How to get extra mileage out of your healthcare budget (for hospitals)

article from Nvoicepay.com

Squeezing those last all-important dollars out of a healthcare budget is a game that hospitals are never done playing. It's no secret that hospital administrators must cut costs to adapt to the current healthcare environment ahead of changing government regulations.

But what if there was a better strategy than cutting dollars you don't even have to spend?

Consolidation is triggering an automation overhaul

The rash of mergers following the Affordable Care Act changed the criteria for hospital reimbursements to favor a value-based care approach. This means that the patient experience carries more weight than the number of overall services received. This has weaved significant changes into the fabric of healthcare.

For example, many hospitals are looking to automate their supply chains as a way of cinching their purse strings after mergers have uncovered decentralized and inefficient ways of managing product, costing hospitals billions of dollars annually in unused or expired products.

A Cardinal Health Survey of 150 supply chain leaders estimates that $5 billion is wasted in high-value medial devices each year. As mergers and acquisitions trigger an avalanche of consolidation efforts, hospital administrators are bound to stumble upon an equally troubling automation gap in medical back offices.

Cleaning up the back office is a win-win

Unpaid supplier invoices lie in stacks. The fax machine buzzes with more work to do. Emails ping with updated supplier information to add to the Master Vendor File. Piles of patient reimbursement paperwork equates to a never-ending to-do list. In stark contrast to the innovative technology offered at the point of care in most hospitals emergency rooms and intensive care units, the back office is stuck with archaic processes in an outdated paper-based landscape.

And while what's going on behind the scenes might seem insignificant so long as patients are receiving adequate care, the pace at which healthcare is changing as an industry requires staying lean now more than ever.

High processing costs, late payments, and missed discounts were the three highest ranked complaints of modern healthcare AP departments, as revealed in a 2016 Paystream Advisor's ePayables for Healthcare Report.

Scale to stay afloat

Where an organization can cut costs and speed up efficiency, it absolutely should, and here's why: the hospital that scales is the hospital that stays afloat. Keeping pace with the demands of healthcare requires a back office that can pivot quickly and conserve resources that are needed in more urgent areas.

When back office payment processes are empowered with electronic solutions, patient reimbursements are sent quicker. Contracting physicians receive electronic payments faster instead of waiting for a check from the hospital to arrive in the mail. Staff is less prone to making errors when cutting supplier checks. Patient care is elevated when key vendor relationships remain stable and predictable as a result of payment automation.

The truth is, manual processing is archaic and inefficient and increased regulations have made it difficult to process healthcare payments with so many compliance issues and legacy systems mired in paper. There is a way to sidestep the regulation nightmare, but most healthcare systems are just waking up to it.

Sidestep compliance nightmares

A cloud-based payment solution that consolidates multiple payment types into a single workflow is exactly the kind of thing that will rescue hospital AP staff from an endless influx of patient reimbursements and vendor payments.

Not to mention, navigating compliance issues with sensitive supplier data can be a bit of a black hole. Why manage it yourself? What will truly save your hospital time and cost savings is automating the burden of supplier data management. With the host of cloud-based solutions available, this means you wont have to sink months into tangled integrations, ensuring that a payments provider will play nice with your ERP solution.

Think of cloud-based software as more of an add-on that will help your payments move faster, without requiring a lot of time or investment from IT. And while payment automation can't solve everything that ails the healthcare industry, it can help pull back the curtain on areas where hospitals are spending too much to maintain processes that are error-prone and slow. You can get more mileage out of your existing budget if you know the right places to invest, and to cut wasted spending.