Healthcare systems have hundreds of individual contracts and pricing agreements to manage during any given billing cycle. Despite the best efforts of purchasing and pharmacy departments, difficulties often arise in ensuring accurate prices are paid for on all products and services. Contract overcharges, discrepancies between PO and invoice terms, duplicate vendor payments and other issues are common among health systems without proper payment processes in place.
To ensure your health system is paying the correct amount for every order involves following a three-step process:
The Audit Group recently encountered a health system that was overcharged $13,800 by Medline for ICU Medical items purchased on contract #MMS0032. Before this billing cycle, the health system had been paying the contract price of $112.50 on a specific item until July 2017, when a “new,” higher price was established and the item price increased to $158.50. Because the health system did not have a correct payment process in place, the Accounts Payable department paid the incorrect pricing without researching why the price differed from the PO.
The health system continued paying the increased price until the auditing team at TAG relinked the item to contract #MMS00326. TAG contacted the vendor and Medline agreed to adjust the item price to reflect the contract and credit the system with $13,800.
If your healthcare system is plagued with payment discrepancies and overcharges, it’s time to consider implementing your own correct payment process. The experts at TAG specializes in evaluating your organization’s payment system to improve your processes without losing any productivity. Contact us today to learn more.