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Who this applies to: CFOs, controllers, finance directors, HR directors, benefits administrators, and plan administrators at employers that sponsor 403(b) plans using pre-approved documents.

The IRS has established a critical compliance deadline for 403(b) plan sponsors: all pre-approved 403(b) plan documents must be restated under Cycle 2 no later than December 31, 2026. Failure to meet this deadline could jeopardize a plan’s tax-advantaged status—creating significant operational, financial, and fiduciary risk. 

While the requirement itself is not new, many plan sponsors have not yet begun the restatement process. As year-end approaches, capacity constraints at document providers, recordkeepers, and advisors may create bottlenecks. Acting now will help ensure timely compliance and avoid last-minute complications.

Why the Cycle 2 restatement matters 

The IRS requires periodic restatements of pre-approved 403(b) plans to incorporate: 

  • Legislative and regulatory changes 
  • IRS guidance issued since the prior cycle 
  • Updates to plan language and operational requirements 

The Cycle 2 restatement reflects changes since the first remedial amendment cycle for 403(b) plans, including updates related to hardship distributions, loan rules, and required minimum distributions, among others. 

Importantly, this restatement is not optional—it is a condition of maintaining the plan’s qualified status under Internal Revenue Code Section 403(b).

Who is affected?

This requirement applies to employers sponsoring 403(b) plans that use pre-approved plan documents, including: 

  • Public schools and educational organizations 
  • Tax-exempt organizations under IRC Section 501(c)(3) 
  • Certain ministers and church-related organizations (depending on document structure) 

If your plan is individually designed, different rules may apply—but most 403(b) plans today utilize pre-approved document formats. 

Key action steps for plan sponsors

To help ensure compliance ahead of the December 31, 2026 deadline, we recommend the following steps:

1. Confirm your plan document type 

Determine whether your 403(b) plan uses a pre-approved document (vs. individually designed). 

  • If you are unsure, consult with your recordkeeper, third-party administrator (TPA), or ERISA counsel. 
  • This step is critical, as the Cycle 2 requirement specifically applies to pre-approved plans. 

2. Review the Cycle 2 restated document 

Once your provider issues the updated plan document: 

  • Review the restated provisions carefully. 
  • Pay close attention to operational changes that may affect plan administration or participant eligibility. 
  • Coordinate with your advisor to understand any new responsibilities or compliance considerations. 

3. Adopt the restated plan by December 31, 2026 

Formal adoption must occur by the IRS deadline: 

  • Execution typically requires an authorized employer representative. 
  • Late adoption may require correction under the IRS Employee Plans Compliance Resolution System (EPCRS), which can involve additional cost and administrative burden. 

4. Retain the executed document 

Maintain a fully signed copy of the restated plan document: 

  • Store it with your permanent plan records in your ERISA file
  • Ensure it is accessible for auditors, regulators, or internal governance reviews. 

5. Distribute an updated Summary Plan Description (SPD) 

An updated SPD reflecting the restated plan provisions: 

  • Must be provided to participants within 210 days following plan adoption.
  • Should clearly communicate plan terms in a participant-friendly format.

6. Communicate material changes 

If the restatement introduces material changes impacting participant rights or benefits: 

  • Provide clear and timely communication to participants. 
  • Consider targeted messaging to affected populations. 
  • Align communications with fiduciary best practices for transparency. 

Avoiding year-end capacity constraints 

A key practical consideration for 2026 is vendor capacity. Historically, plan sponsors that wait until the fourth quarter to begin restatement: 

  • Experience delays in receiving documents 
  • Encounter limited availability from TPAs and advisors 
  • Risk missing the adoption deadline 

Starting the process early allows for: 

  • Thorough document review 
  • Adequate time for internal approvals 
  • Proper coordination of participant communications 

Fiduciary considerations 

From a fiduciary perspective, timely compliance with the Cycle 2 restatement requirement is part of maintaining prudent plan governance. Failure to act could result in: 

  • Plan disqualification risk 
  • Increased scrutiny during audits 
  • Operational failures requiring correction 

Proactive planning, documentation, and communication demonstrate sound fiduciary oversight and help protect both the plan sponsor and participants. 

Plan sponsors should act now

The Cycle 2 restatement deadline of December 31, 2026 is fast approaching. While the process is manageable, it requires coordination and timely action. Plan sponsors should act now to confirm their document status, engage their service providers, and begin the review and adoption process well in advance of year-end.

Key takeaways

  • Confirm whether your 403(b) plan uses a pre-approved document, because the Cycle 2 restatement requirement applies specifically to pre-approved plans. 
  • Adopt the restated 403(b) plan document by December 31, 2026, to help maintain the plan’s tax-advantaged status. 
  • Review the updated plan provisions for changes that may affect plan administration, participant eligibility, or compliance responsibilities. 
  • Retain the fully executed restated plan document with permanent plan records, so it is available for audits, regulators, or governance reviews. 
  • Communicate updated plan terms and any material changes to participants within the required time frame.

Need help or have questions? Reach out to your BerryDunn or Creative Planning Retirement Services teams. 

Article
403(b) plan sponsors face 2026 Cycle 2 restatement deadline

Who this article applies to: Read this if you are a CEO, CFO, board member, or other professional involved in the Form 990 reporting process at a nonprofit organization that files Form 990.

You've probably heard the phrase "show the receipts." In today's world, this means being able to support your claims with clear evidence and documentation. While transparency has always been a cornerstone of the nonprofit sector, lawmakers and regulators are looking to place even more emphasis on transparency, accountability, and disclosure.

In April 2026, the US Department of the Treasury announced plans to revise Form 990. According to the announcement, the proposed revisions are intended to improve transparency, strengthen tax administration, and enhance reporting related to certain activities of organizations exempt under Internal Revenue Code Section 501(c)(3), including government contracts, government grants, and fiscal sponsorship arrangements. Treasury officials have indicated the initiative is intended to improve visibility into how charitable organizations receive and use funds, particularly where complex organizational structures exist.

Five legislative proposals focused on nonprofit transparency

In July, as a follow-up to the Treasury’s April announcement, the House Ways and Means Committee—the chief tax-writing committee in the US House of Representatives—approved five proposed pieces of legislation aimed at increasing transparency and accountability within the nonprofit sector.

1) Foreign Funding Transparency Act (H.R. 9772) – House Ways and Means Committee memo

  • Requires tax-exempt organizations to collect and report to the IRS the aggregate amount of donations received from foreign nationals. 
  • Mandates that tax-exempt organizations include as a separate line item the aggregate amount of donations received from those foreign nationals who are from a foreign country of concern (i.e., China, North Korea, Russia, Iran). 
  • Addresses how dual citizenship is reported for foreign nationals from a country of concern to ensure accurate reporting.

