The Top Five Things I’ve Learned (so far) at the 2022 Trade Shows

SpendMend Team

By Alan Brander

We’re almost halfway through June (can you believe it?) and the SpendMend team has been busy traversing the map and meeting clients and colleagues at trade shows and industry conferences across the country.

At this point in the year our team has already attended ten separate trade shows and I estimate we’ve had hundreds of meaningful conversations with clients and other industry experts.

A few patterns are beginning to come into focus, and I wanted to spend a moment to lay out my top 5 things I’ve learned so far at the 2022 trade shows.

  • We’re ready to mingle. One thing is for sure… we’ve all been cooped up long enough and although some of us already started returning to shows in 2021 – most of us have not.  Being out on the conference floor and among peers is a welcome relief from working from home and spending countless hours on video calls.
  • The emphasis on “Cautiously.” I’d say, for the most part, the colleagues and peers I’ve been meeting with are fairly optimistic about the market and supply chains, and COVID-19 cases getting better.  Many people acknowledge that we are in the middle of a downturn, but there seems to be a sense of cautious optimism.
  • Dance cards are full. The past few shows have been like nothing I’ve seen in the past.  I am a 30-year veteran of the healthcare industry and I spent most of my career serving on the healthcare provider side.  My most recent hospital gig was as a Chief Nursing Officer where I was responsible for 2 hospitals.  Nowadays, I attend conferences as a service provider, in that new capacity I’ve gotten used to working a little harder to get the attention of VPs and C-level officers.  So far, this year has been different, I find that the hospitals are seeking us  I barely leave the booth and there is often a line of people queuing up to talk with us.
  • Cost savings, cost savings, cost savings… There are many things on the minds of hospital leaders at present. Supply Chain, Data Security, COVID-19, Nursing shortages, and more.  All that said, the most common pain point that we observed was in the area of cost savings.  Or more to the point – hospitals and healthcare systems are asking, how can I get better visibility into: What I am spending? How can I spend more intelligently? How do I avoid profit loss? How do I negotiate better terms? What cost metrics should I be tracking… and on, and on.  They used to say, “Cash is King.” Right now, I feel like “Costs are paramount!”
  • There simply isn’t enough time. As we return back to a semblance of normalcy, I see hospital leadership with much longer “to-do lists” than ever before – with the same number of hours in the day to do it all. The world has become more complicated so there has been an increase in new initiatives.  At the same time, the hospitals are still obligated to maintain their usual operations and add to that there is a daunting backlog of items that have been ignored since March of 2020.  Leaders throughout the healthcare industry are working overtime to balance all these different sets of priorities and trying to settle on… what are the real

So that’s my Top 5 list for the time being, but we still have another 7 shows on our calendar for the balance of the year.

I’ll check in again in six months to tell you how everything turns out!

What Makes a Best-in-Class Recovery Audit Firm in Healthcare?

SpendMend Team

Written By; David Hewitt, RVP of Sales – East

What are the basics for a Recovery Audit provider?

At minimum your Recovery Audit firm should be checking all the following boxes.

  • Working offsite/Remote access
  • Online claims delivery
  • Data files (AP, Vendor Master, PO, Receipt)
  • Data security
  • Healthcare experience
  • No initial investment to get started

What are the attributes of a Best-in-Class Recovery Audit firm?

It is not enough to settle for a firm that simply checks the boxes.  The following list outlines the attributes you should look for in a best-in-class Recovery Audit provider to ensure the best results and the highest levels of partnership.

