Whitepaper: If It Ain't Broke, Fix It
This whitepaper provides background information on the industry, highlights the increasing margin pressure, and identifies an innovative approach to reducing SG&A costs. Fill out the form to read more!
A confluence of factors is motivating ambulatory surgery centers (ASC) to seek opportunities to reduce their costs and enhance staff efficiency. These developments include the ongoing labor shortage and increased competition for qualified staff, tightening reimbursement, and rising supply expenses. A highly effective opportunity for ASCs to achieve improvement goals can be found in an often-untapped area of operations: payment processes. The antiquated ways surgery centers pay for equipment and services can contribute greatly to excessive administrative costs that eat into the bottom line.
Fortunately, technology has come onto the market that is allowing surgery centers to move away from manual and labor-intensive payment processes that are hampering a center’s ability to make the investments necessary to remain competitive and grow. Here are seven of the ways technology is supporting ASC efforts to transform their payment processes.
Payment automation has become commonplace in many industries. Consumers use automation to pay for everything from mortgages, to utility bills, to cell phone services, to streaming services, to credit card bills. Automation is also helping people to take advantage of discounts associated with payment automation, with Amazon’s “Subscribe & Save” option as one of the most notable.
Such automation functionality is now available to ASCs to use for product and service vendors. As surgery centers ramp up their use of payment automation, they achieve significant benefits. Perhaps the most important is that automation helps an ASC better ensure it has the products in inventory needed to perform scheduled procedures. Vendors that know a center is automating payments can more confidently allocate the quantity of product or people (for a service) an ASC needs since it knows payment is already scheduled.
By moving to automated payments that commit an ASC to ongoing purchases, centers are also putting themselves in better positions to engage vendor partners in discussions about costs savings or other benefits that may be associated with “preferred purchasing” status.
Technology is allowing ASCs to greatly reduce the amount of manual payment data entry staff must complete. At a time when surgery centers are facing increased labor costs and many ASCs are struggling with staff shortages and turnover, technology is helping centers to get their work done while reducing staff workloads.
By switching from manual to automatic data entry, centers also negate a wide range of problematic issues. Relying on staff to enter payment data into a system will inevitably lead to more errors than automating this entry. Contributing factors include fatigue, distractions and poor handwriting. Payment data entry errors can lead to a slew of problems for ASCs — especially when that data is needed to guide significant decisions, must be reported (e.g., taxes) or be used for key processes like case costing and benchmarking. Manual data entry is time-consuming and expensive — and growing more expensive as staffing costs continue rise. Manual data entry can also contribute to staff dissatisfaction due to its tedious and repetitive nature.
Thanks to technology, ASCs are reaping the benefits of better controlling and executing when they initiate payments for products and services. Among the benefits: avoiding late fees, taking advantage of prompt-payment discounts and holding on to cash for longer to maximize interest. In addition, timely payments can also strengthen a surgery center’s relationships with its vendor partners.
Effective operation of an ASC requires a center to enter into many contracts. These tend to include utilities, housekeeping, linen and uniform rental and cleaning, HVAC service, equipment maintenance and repairs, and medical gas. On top of these contracts, ASCs may contract for coding and billing, IT services, staff training, consulting and other outsourced and supporting services.
The more contracts, the more difficult it can be to keep track of the terms of these contracts, including what and when an ASC needs to pay for products and services. Technology is greatly helping alleviate the work and better ensuring surgery centers consistently follow the terms and make appropriate payments. As a result, ASCs are avoiding overcharges and inaccurate payments and the headaches and penalties associated with violating contract terms.
It’s important for ASCs to know exactly how much they spend on a service or supply. This information can serve multiple purposes, including case costing, identifying areas for growth, determining cost-cutting initiatives and undertaking benchmarking.
But determining an exact cost figure can be easier said than done. There’s the price the ASC pays for a service or supply, i.e., the “price at the pump.” Then there are many potential additional costs or discounts that should be understood to determine the “true” cost, such as financing fees; prompt pay, bulk purchasing and bundling discounts; overdue payment fees; and return and exchange fees. Technology is helping surgery centers to better identify these costs and discounts and then factor them into the purchase price so they can calculate true costs and use this to make more optimized, data-driven decisions.
Speaking of data-driven decisions, this is another way technology is helping ASCs that’s worth highlighting on its own. More extensive, complete, and accurate payment data, captured and presented through technology, is allowing surgery centers to drill further down into their metrics to find noteworthy trends and high-impact opportunities for improvement.
As ASCs grow more reliant on their data and analytics to guide the significant decisions that will support efforts to grow, it’s imperative that center leaders be confident that the data they are reviewing and using is accurate. With technology, surgery centers can perform ongoing payment audits that provide increased transparency into their data. This puts ASCs in a position to more effectively recognize discrepancies and quality issues, understand and bolster processes, and support a more rapid response to vulnerabilities. The ease that technology is helping ASCs perform auditing is leading to enhanced data quality that ultimately enables centers to achieve the improvements necessary to remain viable and competitive.
While payment processes have not typically been viewed as an area where improvements could be a difference-maker for ASCs, technology has changed this narrative. Solutions are now available to surgery centers that are enabling them to achieve the types of payment and process improvements that can make a significant financial and operational difference.
The innovative, intuitive, and intelligent triValence solution simplifies the ASC infrastructure, making it possible for surgery centers to strengthen their payment processes in ways that are leading to transformative changes.
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