2) Stopping Foreign Influence in Elections Act of 2026 (H.R. 9771) – House Ways and Means Committee memo

  • Enacts a penalty on tax-exempt organizations that receive contributions from foreign nationals and then donate to a Political Action Committee (PAC) or a 501(c)(4). Penalty is twice the amount of the contribution given to the entity.
  • Establishes secondary excise tax on tax-exempt organizations that contribute to a PAC or 501(c)(4) organization if they have received a contribution or gift from a foreign national within the last two years.
    • Excise tax on the first contribution is equal to 100% of the contribution to the PAC.
    • Excise tax on the second contribution is equal to 200% of the contribution to the PAC. 
  • Suspends tax-exempt status for two years, beginning on the date a tax-exempt organization makes a third contribution to a PAC, and imposes an additional 200% excise tax.

3) Fiscal Sponsorship Transparency Act (H.R. 9721) – House Ways and Means Committee memo

  • Requires tax-exempt organizations to disclose the following information regarding certain fiscally sponsored projects:
    • Name of each party, other than any individuals, subject to the arrangement
    • Aggregate amount of funds made available or transferred to the project
    • Description of the activities related to the amounts made available or transferred
    • Name of the individual designated as the principal officer managing the fiscal sponsorship arrangement on behalf of the organization
    • Date on which the arrangement began, and if applicable, the date on which the arrangement ended
  • Imposes excise taxes on organizations acting merely as a conduit for a third party that is not tax-exempt.

4) Fair Treatment of Religious Organizations Act of 2026 (H.R. 9722) – House Ways and Means Committee memo

  • Amends IRC §501 to require that determinations of religious purpose be made without regard to an organization's beliefs or practices concerning marriage, sexuality, or gender identity—even if inconsistent with public policy. Protections extend to §501(c) status, eligibility for deductible contributions, and any other federal benefit tied to charitable status. 
  • Clarifies that a belief does not fail to be treated as a religious belief merely because it is not compelled by or central to a system of religion. 
  • Applies to taxable years beginning after December 31, 2025.

5) Tax Exempt Hospital Transparency Act (H.R. 9504) – House Ways and Means Committee memo

  • Amends IRC § 6033 governing disclosure to require additional reporting from all tax-exempt hospitals, including: 
    • CMS certification number for each hospital facility
    • Value of the financial assistance provided during a taxable year
    • Number of completed financial assistance applications received, granted, and denied during a taxable year
  • Requires the following additional reporting from large tax-exempt hospitals that have more than 100 inpatient beds:
    • Amount of spending to address the three highest priority health needs identified in the most recent Community Health Needs Assessment and a description of actions taken during the taxable year to meet each need
    • Amount of spending on: 
      • Quality improvement
      • Nonclinical programming
      • Other community benefits that the Secretary may prescribe
  • Requires the following additional reporting from high revenue tax-exempt hospitals that have more than $100 million in net patient revenue: 
    • Spending on advertising costs
    • Information on health service lines
    • Information on 340B drug discount program

Importantly, while the House Ways and Means Committee has approved these proposals, they must complete the legislative process before becoming law. While specific details regarding potential changes to Form 990 remain unclear, the message from policymakers is not: changes are likely on the horizon.

What does this mean for tax-exempt organizations?

Currently, there are no immediate changes to Form 990 reporting requirements. Further, if history is any indication, modifications to Form 990 traditionally move at a deliberate pace and involve an extensive review and development process. This includes public comment periods, which allow practitioners, organizations, and other stakeholders an opportunity to provide feedback, ask questions, and seek clarification before any new requirements are finalized or enacted.

These recent developments serve as a helpful reminder that strong recordkeeping and documentation efforts remain crucial. Organizations should continue maintaining thorough support for their activities, grants, government funding, transactions, and governance practices. If future reporting requirements do emerge, an organization with sound documentation processes in place will generally fare better than those who do not.

Despite past precedent, could changes still be coming for the 2026 Form 990 as we approach the end of the year? Absolutely.

Key takeaways

  • Recognize that proposed Form 990 revisions are intended to increase transparency around government grants, contracts, fiscal sponsorship arrangements, and other activities of tax-exempt organizations.
  • Monitor the five nonprofit transparency bills approved by the House Ways and Means Committee, which must still move through the full legislative process before becoming law.
  • Understand that no immediate Form 990 reporting changes apply yet, and any revisions may still involve review, development, and public comment.
  • Maintain thorough documentation for activities, grants, government funding, transactions, and governance practices to better prepare for potential new reporting requirements.

About BerryDunn

The transparency conversation is still unfolding, and BerryDunn is actively monitoring all legislative and regulatory developments potentially affecting tax-exempt organizations. As additional guidance becomes available, we will continue to keep clients informed and help organizations understand what these developments may mean. Until then, we recommend watching for more developments and keeping your receipts. Learn more about our team and services.

Article
Congress wants receipts: Nonprofits may face new transparency rules

Who this applies to: Broker-dealers and their audit committees/boards. 

The Public Company Accounting Oversight Board (PCAOB) recently released its 2025 Annual Report on the Interim Inspection Program Related to Audits of Brokers and Dealers, providing insight into the quality of broker-dealer audits and attestation engagements performed by PCAOB-registered firms. 

While the PCAOB reported improved inspection results in 2025, many of the deficiencies occurred in areas that remain a focus for SEC, FINRA, and PCAOB oversight. Broker-dealers should view the report as a roadmap to the areas most likely to attract regulatory scrutiny.

Inspection results continue to improve

The PCAOB inspected 61 firms and reviewed 103 broker-dealer audits during 2025. In its review, the PCAOB focused on areas involving heightened risk to investors and the protection of customer assets. Overall, inspection results improved across examination engagements, review engagements, and financial statement audits. 

The PCAOB found the following:

  • Deficiencies in examination engagements (broker-dealers filing compliance reports) decreased to 40%, compared to 59% in 2024. 
  • Deficiencies in review engagements (broker-dealers filing exemption reports) were 41%, generally consistent with the prior year. 
  • Deficiencies related to sufficient or appropriate evidence in financial statement audits declined to 56%, compared to 66% in 2024.

While inspection results improved, deficiencies remain common across broker-dealer audits and attestation engagements. 

Revenue remains the leading source of audit deficiencies 

Revenue testing was once again the area with the highest number of deficiencies. The PCAOB identified revenue-related deficiencies in 38 of 102 audits in which revenue was reviewed (37%).  

