The healthcare industry is changing gradually from volume-based care to value-based care. This change necessitates all healthcare departments to increase their efficiency and cut costs. Among the departments that require significant modifications to reduce costs and improve efficiency is the Accounts Payable (AP) department. The best way for AP departments to trim down expenses is by implementing health care AP automation. Health care AP automation helps health institutions manage AP payments with little effort. It has benefits for both health care organizations and their suppliers. Below are the top seven benefits of AP automation in health care.
1. Cut Costs
Health care AP automation is an excellent tool for cost saving in accounting departments, and hence improving an organization’s bottom line. It cuts paper volume as invoice processing goes electronic. The huge sums of money companies spend on paper are directed towards improving patient outcomes. AP processing costs go down substantially as well as bank fees. In addition, organizations avert the costs associated with human errors. It is estimated that AP automation reduces costs by up to 50%.
2. Improved Decision Making
With accounts payable solutions like iPayables, healthcare decision makers have vast amounts of data to use in forecasting that aid them in making shrewd decisions. Accountants and other business leaders have high visibility in the payment process and can identify problems and areas that require improvement. Also, they get insights into the performance and productivity of the AP team. AP automation also enhances transparency and auditing becomes easier.
3. Enhance Efficiency
Manual invoice processing brings much inefficiency to the AP departments. AP professionals spend a lot of time and effort handling paper invoices, chasing approvals, and making payments.
Additionally, the lengthy payment processing time results in high processing costs. Manual invoices are also vulnerable to loss, human errors, and unauthorized access. AP automation solves all these problems and increases the efficiency and operation of AP departments. It also increases employee productivity. Professionals no longer spend hundreds of hours processing invoices manually and spend more time in high-value tasks.
4. Eradicate Errors
As opposed to manual invoice processing that is error-prone, AP automation eradicates errors. In some instances, a small mistake in value or billing code can be costly for an organization and result in substantial financial losses.
5. Faster Approvals and Payments
AP automation offers more control over the approval and payment process. Payments are faster and AP professionals take advantage of early payment discounts and avoid late payment penalties. With timely payments, healthy and long-term relationships develop between health organizations and suppliers. Also, AP automation reduces cases of overpayments and duplicate payments that increase costs for hospitals.
6. Ensure Compliance
AP automation ensures compliance with regulatory requirements such as SOX and FASB. Also, payments have to comply with organizational policies. For example, if an organization requires each payment to be authorized by three superiors, no payment can be made without this requirement being met. This way, health institutions get rid of the costs associated with compliance. iPayables offers encryption and other mechanisms for data protection to help with security and compliance.
7. Benefit for Suppliers
AP automation not only has advantages for healthcare organizations but also suppliers. Suppliers get better visibility into contracts, conduct correct financial forecasts, and optimize payments. Additionally, suppliers no longer have to bear the burden of manual processes and hence divert their attention to more productive roles.
Manual invoice processing is inefficient, error-prone, time-consuming, and costly. Therefore, AP departments need to adopt account payable solutions like iPayables AP automation to address all these shortcomings. Health care AP automation has positive outcomes for reduced costs, improved efficiency, less mistakes, and compliance with payment policies. It delivers great value for hospitals, and you channel more resources to improving patient care.