  • Strong data security — ¬Provider should demonstrate strong security measures including encrypted data, SSAE16 Secured Data Centers, HIPAA Trained
  • Industry expertise and benchmarking — Healthcare is a unique industry, and your Recovery Audit provider should demonstrate deep expertise.  A few of the insights they should provide are as follows:

o    What are your healthcare peers doing to address issues like yours?
o    How do you compare to other healthcare systems?
o    Best practices to patch gaps leading to financial leakage
o    Proven industry methods for driving cost-saving efficiencies

  • Insights and visibility — Provider should offer meaningful root-cause analysis and recommendations. Some of the key insights should include:

o    A listing of which suppliers (and staff) are not complying with processes
o    A clear understanding of why and where dollars are falling out of the process
o    Strong recommendations for how to positively impact the problem
o    A focus on corrections and not collections

  • Cost-savings opportunities — As a result of the audit, you should gain a clear outline of where to save dollars in your annual spend that are not simply related to recovery.
  • An up-to-date scope.  Your best audit results will come from a scope that hovers around 90-days and provides real-time feed back.
  • RNI, INR Reconciliation — Your audit should support the RNI (receipt not invoiced) and INR (invoiced not received) reconciliation.  This is critical for healthcare.
  • Additional services — Ensure your provider has other solutions beyond Recovery Audit otherwise they will not be incentivized to help you fix your problems.
  • A healthy vendor database — Provider should have an up-to-date database of suppliers to help clean your vendor file and to aid in outreach to suppliers.
  • A strong partner ecosystem — Provider should be connected to other industry providers to help gain a wider view into how to fix your network’s larger issues.
  • A client portal — Claims should be delivered through an online portal with claim upload capabilities, drill down capabilities, in-depth reporting, communication, ease of use and 100% claim administration.
  • A full-time staff — Your auditors should be a team of full-time employees that are paid a salary or hourly wage to ensure they are consistently auditing all ranks of your vendor file and AP transactions history without competing incentives or prejudice.

For more information regarding the benefits of using a Recovery Audit to help boost your hospital’s bottom-line or to drive new insights and visibility into your cost-cycle, contact SpendMend today.

Caring and Preparing – A Challenge Unique to Healthcare

SpendMend Team

Written By: Michael Koory, RVP of Sales- Mid America

To all people working in healthcare – Thank you!

Recently, I read an article and listened to some audio relating to PWC’s recent survey on what is keeping CFO’s up at night amidst COVID-19

Find the link here: https://www.pwc.com/us/en/cfodirect/multimedia/podcasts/covid-19-pwc-cfo-survey-findings.html

The survey included several non-healthcare industries, but I could not help but recognize how applicable all this is for our healthcare clients as well. I am struck by how much this parallels the recent strategy conversations I’ve had with a few major GPO’s and U.S. hospitals about post-COVID-19 planning.

 

The key bullet points from the article and podcast were:

  • Liquidity & Cost Savings
  • Workforce Issues
  • Government Programs (CARES Act)

From my perspective, these strategies reflect steps I am seeing health system executives undertake to minimize losses and begin to find a way forward. Healthcare providers have a more difficult job since they are on the front line caring for patients while trying to re-orient their budgets and revenue plans for 2020.

It is during times of crisis and disaster we realize what a gift it is to have a healthcare community like we do in the United States. After the initial shock of mobilization to prepare for an onslaught of patients, finance and supply chain leaders quickly began to pivot toward stabilization and optimization. Simultaneously caring and preparing for the massive impact this crisis will have on the healthcare system.

 

Liquidity & Cost Savings

As soon as elective surgeries were canceled and shelter in place orders placed, health system providers absorbed a massive revenue hit. Layoffs in the healthcare market were a leading indicator of what would follow for other businesses in the United States. As of April 22, Becker’s Healthcare is reporting layoffs at 171 health systems across the United States. Adding to the challenge, some of these layoffs are occurring in COVID-19 hotspots like Detroit and New York.

With the topline revenues cut due in part to the loss of elective surgeries, leading executives are looking for cost-cutting strategies to protect their bottom line. In the past week, we have seen a spike in interest for our Recovery Audit services from our GPO partners and leading health systems.