Common issues included: 

  • Insufficient testing of commission, underwriting fee, and advisory fee calculations 
  • Inadequate procedures to support revenue recognition under ASC 606, including the evaluation of performance obligations and related disclosures 
  • Overreliance on information provided by broker-dealers or service organizations without sufficient testing 

Revenue is often one of a broker-dealer's most significant accounts and frequently involves management judgment and complex accounting considerations. Deficiencies in this area can result in audit adjustments, disclosure issues, and increased scrutiny from regulators, and they can potentially delay the completion of financial statement audits. Broker-dealers should ensure revenue streams are well documented and supported by controls that demonstrate compliance with ASC 606 and other applicable reporting requirements.

Continued scrutiny of customer protection and compliance requirements 

For broker-dealers that hold customer assets or are subject to customer protection requirements, the PCAOB again identified deficiencies related to compliance examinations. Many of these findings involved insufficient testing of controls over compliance with SEC financial responsibility rules.  

Key observations included:

  • Insufficient testing of controls related to customer reserve calculations and possession or control requirements under the Customer Protection Rule 
  • Failure to adequately evaluate important controls governing customer assets, including management review controls and controls over information used in regulatory calculations 
  • Deficiencies in testing information produced by service organizations and information technology controls 

For broker-dealers subject to SEC Rule 15c3-3 or other financial responsibility requirements, weaknesses in compliance controls can lead to regulatory findings, increased examination activity, and questions about the safeguarding of customer assets. Strong documentation and effective controls are essential not only for audit purposes but also for demonstrating ongoing regulatory compliance. 

Evaluating audit results remains a challenge 

The PCAOB observed an increase in deficiencies related to auditors' evaluation of financial statement presentation and disclosures. Deficiencies in this area were identified in 27 audits (26%), up from 16% in the prior year.  

Examples included failures to identify:

  • Incomplete or inaccurate disclosures related to revenue recognition under ASC 606, including required information about performance obligations 
  • Financial statement presentation and disclosure issues involving cash flows, fair value measurements, and income taxes 
  • Omitted or incomplete disclosures associated with related-party transactions, segment reporting, fair value measurements, and other required GAAP disclosures 

These findings highlight the importance of not only accurate accounting but also thorough disclosure reviews during the financial reporting process. 

Related-party relationships and transactions remain a regulatory focus 

The PCAOB continues to identify deficiencies associated with auditors' evaluation of related-party relationships and transactions. In 2025, deficiencies were identified in five of the 30 audits in which related-party relationships and transactions were reviewed (17%), compared to 36% in 2024. While this represents improvement from prior years, related-party arrangements remain an area of heightened scrutiny due to the unique business structures commonly found within broker-dealer organizations. 

Common findings included: 

  • Insufficient testing of revenue and expense allocations between broker-dealers and affiliated entities 
  • Failure to verify the accuracy and completeness of data used in allocating revenues and expenses between broker-dealers and their affiliates 
  • Inadequate evaluation of whether allocations were consistent with written intercompany agreements 
  • Omitted or incomplete related-party disclosures required under ASC 850 
  • Insufficient communication of related-party matters to those charged with governance

Broker-dealers frequently operate within networks of affiliated entities and may share personnel, facilities, technology platforms, and operating costs across those entities. As a result, expense-sharing arrangements, management fee allocations, clearing relationships, and other affiliated transactions often attract audit and regulatory attention. Management should periodically review related-party agreements, ensure allocation methodologies are consistently applied and supported, and confirm that all required disclosures are complete and accurate.

Fraud-related procedures continue to attract attention 

The PCAOB also identified recurring issues related to journal entry testing and fraud risk considerations.  

Common findings included: 

  • Failure to select journal entries with fraud-related characteristics 
  • Incomplete journal entry populations 
  • Insufficient testing of supporting documentation 
  • Lack of rationale for excluding journal entries from testing 

Broker-dealers should view these findings as a reminder that fraud risk assessment extends beyond the audit process. Strong internal controls, management oversight, and monitoring activities can help identify unusual transactions before they become regulatory or financial reporting issues. Because fraud-related procedures remain a core PCAOB focus, weaknesses in these areas may attract increased attention during both audits and inspections.

Turning inspection findings into action 

The PCAOB's report is more than a summary of audit deficiencies. It provides broker-dealers and those charged with governance with valuable insight into the financial reporting, compliance, and control areas receiving the greatest regulatory attention. By understanding these common inspection findings, management can strengthen controls, improve documentation, enhance disclosures, and better position the organization for audits, examinations, and ongoing regulatory oversight.  

For broker-dealers, the strongest response to the PCAOB's inspection findings is a proactive one: 

  • Identify gaps before the audit begins. 
  • Strengthen controls before regulators identify deficiencies. 
  • Maintain a year-round focus on financial reporting and compliance risks. 

Key takeaways

  • Monitor PCAOB inspection findings to understand which broker-dealer audit and attestation areas are most likely to receive regulatory scrutiny. 
  • Strengthen documentation, controls, and disclosures around revenue recognition, customer protection, related-party transactions, and fraud procedures. 
  • Review audit readiness throughout the year so financial reporting and compliance issues can be addressed before audits, examinations, or inspections.

About BerryDunn

Our financial services team understands the complex regulatory environment that broker-dealers operate in and provides practical solutions to help you stay ahead of requirements. From broker-dealer financial statement audits to tax preparation, compliance, and consulting services, we tailor our services to meet your unique needs. Learn more about our team and services. 

Article
PCAOB 2025 inspection report: Broker-dealer & audit committee insights

Who this applies to: Those responsible for price transparency reporting, revenue cycle/registration, or contracting at an Inpatient Prospective Payment System (IPPS) hospital or in a reimbursement department at a healthcare facility. 

The Centers for Medicare and Medicaid Services (CMS) introduced Worksheet S-12 to Form CMS-2552-10, adding a new reporting requirement for certain IPPS hospitals. Effective for cost reporting periods ending on or after January 1, 2026, applicable hospitals must report the weighted median Medicare Advantage Organization (MAO) payer-specific negotiated charge by Medicare Severity Diagnosis Related Group (MS-DRG) for inpatient discharges during the cost reporting period.

What Worksheet S-12 measures and why it matters 

Although the worksheet refers to negotiated “charges,” the reported amount is better understood as the negotiated payment rate or estimated payment amount associated with a Medicare Advantage contract for a specific MS-DRG. These amounts generally do not tie directly to the actual payment received on each individual claim. Instead, the worksheet is intended to capture a standardized, discharge-weighted median negotiated amount for each applicable MS-DRG. 

