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November 18, 2021
Returning unused or unwanted products at your health system is unavoidable making a well-defined returned goods process an essential asset. Industry-leading returns processes directly reduce millions of dollars in exposure to risk– $7M annually at health systems in the USA*. No health systems are alike making it difficult to design a one process fits all approach to the industry’s returned goods issue. However, there are several elements that are critical in a successful returns process including: Interdepartmental communication and accountability Clearly defined responsibilities and policies Ownership, accountability, and oversight Leveraged Technology such as a returned goods log Reconciliation Tracking of […]
September 13, 2020
Manufacturing medical devices in the US is $47B a year industry with implantable devices accounting for $26.75B. With revenue values this high accounting for essential life-saving equipment, it is important for healthcare system leaders to understand the true or total cost of ownership. This not only means the original purchase of the devices but also takes into account equipment warranties. Afterall, warranties exist to mitigate the risks related to ownership and help create vendor reliability. However, the healthcare industry as a whole continues to struggle to manage their warranties, especially when it comes to implantable devices. Getting greater insight into […]
June 9, 2020
Healthcare systems return an average of 4% of the products they purchase each year. Of that amount, 7% of the amount returned never gets credited back by the vendors totaling a loss of $700,000,000 annually.*no-repeat;left top;;auto in returned goods credits lost each year$700Mvertical Why does the Returned Goods Process Lose Millions? The returned goods process is an incredibly important area, spanning multiple departments of every health system. In theory, it is a relatively simple concept – return unused products and get your money back. However, the repercussions of mismanaging the process are significant. Organizations that mismanage their returned goods processes […]
May 3, 2018
Managing Returned Goods in Healthcare Systems An ineffective or incomplete returned goods process can cost a large hospital or healthcare system hundreds of thousands of dollars just over a couple of years. In TAG Discovery Reviews with healthcare clients, returned goods credits typically compose the largest or second-largest category of fund recoveries. In one major metropolitan healthcare system, recoveries from returned goods were 36% of the total from the recovery audit. In another, they were 40% of the total recovered. In a third example, recoveries were 52% of all collected funds. These audits results were not unusual: They covered two-year […]
January 23, 2018
When a hospital is purchasing new equipment, they will trade in their old equipment at the same time. Financially, it makes sense to trade items when the organization will no longer have use for the outdated equipment, and trading in can often cut some of the cost of new equipment. Your Accounts Payable department should track trade-in items to ensure accuracy. Oftentimes, items traded in during the purchase of new equipment are not tracked properly by the hospital’s Accounts Payable department. When trade-in items are not documented correctly, vendor mistakes can occur, such as not crediting the item’s value to […]
October 19, 2017
One of the largest areas of claims recovered from an audit of a major healthcare system is Returned Goods. Effective returned goods processes are necessary to properly account for all return credits owed to a hospital. A successful returned goods process starts with knowing what to document when making a return and knowing when to follow up with vendors. If no returned goods process is in place or you are not accurately documenting your returns, you could be leaving money on the table. TAG Develops Returned Goods Process for Major Health System In a recent process review, The Audit Group […]
