Healthcare systems can lose funds when potential invoice discrepancies aren’t investigated in a timely manner.
In a recent Accounts Payable recovery audit TAG reviewed invoices spanning three years for a Northeastern U.S. healthcare system. We identified potential overcharges of approximately $71,900 by a large medical products distributor. At the time, some of the potential overcharges were almost four years old.
The distributor refused to research invoices and payments prior to that year, which resulted in significantly fewer potential fund recoveries for the healthcare system. However, the vendor offered a partial settlement for the potential overcharges.
In total, the distributor proposed a payment of $38,000 to the healthcare system to settle the overcharge issue. The healthcare system accepted the settlement and not push for the balance of funds. But, it potentially lost 47% of the overcharges that we identified.
If you’ve run across discrepancies on invoices, be sure your Accounts Payable department follows up with your vendors quickly. To avoid lost funds, follow these tips:
At The Audit Group, we help hospitals and complex health systems across the nation to identify financial waste in their Accounts Payable and Supply Chain operations. Get in touch to learn more about how our team can recover lost funds and, more importantly, analyze error root causes and recommend corrective actions to prevent future losses.