CMS created Worksheet S-12 to collect MS-DRG-specific payment data for use in developing a market-based MS-DRG relative weight methodology beginning in FY 2029. Because CMS has stated that they may refine this methodology through future rulemaking before implementation, hospitals should monitor future rules and related guidance for updates.

Who must complete Worksheet S-12? 

Worksheet S-12 applies to subsection (d) hospitals, including applicable IPPS hospitals and subsection (d) Puerto Rico hospitals. The requirement does not apply to Critical Access Hospitals, inpatient psychiatric hospitals, inpatient rehabilitation hospitals, children’s hospitals, and cancer hospitals. CMS instructions also identify other limited exemptions, such as hospitals that do not negotiate payment rates and only receive non-negotiated payments, as well as hospitals paid under the Maryland Total Cost of Care Model during the model’s performance period.  

Hospitals should carefully evaluate whether they are subject to the requirement before preparing the cost report. Failure to complete the worksheet may result in the cost report being rejected, making early assessment and data preparation important. 

Core data needed to complete Worksheet S-12 

  • The hospital’s most recent Hospital Price Transparency Machine-Readable File (MRF) as of the hospital’s cost report filing date, which should include MAO payer-specific negotiated charges 
  • Detailed inpatient discharge data from the hospital’s Electronic Medical Record (EMR) or patient accounting system, organized by payer, plan, and MS-DRG 
  • Identification of capitated and non-capitated Medicare Advantage plans, because capitated arrangements are excluded from the weighted median calculation but may still be needed for reconciliation and audit support 
  • MS-DRG grouping or mapping information, particularly when negotiated charges are not identified directly at the MS-DRG level and must be cross-walked from another classification system 

Why the MFRs matters 

The Hospital Price Transparency MRF is central to Worksheet S-12 because it is the source for the MAO payer-specific negotiated charges. Hospitals should confirm that their file is available, complete, and formatted in a way that allows negotiated charges to be matched to MAO plans and MS-DRGs. If the file is incomplete or difficult to use, the hospital may face significant challenges preparing the worksheet accurately and timely.

Building the discharge detail file 

The discharge detail file should be developed from the hospital’s EMR or patient accounting system and should include one line per inpatient discharge. The file should be based on discharge dates within the hospital’s fiscal year and should include inpatient bill types, such as 11x claims, while allowing the hospital to identify transfers, denied claims, outpatient accounts, and claims pending appeal. 

  • Account number or other unique discharge identifier 
  • Discharge date 
  • Discharge disposition or other indicator used to distinguish true discharges from transfers 
  • Financial class 
  • Payer plan name 
  • Payer plan code 
  • MS-DRG 
  • Capitation indicator 
  • Claim status, including indicators for denied claims, outpatient claims, and claims pending appeal 

A clean discharge detail file is essential because the weighted median calculation depends on matching each applicable Medicare Advantage discharge to the correct negotiated charge. Each discharge should appear on a single line so that the data can be sorted, filtered, reconciled, and matched consistently.

How to calculate the weighted median negotiated charge 

To calculate the weighted median Medicare Advantage payer-specific negotiated charge, the hospital should first isolate inpatient discharges associated with Medicare Advantage plans. The negotiated charge from the MFR should then be matched to each discharge based on the MAO payer and the applicable MS-DRG. If a discharge or negotiated charge is not already identified at the MS-DRG level, the hospital must perform an appropriate crosswalk or grouping process. 

  1. Assign each Medicare Advantage inpatient discharge a payer-specific negotiated charge using the MAO plan and coded MS-DRG. 
  2. If the discharge is not coded to an MS-DRG, map the applicable classification, such as an APR-DRG, to the appropriate MS-DRG for matching. 
  3. Exclude capitated discharges and other accounts that should not be included in the calculation, while retaining them as needed for reconciliation and a solid audit trail. 
  4. Sort the remaining records by MS-DRG and negotiated charge from lowest to highest. 
  5. For each MS-DRG, identify the median negotiated charge. If the number of discharges is odd, use the middle value. If the number of discharges is even, average the two middle values. 
  6. Enter the resulting median negotiated charge on Worksheet S-12 only for MS-DRGs that had applicable discharges during the fiscal year. 

How to prepare for Worksheet S-12 

Hospitals should begin preparing for Worksheet S-12 well before the cost report filing deadline.  

Key steps to take now:  

  1. Validate the hospital’s MRF. 
  2. Confirm Medicare Advantage payer mappings. 
  3. Develop a discharge-level data extract. 
  4. Identify capitated arrangements. 
  5. Test the median calculation process. 

Early preparation can help reduce filing risk, support reconciliation, and avoid last-minute issues with cost report software edits. 

Because Worksheet S-12 connects Hospital Price Transparency data, Medicare Advantage contracting information, and Medicare cost report reporting, the preparation process will likely require coordination among reimbursement, finance, revenue cycle, contracting, and information technology teams.

Key takeaways

  • Determine whether your hospital is required to complete Worksheet S-12 before beginning Medicare cost report preparation. 
  • Validate the hospital’s MRF to confirm Medicare Advantage negotiated charge data is complete and usable. 
  • Build a discharge-level data file that connects Medicare Advantage inpatient discharges to payer plans and MS-DRGs. 
  • Exclude capitated arrangements and other non-applicable accounts from the weighted median calculation while retaining support for reconciliation. 
  • Coordinate across reimbursement, finance, revenue cycle, contracting, and IT teams to reduce filing risk and support timely reporting.

About BerryDunn

BerryDunn’s healthcare reimbursement team can help hospitals prepare for Worksheet S-12 by evaluating applicability, reviewing MRF readiness, developing discharge-level data extracts, mapping Medicare Advantage plans and MS-DRGs, and creating a defensible approach to the weighted median calculation. If your organization has questions about this new Medicare cost report requirement or needs support preparing for implementation, we can help. Learn more about our team and services.

Article
CMS cost reporting Worksheet S-12: What hospitals need to know

Who this article applies to: Compliance officers, revenue integrity directors, clinical documentation improvement specialists, clinical documentation and coding auditors, and healthcare providers at healthcare facilities or medical practices. 

It may feel at times like CPT® (Current Procedural Terminology) coding never changes—until it does. The American Medical Association (AMA) annually updates the CPT code set, with main revisions becoming effective January 1, 2027. These changes often require organizations to rethink documentation, coding, workflows, education, and auditing. CPT coding updates may be sporadic and unique, but early organizational preparation can minimize disruptions.

