instruments
• Dental chairs and equipment

Audit Procedures:

• Physical verification of major equipment
• Test depreciation calculation (typically 5-10 years)
• Verify maintenance contracts in place
• Assess calibration and certification compliance
• Check equipment licenses/permits current

Capitalization vs. Expense

Capital: Equipment >AED 10,000 with multi-year useful life

Expense: Small instruments, routine replacements, repairs

Audit Review: Sample equipment purchases and assess capitalization appropriate.

Professional Indemnity Insurance

Medical practitioners must maintain malpractice insurance:

DHA/DOH Requirement: Professional indemnity coverage mandatory for license renewal

Minimum Coverage: Varies by specialty (AED 2-10 million typical)

Audit Verification: Confirm insurance policy in place, verify coverage amounts meet requirements, check policy beneficiary correct, assess premium expensed properly.

Patient Data Protection (PDPL Compliance)

UAE Personal Data Protection Law (PDPL) applies to patient health records:

Requirements:

• Patient consent for data processing
• Secure storage of medical records
• Access controls (only authorized staff)
• Data breach protocols
• Retention policy compliance

Audit Consideration: Assess data protection controls, review access logs, verify patient consent documented, check compliance with data retention requirements.

Common Healthcare Audit Findings

1. Insurance Revenue Overstated: Claims not adjusted for expected denials

2. Expired Inventory Not Written Off: Pharmaceuticals past expiry date remain in books

3. Aging Claims Not Provided: 90+ day receivables not reserved as doubtful

4. Doctor Payments Not Reconciled: Revenue-sharing calculations incorrect or undocumented

5. Licenses Expired: Facility or practitioner licenses lapsed (regulatory violation)

6. Controlled Substances Register Incomplete: Narcotic usage not properly documented

Multi-Emirate Practice Considerations

Healthcare groups operating across emirates face:

• Multiple regulatory authorities (DHA, DOH, MOHAP)
• Different licensing requirements per emirate
• Separate facility audits per location
• Inter-company billing for centralized services

Audit Complexity: Each location must comply with respective authority; auditor verifies compliance separately for each emirate.

Preparing for Healthcare Audit

Regulatory Licenses: DHA/DOH facility license, practitioner licenses, pharmacy license (if applicable), radiology license

Patient Billing: Insurance aging analysis, claim submission records, payment receipts, contractual rate agreements

Medical Inventory: Count sheets with expiry dates, controlled substance register, purchase invoices, expiry write-off documentation

Doctor Agreements: Revenue-sharing contracts, monthly settlement reports, payment records

Insurance: Professional indemnity policy, malpractice coverage confirmation

Frequently Asked Questions

What regulatory bodies oversee healthcare audits in UAE?

Dubai Health Authority (DHA) oversees Dubai healthcare providers, Department of Health Abu Dhabi (DOH) regulates Abu Dhabi facilities, and Ministry of Health and Prevention (MOHAP) supervises other emirates.

Are medical practices required to have annual audits?

Most licensed healthcare facilities in UAE must submit audited financial statements annually to their licensing authority, with larger hospitals and clinics typically requiring statutory audits regardless of licensing requirements.

Conclusion

Healthcare and medical practice audits require specialized expertise in patient billing revenue recognition, insurance claims accounting, medical inventory management with expiry tracking, doctor revenue-sharing arrangements, and UAE healthcare regulatory compliance across DHA, DOH, and other authorities. The combination of complex revenue sources, expiry-sensitive inventory, and strict regulatory oversight makes healthcare audits uniquely challenging.

As Ministry-approved auditors with extensive UAE healthcare sector experience across clinics, hospitals, dental practices, and diagnostic centers, Farahat & Co provides specialized audit services addressing patient billing controls, insurance claims analysis, medical inventory management, regulatory compliance verification, and doctor arrangement audits, ensuring comprehensive audits tailored to the healthcare industry's unique requirements.

Related Resources

• Healthcare Audit Services - Medical practice and hospital audits
• Revenue Cycle Management Services - Patient billing and claims optimization
• DHA/DOH Licensing Services - Healthcare regulatory compliance support
• External Audit Services - Statutory audit services for healthcare facilities
• Internal Audit Services - Risk assessment and control evaluation for medical practices