Beyond the fast influx of cash (25 days on average), the best reason to implement this strategy is the increased visibility into the supply chain costs. The increase of purchases of Personal Protective Equipment and other pandemic preparedness items create the opportunity for pricing issues and duplicate payments. The increase in visibility offers healthcare leaders greater control over the entire supply chain and creates a position of strength when negotiating with vendors.

 

Workforce Issues

SpendMend deploys our workforce remotely to preserve our health and that of our community. Many of our clients have been dealing with setting up remote work operations for the administrative teams in the health system. It can be challenging to manage a remote workforce, but undoubtedly it will be more common as we move into our new normal.

One of the challenges with remote teams is communication. Team leaders need to begin thinking about information sharing and communication in a remote environment. Also, policies for remote work and data security need to be set up or updated. We could see a net increase in productivity by enhancing the remote work capabilities of administrative teams.

 

Government Programs (CARES Act)

The CARES Act has provisions that add $100 billion to the Public Health and Social Services Emergency Fund. Eligible healthcare systems can seek reimbursement for lost revenues and healthcare-related expenses incurred due to COVID-19. There are also accelerated and advance payment programs within the CARES Act. These funds are intended to supply a bridge between any disruption between claims submission and claims processes. These provisions will need the ability to account for the costs and track the available payments. Not an easy task while trying to battle the virus as well.

There are many challenges seen and unseen associated with this current crisis. At SpendMend, we are continually amazed by the innovation and desire to serve within the United States health systems. Our mission is to stand with our clients and help drive cost savings back to their organization to fund patient care.

What Did 100 Healthcare Professionals at the AHRMM Conference Teach Us About Goal-Setting for the Balance of 2019?

SpendMend Team

By: Tom Flynn, VP of Marketing, tfylnn@spendmend.com

Earlier this month we piled 5 of our most prized employees into a booth at the The Association for Health Care Resource & Materials Management (AHRMM) conference in San Diego, California.  We had so much fun that it hardly even felt like work!!  It was very hard to leave after four straight days of 80-degree weather without a cloud in the sky.  But even more impressive than the idyllic Southern California climate was the superb show and hospitality from the AHRMM association.  We felt the quality of the event, the venue, and the accommodations were all top notch. We’re already excited about attending next year.

The show curriculum was stellar; the only problem was that there were too many great options and the packed schedule forced me to, at times, pick one session over another when I would have preferred to attend both.  A topic of particular interest was the growing discussion about Cost, Quality and Outcome.  Or “CQO” for the initiated.   This is not a new concept, but the dialogue around this discussion seemed to hit a new gear at this show. I was particularly appreciative of AHRMM president Bob Taylor’s opening speech about “CQO.”  In short, the focus on cost and quality are not new, but the honest discipline of ensuring “outcome” is just an awesome discussion.

There were too many great topics and we will try to cover them in some forthcoming blogs, but for now we wanted to talk about an interesting bit of insight we were able to glean outside of the show’s scheduled sessions and from the attendees themselves.

We took part in the “Passport” promotion where attendees were asked to stop by a handful of select booths and answer a spotlight question so that they could receive a stamp in pursuit of a very cool prize.  We set up our booth so attendees would have to answer a question top priorities or initiatives for the remainder of 2019.  The results were revealing to say the least.

In total, we probably spoke to about 100 people on the topic. We heard a wide range of initiatives and priorities.  I’ll share some of the most common responses below:

For the balance of the year, some of the AHRMM conference attendees are managing through personnel-type issues, such as: department re-orgs, management changes.  We heard a little bit of that.  There wasn’t much of it, but it was interesting how emotional that topic always seemed to be as compared to some of the other topics.  As much as we are all representing big healthcare systems, at the end of the day we are all just people.

Some of the attendees were also dealing with software changes.  And by that, I mean, upgrades and installations of different systems.  My heart when out to two different companies that were BOTH scheduled to go live on the same ERP in the next year.  They were both super stressed and unsure of how they were going to find the time. That said, I was thrilled that they could make the connection to each other and they exchanged information and promised to help each other through the process.  Ideally, that is how these shows are supposed to work!