The impacts of CPT code changes may reverberate well beyond the coding department. Significant CPT revisions can affect the productivity, coding accuracy, denial rates, reimbursement patterns, compliance monitoring, Electronic Health Record (EHR) builds, payer contract assumptions, and audit findings of coding and revenue cycle teams. Even seemingly straightforward code changes can trigger extensive downstream impacts if documentation expectations, charge capture workflows, and system configurations are misaligned. Organizations should therefore approach major CPT updates as cross-functional operational changes, rather than as isolated coding updates, and prepare early. 

One CPT change, organization-wide impact 

The upcoming 2027 obstetric coding changes provide an excellent example of the broad impact code changes can have across an organization. Beginning January 1, 2027, maternity care reporting will undergo one of its most significant changes in decades, bringing an end to the long-used global obstetric package model. The resulting increase in Evaluation and Management (E/M) service reporting will require complete and accurate documentation to support code selection.

This shift to increased E/M coding for obstetric services reinforces an important lesson that is applicable to other service lines. Major CPT revisions, such as for obstetrics, rarely involve code changes alone. In the obstetrical example, use of increased E/M coding will require documentation improvements and EHR template revision, workflow redesign, provider education, and ongoing auditing to ensure compliance with the resulting changes.

Preparation will be especially important for these code sets because many patients receiving antepartum services in 2026 may continue their maternity care into 2027, when the new reporting structure takes effect. Organizations will need to consider how visits, documentation, charge capture, payer requirements, and patient encounters that cross the implementation date will be managed. Without proactive planning, organizations put themselves at increased risk for a cascade of events beginning with incomplete documentation and inconsistent coding, leading to potential delayed claims, payer denials, and confusion among providers and revenue cycle teams. Developing clear guidance before the updated code implementation will help ensure continuity of care, accurate reporting, and a smoother operational transition. 

Six steps to prepare for CPT changes

  1. Start planning early. Identify affected specialties, workflows, payer policies, and EHR implications to allow time for meaningful education and implementation of changes. 
  2. Engage multiple departments. Build a multidisciplinary workgroup that includes coding, compliance, revenue cycle, clinical leaders, operational leaders, and information technology representatives. 
  3. Focus on documentation, not just codes. New codes often introduce new documentation requirements that all clinical staff, coders, providers, and auditors should be aware of. Perform documentation gap assessments to identify where provider education may be needed before the effective date. 
  4. Evaluate technology. Validate EHR templates, charge capture tools, coding edits, payer rules, reporting systems, and analytics dashboards prior to January 1. 
  5. Monitor performance after implementation. Conduct focused post-implementation audits of documentation, coding accuracy, denial trends, and reimbursement patterns to identify improvement opportunities and provide feedback. Use findings to provide timely feedback and make necessary adjustments.  
  6. Communicate consistently. Provide staff and colleagues with regular updates and clear guidance throughout the transition period. Having a clear point of contact gives everyone a reliable resource for questions throughout the transition. 

Plan now for upcoming CPT code changes 

Major CPT revisions rarely involve coding changes alone; rather, they prompt cascading operational changes. Successful implementations occur when coding, documentation, compliance, clinical operations, IT, and revenue cycle teams begin planning well before the effective date. Organizations that start now will be best positioned to maintain compliance, support accurate reimbursement, and minimize operational disruption when the next major CPT update arrives. Now is the time to begin. 

BerryDunn can help  

Our healthcare compliance team can help. We incorporate deep, hands-on knowledge with industry best practices to help your organization manage compliance and revenue integrity risks. Learn more about our healthcare compliance consulting team and services.

Article
Beyond the code: Preparing for the next major CPT® update

Who this applies to: Read this if you are a business owner who accepts credit card payments.

As credit card processing costs continue to rise, many businesses are looking for ways to recover these expenses without significantly affecting profitability. Surcharging, which allows a business to add a fee when a customer pays by credit card, is one option. Dual pricing, which gives customers a choice between a lower cash price and a higher card price, is a second option. Business owners must weigh each option carefully to determine what will best suit their needs.

Surcharging: What you need to know

Most states allow businesses to add a surcharge for credit card payments, provided they comply with card network rules and applicable disclosure requirements. However, surcharging is prohibited or significantly restricted in certain jurisdictions, including Connecticut, Massachusetts, Puerto Rico, and potentially Maine. Several other states, including California, Colorado, New York, Minnesota, New Jersey, Nevada, and Texas, have additional requirements or restrictions that businesses should review before implementing a surcharge. Because surcharge laws continue to evolve through legislation, regulation, and court decisions, businesses should confirm current state requirements before moving forward.

Regardless of state, several card network rules apply. Debit card transactions can never be surcharged. Any surcharge must not exceed the merchant’s actual cost of processing the transaction and is generally capped by the card networks. Businesses must also clearly disclose the surcharge before payment is completed and confirm that their Point-of-Sale (POS) system can properly distinguish between credit and debit card transactions. If your business operates in a state where surcharging is prohibited or heavily regulated, a dual-pricing model may be a viable alternative.

What is dual pricing? 

Dual pricing presents customers with two prices upfront: a lower cash price and a higher card price that reflects the cost of card acceptance. Unlike surcharging, no additional fee is added at checkout. Instead, both prices are disclosed before the customer makes a purchasing decision, allowing the customer to choose their preferred payment method. 

Dual pricing is generally permitted throughout the United States when implemented as a properly disclosed cash-discount program. Businesses should work with their processor and legal counsel to ensure compliance with applicable laws, card-brand rules, and disclosure requirements.

Best practices for dual pricing compliance 

  • Establish the card price as the posted price and offer a clearly labeled cash discount. 
  • Display both prices prominently on shelves, menus, websites, and other customer-facing materials before checkout. 
  • Use consistent signage at entrances, checkout areas, and on receipts. 
  • Ensure receipts clearly show the transaction amount and any applicable cash discount. 
  • Utilize POS software designed to support compliant dual-pricing programs. 
  • Train employees to explain the pricing structure consistently and accurately. 

Customers should always be able to understand the price they are paying and how their choice of payment method affects the final transaction amount.

Addressing rising credit card processing costs 

As credit card processing costs continue to rise, many businesses are looking for ways to manage these expenses without significantly impacting profitability. Both surcharging and dual pricing can help offset processing costs, but each approach comes with specific legal and operational requirements. The key to a successful program is transparency: customers should clearly understand their options and pricing before making a purchase. By working closely with your payment processor, reviewing applicable state laws, and communicating openly with customers, businesses can implement a compliant solution that balances cost recovery with a positive customer experience.

State laws change frequently. Please consult the most current laws for up-to-date information. 

Key takeaways

  • Compare surcharging and dual pricing before choosing a way to recover credit card processing costs. 
  • Review state laws, card network rules, and disclosure requirements before adding a credit card surcharge. 
  • Confirm that your point-of-sale system can distinguish between credit and debit card transactions. 
  • Disclose cash and card prices clearly before checkout so customers understand payment-related costs. 
  • Train employees to explain the pricing structure consistently and accurately. 

About BerryDunn 

BerryDunn’s outsourced accounting services are tailored to the volume of work you have. Whether you need extra help in your office during peak times or interim leadership support during periods of transition, we can help you. We offer the expertise of a fully staffed accounting department for short-term assignments or long-term engagements―so you can focus on your business. Learn more about our team and services.

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Surcharging vs. dual pricing: Key insights for business owners

Compliance is more than a checklist: it is the foundation of organizational success. Across Medicaid agencies, health plans, healthcare providers, and community organizations, compliance creates the structure and consistency needed to fulfill the mission, protect those served, safeguard public resources, and earn stakeholder trust.

For Medicaid agencies in particular, the importance of compliance has never been greater. As states manage increasing program complexity, evolving federal requirements, heightened program integrity expectations, and growing scrutiny from oversight entities, compliance provides a critical framework for accountability, transparency, and responsible stewardship of taxpayer dollars.

Many organizations view compliance as a regulatory requirement or cost of doing business. In reality, it provides the framework needed to operate effectively, manage risk, and achieve sustainable success. For state Medicaid agencies, this framework is especially important as they operate under continual oversight from Centers for Medicare and Medicaid Services (CMS), the Office of Inspector General (OIG), state auditors, legislatures, and other stakeholders. A strong compliance program helps agencies proactively identify risks, strengthen controls, support program integrity, and demonstrate responsible stewardship of public funds.

A football game without rules, officials, coaches, or clear expectations would quickly become chaotic. Standards, oversight, and accountability do not hinder performance; they create the structure necessary for success. To achieve their objectives, organizations need clear expectations, defined processes, and effective governance. Compliance provides that foundation.

Without it, organizations face greater risk of errors, inefficiency, fraud, waste, abuse, regulatory violations, and reputational harm. Effective compliance supports sound decision-making, promotes consistency, and creates conditions for long-term success.

Putting compliance into practice

Strong compliance programs integrate governance, risk management, communication, training, monitoring, and continuous improvement into day-to-day operations.

At its best, the compliance function is a trusted advisor helping leaders identify risks, strengthen controls, improve performance, and make informed decisions.

Organizations with mature compliance programs are often better positioned to identify risks, adapt to changes, and maintain public trust. For Medicaid agencies, effective compliance programs can also support audit readiness, strengthen oversight of contractors and providers, improve program integrity efforts, and help identify and address issues before they become findings, corrective actions, or larger program risks.

Turning compliance into action

Organizations seeking to strengthen compliance do not need to address every challenge at once. Meaningful progress begins with a few foundational steps:

  • Establish accountability. Clearly define compliance responsibilities and ensure leaders and employees understand their role in managing risk and supporting organizational objectives.
  • Document expectations. Establish written policies and procedures that provide consistent guidance, support decision-making, and promote operational consistency.
  • Foster a culture of compliance. Encourage employees to ask questions, report concerns, and view compliance as a shared responsibility.
  • Evaluate and improve. Regularly assess risks, monitor performance, and use lessons learned to strengthen processes, controls, and outcomes.

Compliance is about trust

Compliance builds confidence that public funds are used appropriately, services are delivered responsibly, and decisions are made with integrity and transparency. For Medicaid agencies, that confidence extends to beneficiaries, providers, taxpayers, legislators, federal partners, and oversight entities that rely on the agency to be responsible stewards of public resources.

That trust depends on leadership commitment and ongoing investment in oversight, training, communication, monitoring, and continuous improvement. Compliance cannot reside within a single department. It must be embedded throughout an organization.

As organizations navigate increasingly complex regulatory, operational, and financial environments, leaders should periodically step back and ask:

  • Are our compliance activities aligned with our mission and strategic goals?
  • Do we have the people, resources, expertise, and infrastructure needed to manage risk effectively?
  • Are compliance considerations integrated into decision-making across the organization?
  • Does our culture promote accountability, transparency, and continuous improvement?

The answers may reveal vulnerabilities that threaten mission success, as well as opportunities to improve outcomes, strengthen resilience, and better position the organization for the future.

The question for leaders is not whether an organization is compliant today, but whether it has the governance, oversight, and the culture necessary to remain successful tomorrow. When embedded in strategy and operations, compliance becomes a driver of organizational excellence. It transforms mission into action, principles into practice, and strategy into measurable results. Beyond the checklist, compliance enables organizations to lead with integrity, manage uncertainty with confidence, and achieve sustainable success.

The questions posed in this article are intended to start a broader conversation about how compliance supports organizational performance. Future articles will explore practical strategies for strengthening governance, managing risk, developing effective written policies and procedures, and fostering a culture of integrity and accountability. Together, these elements can help organizations move beyond compliance as an obligation and leverage it as a strategic advantage.

Key takeaways

  • Recognize compliance as the foundation for organizational success, not just a regulatory requirement or cost of doing business.
  • Use compliance to create the structure, consistency, and accountability needed to fulfill the mission and safeguard public resources.
  • Integrate governance, risk management, communication, training, monitoring, and continuous improvement into day-to-day operations.
  • Strengthen controls, audit readiness, contractor and provider oversight, and program integrity efforts before issues become findings or corrective actions.
  • Evaluate whether compliance activities are aligned with mission, strategic goals, decision-making, and the culture needed for long-term success.

BerryDunn’s Medicaid Practice Group helps Medicaid agencies improve the health and lives of individuals by empowering, inspiring, and partnering with our clients—we innovate, share deep expertise, and provide an independent perspective to resolve challenges. We are the success partner for Medicaid agencies, building healthier communities and stronger futures. Learn more about our team and services.

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Why compliance drives success at Medicaid agencies: Beyond the checklist

A modest rate increase and CMS's inquiry into PDPM case-mix growth

The Centers for Medicare and Medicaid Services (CMS) issued the FFY 2027 Skilled Nursing Facility (SNF) Prospective Payment System (PPS) Final Rule, which was published in the Federal Register on July 31, 2026.  

The rule updates SNF PPS payment rates effective from October 1, 2026, to September 30, 2027, and includes changes to the SNF Quality Reporting Program (QRP), the SNF Value-Based Purchasing (VBP) Program, and several policy initiatives that may shape future reimbursement. 

While the payment update is relatively straightforward, CMS devoted considerable attention to reviewing trends under the Patient Driven Payment Model (PDPM), signaling continued focus on coding practices and potential future payment adjustments. Providers should pay close attention to this area as CMS evaluates comments received regarding case-mix growth and potential PDPM recalibrations. 

FFY 2027 PPS rate calculations 

CMS finalized a 2.4% payment update for FFY 2027, reflecting: 

  • A 3.3% SNF market basket increase 
  • Less a 0.9 percentage-point productivity adjustment 
  • No forecast error adjustment 

CMS estimates that the aggregate impact of the payment policies in this Final Rule will result in an increase of 2.4%, or approximately $882.7 million, in Medicare Part A payments to SNFs in FFY 2027. These estimates do not include the impact of SNF Value-Based Purchasing (VBP) adjustments, which CMS estimates will reduce payments by approximately $203.6 million. The impact of the update will vary by provider based on wage index changes, geographic location, resident case mix, and facility-specific VBP performance. 

CMS projects an average payment increase of 2.4% for urban SNFs and 2.7% for rural SNFs, with a low of 0.5% for rural Mountain providers and a high of 4.6% for rural New England providers. Actual provider-level impact will vary based on wage index changes and other facility-specific factors. 

The unadjusted federal rates for FFY 2027, prior to adjustment for case-mix, are as follows:  

FFY 2027 Unadjusted Federal Rate Per Diem – Urban 

Rate Component PT  OT  SLP  Nursing NTA Non-Case-Mix
Per Diem Amount $77.46   $72.10   $28.93   $132.02   $101.87  $120.91






FFY 2027 Unadjusted Federal Rate Per Diem – Rural 

Rate Component PT  OT  SLP  Nursing NTA Non-Case-Mix
Per Diem Amount $88.30  $81.10  $36.44  $129.00 $97.33 $123.15






These rates remain subject to PDPM case-mix adjustments and facility-specific wage index adjustments.

Updated PPS Rate Calculator available

As in prior years, BerryDunn has updated its interactive PPS Rate Calculator within the BerryDunn Senior Living Portal to incorporate the FFY 2027 payment rates and wage index information to assist you with the calculation of your facility-specific PPS rates.

Access the PPS Rate Calculator. 

Please note that calculated rates do not reflect facility-specific SNF VBP adjustments. BerryDunn will update the calculator as necessary once final incentive payment multipliers become available. Meanwhile, VBP information, including the incentive payment modifier for FFY27, has been made available to providers in iQIES. We recommend reviewing data carefully and promptly, as any requests for corrections are accepted by CMS through the end of August. 

CMS focuses on PDPM case-mix growth 

The most notable policy discussion in this year's Final Rule is CMS's continued evaluation of PDPM reimbursement trends. 

CMS previously solicited stakeholder feedback through a Request for Information (RFI) regarding observed increases in certain PDPM coding elements since implementation. Examples cited by CMS include substantial increases in reporting of diagnosis codes that increase PDPM reimbursement, such as malnutrition, swallowing disorders, and depression indicators. CMS noted that these trends have occurred while certain categories of resource utilization have declined.  

The agency presented potential methodologies for measuring what it refers to as "case-mix creep" and sought stakeholder feedback regarding possible future payment adjustments. While CMS did not finalize any PDPM payment reductions in this rule, the methodology discussed in the proposed rule produced a hypothetical system-wide case-mix creep adjustment factor of 0.957, which CMS estimated could equate to a 4.3% reduction in CMIs/base rates or a 3.6% reduction in total payments. Providers should view this discussion as a clear signal that CMS is actively evaluating whether future reimbursement modifications are warranted.  

CMS did not finalize any PDPM-related payment adjustments in FFY 2027. However, organizations should continue emphasizing accurate, well-supported clinical documentation and coding practices. 

SNF QRP update  

CMS finalized several changes to the SNF Quality Reporting Program. 

Removal of COVID-19 measures 

Beginning with FFY 2028 SNF QRP reporting, CMS is removing: 

  • COVID-19 Vaccination Coverage Among Healthcare Personnel 
  • COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date 
     

CMS noted that evolving vaccination guidance and the move toward individualized clinical decision-making have reduced the usefulness of these measures for quality reporting purposes.  

Shorter data submission deadlines 

CMS finalized changes that will significantly shorten quality reporting submission timelines.  

Beginning with FFY 2029 SNF QRP reporting, providers must submit data by the 15th day of the second month following the end of each calendar quarter, approximately 45 days after quarter-end, replacing the current four-and-a-half-month submission time frame. CMS stated the change is intended to improve the timeliness of publicly reported quality information.  

All-payer MDS reporting requirement 

CMS finalized a requirement that SNFs submit MDS data for all residents receiving covered skilled services, regardless of payer, beginning with the FFY 2031 SNF QRP. This change is intended to align SNF quality reporting with other post-acute care settings and provide a broader picture of SNF quality performance. 

SNF VBP program update  

CMS finalized performance standards for FFY 2029 and FFY 2030, revised the snapshot date for two MDS-based VBP measures to align with the revised QRP submission timeline, and made technical regulatory updates.   

CMS estimates that the SNF VBP Program will result in an approximately $203.6 million reduction in aggregate payments to SNFs nationwide during FFY 2027.

Bottom line for SNFs 

The FFY 2027 Final Rule delivers a modest 2.4% payment increase. 

CMS signaled continued interest in PDPM coding trends and potential future payment refinements. At the same time, providers should begin preparing for accelerated QRP reporting timelines and eventual all-payer MDS submission requirements. 

For most organizations, the immediate next step is understanding the impact of the FFY 2027 rates on facility-specific reimbursement. BerryDunn's updated PPS Rate Calculator can help quantify that impact and support budgeting efforts for the coming fiscal year. 

If you have any questions about the Final Rule or how it might affect your facility, please contact Ashley Tkowski or Melissa Baez.

Article
Federal Fiscal Year 2027 Skilled Nursing Facility Prospective Payment System Final Rule released

Every July, the National Recreation and Park Association (NRPA) celebrates Park and Recreation Month. This year's theme, "The Power Of," highlights the power of connection, play, community, nature, belonging, and well-being. But what does that actually look like?

When we posed that question to BerryDunn's Art Thatcher and Nikki Ginger, two longtime parks and recreation professionals who now advise agencies across the country, neither started by talking about facilities, amenities, or capital projects. They talked about people.

By the end of the conversation, a different question emerged: What if the real power of parks and recreation isn't in the places themselves, but in their ability to bring people together? 

The power of connection 

We live in a world designed to make interaction optional. We can stream entertainment without leaving the couch, order dinner without speaking to anyone, and maintain friendships through text chains and social media updates. Yet people continue to flock to parks, concerts, community events, trails, and recreation programs because technology may help us communicate, but it doesn't replace the human need to connect. 

Nikki was reminded of that recently when the Chicago Park District announced plans for moveable outdoor seating, something she first saw during a trip to Paris. This simple, though surprisingly rare, feature allows visitors to pull a chair into the shade, turn it toward a friend, or arrange them into small groups. It's a small design choice, but it reflects a much larger truth. People are looking for opportunities to gather, and parks create the conditions that make those connections possible.

Art sees those opportunities everywhere. He believes parks succeed because they provide something people are increasingly missing: common ground. Walk through a park alone and most people keep to themselves. Walk with a dog, a grandchild, a soccer ball, or even an artist's sketchbook, and the entire dynamic changes. Suddenly people are smiling, asking questions, and striking up conversations.

People look for common ground, and parks create thousands of those moments every day. A soccer game, a walking trail, a community event, or a neighborhood playground may be what brings people to a space, but the relationships that form there are what give it meaning.

Throughout his career, Art has seen parks and recreation bridge generations, cultures, and neighborhoods in ways few other institutions can. As he put it, "A pool table is still a pool table whether you're 12 or 82." The activity may look simple, but it creates a rare opportunity for people of different ages and backgrounds to share an experience. The activity may be different, but the outcome is often the same: people finding a reason to connect. 

The power of play 

Play tends to get dismissed as something that belongs to children, but Art and Nikki would strongly disagree. 

In fact, many of life's most important lessons are learned through recreation. Board games teach strategy and problem solving. Team sports teach collaboration and resilience. Friendly competition teaches us how to win graciously and lose gracefully. 

Art laughed as he described a household rule while raising his children in a highly competitive family: "The first one to cry goes to bed." Behind the humor, though, was a serious point. Play gives people a safe environment to experiment, learn, fail, adapt, and grow. The lessons may begin on a playing field or around a game board, but they often carry into school, work, relationships, and everyday life. 

Play also has a unique ability to bridge divides. Art pointed to the World Cup as a perfect example. Fans from around the globe gather around a shared love of the game, setting aside cultural differences and preconceived notions. Visitors discover that communities are often more welcoming than expected. Residents discover they have more in common with people from different backgrounds than they realized. For a few hours, politics, geography, and stereotypes take a back seat to a shared experience. 

For Nikki, play is also closely tied to wellness and longevity. She pointed to research on Blue Zone communities, where people regularly live longer, healthier lives than average. One of the common threads is meaningful engagement with family, friends, and community. Recreation often provides the vehicle for those interactions, creating opportunities for people to stay active, involved, and connected across generations. 

She's seen that firsthand in her own family. When conversations begin heading into uncomfortable territory, Nikki has a simple solution: bring out a game. Almost immediately, the conversation changes. People stop focusing on their differences and start focusing on a shared experience. The atmosphere lightens. Everyone reconnects. It goes beyond being a distraction from real life. It can actually be the catalyst for helping us navigate real life. 

The power of community 

One theme surfaced repeatedly throughout our conversation: people want to be together. 

The growing popularity of community events proves it. Movie nights in the park, outdoor concerts, food truck festivals, and community celebrations continue to draw strong participation, even though people could enjoy the same entertainment from the comfort of home. That's because the attraction isn't really the movie, the concert, or even the food; it's the shared experience. 

As Nikki put it, people want to gather. Sometimes they just need an excuse.  

Art shared a similar story. When a friend's son was in town playing baseball, a simple invitation went out to a small group of friends. By game time, nearly twenty people had shown up. The baseball game gave them a reason to gather, but seeing one another was what made the evening memorable.

That ability to create community is why Art still remembers something a city manager told him decades ago: 

"You are my feel-good department." While police departments respond to emergencies and public works departments maintain infrastructure, parks and recreation creates experiences people look forward to. It creates moments of joy, celebration, connection, and belonging that shape how people experience their community. 

In a world where so many conversations focus on what's broken, parks and recreation offers something different: opportunities to build relationships, create memories, and strengthen the ties that make communities feel like home. 

The power of nature and belonging 

If the pandemic taught communities anything, it was that access to nature isn't a luxury. It's essential. 

Both Art and Nikki have watched communities rediscover the value of trails, open spaces, neighborhood parks, and outdoor recreation over the past several years. During COVID, people sought refuge outdoors. What many discovered was that these spaces offered far more than recreation. They offered relief, connection, perspective, and resilience. 

The renewed appreciation for outdoor spaces has led to another shift that Art sees in communities across the country. For years, many communities poured resources into destination facilities and large sports complexes. Today, residents increasingly ask for something much simpler: a quality park close to home. 

They want a place to walk with their families, sit under a tree, read a book, or simply spend time outside. They want a place where neighbors recognize one another and where the community feels accessible, familiar, and welcoming. 

In short, they want a place that feels like theirs. As Art noted, if you want to see how much people value a park, tell them it's going away. 

Residents who haven't visited in months will show up at meetings to defend it. Not because they're thinking about a playground or a walking path, but because they're thinking about what that place represents. It's part of their identity, their neighborhood, and their community. 

Common ground 

Throughout our conversation, Art and Nikki kept returning to the same idea, even when they were answering completely different questions. Whether they were talking about play, nature, community events, or neighborhood parks, the underlying value was remarkably similar: Parks and recreation creates common ground. 

A soccer game is a universal language that requires no translation, no matter where in the world you are. A community concert gives friends a reason to gather. A walking trail creates chance encounters. A neighborhood park becomes part of a community's shared identity. 

In a time when people often feel isolated, stressed, or divided, parks and recreation provides something increasingly valuable: opportunities to show up, share an experience, and connect with one another. That's what Nikki sees in crowded movie nights, multigenerational programs, and communities rallying around the spaces they love. It's what Art has seen throughout a career spent helping communities build places where relationships can grow. 

The parks may bring people in. The programs may get them involved. But the real power of parks and recreation lies in what happens next: the conversation that starts on a walking trail, the friendship that forms at a community event, the neighbors who become connected through a shared place. 

Sometimes all it takes is a little common ground to turn a space into a community. 

Innovative strategies for parks, recreation, and libraries 

BerryDunn's consultants work with you to improve operations, drive innovation, identify improvements to services based on community need, and elevate your brand and image―all from the perspective of our team’s combined 100 years of hands-on experience. We provide practical park solutions, recreation expertise, and library consulting. Learn more about our services and team.  


 

Article
What Is the Real Power of Parks and Recreation?