Some of the show attendees are also dealing with either a merger or a divestiture.  I was surprised to hear that came up a lot and it was a source of a lot of anxiety for the departments that are going through it.

A few of the attendees mentioned that they are trying to increase spend through their GPO.  I expected to hear more of that, but it was only an area of concern for a few.

One attendee told me, among many things, she was trying to source larger gowns for patients.  I don’t why, but the show was two weeks ago and that one really stuck with me.

But… without a doubt… the one initiative that we all heard time and time again was “Cost Savings,” “Cost Containment,” “Cost Cutting,” or words to that effect.  The most interesting way that somebody said it was that they were trying to “put an end to all the financial waste!”  He was very funny and dramatic.

Of the 100 people we spoke to, at least 80 of them had “costs” somewhere in their answer.  I’m not sure I have the perfect conclusion for why everyone almost universally called out “costs” when we discussed their year-end initiatives and priority, but I am convinced this is the hot button issue…

So I ask you…  Is it that obvious?  Is cost containment ALWAYS at the top of the list and all the other initiatives just sort of orbit around it and fall into line based on resource availability or some other factor?  I work closely with a co-worker at SpendMend that spent 20-years of his career running an O.R. and he said he wasn’t surprised at all by our survey results.  He said, if you would have asked him this question 20 years ago, he would have either said inventory management or controlling costs.  So, I guess it’s been this way for a while.

At any rate, I found the promotion to be enlightening and it helped us meet a ton of really interesting people.  (Just like the AHRMM show itself) I should also add that we did NOT approach this promotion as a sales vehicle, at all.  We just wanted to meet people, talk about their environment, and get a feel for their priorities.  It was a good bit of research for us and we are planning to put it into a more formal report in partnership with one of our GPO partners.

But…  if this resonates with you, I should at least add that our entire solution suite is geared toward assessing and correcting financial leakage in healthcare.  We’ve done it for 25 years and we’ve worked with over 250 or the nation’s top 400 health systems. If you are also one of the people who would identify “cost containment” as a near or long-term goal…  please consider letting us help you assess your environment.  This is a topic we are passionate about and over the last two decades we have seen so many environments that even if you never work with us you can always learn from our insights an assessments.  We’d always love to partner with you on a project like that.

Financial Leakage Sneaks into Supply Chain

SpendMend Team

Financial Leakage Sneaks into Supply Chain

Financial Leakage can find its way into Supply Chain in a variety of ways, but a lack of time, insufficient data, expired, returned, and recalled items, as well as cost management, can plague an entire department.

 

  • Lack of Time – A SpendMend 2018 survey showed that the average Supply Chain Professional spends 2.5 hours per day on tasks outside of their daily assigned tasks. That adds up quickly over a week which is 12.5 hours, 78 workdays, or 30% of your total working year on other tasks. These tasks could be due to training, inadequate systems, understaffing, or manual processes overriding system or human errors. Financial leakage can fall through the cracks by rushing through tasks or never getting to them. Imagine having 30% more time every day to finish your specific tasks.
  • Insufficient Data – Actionable data allows you to make informed decisions to best serve your health system. According to Global Healthcare Exchange, 66% of healthcare leaders say they lack Real-time reporting. Financial Leakage can creep in where decisions need to be changed after orders are made or the wrong product is chosen. Insufficient Realtime Data can all cause communication to fail between Contracts, Purchasing, AP, and Supply Chain allowing Financial Leakage to drop through the cracks.
  • Expired and Returned Items – Expired items are often caused by insufficient data. Global Healthcare Exchange estimates 7-10% of products expire on shelves. Based on previous monthly or quarterly data you can order less of certain products, so products are not just thrown away. From our own SpendMend experience we find most health systems have dysfunctional return models and processes allowing for a major recovery area. Healthcare Distribution Management Association estimates that 3-4% of products are returned. Return modules are often not accurate and suppliers may or may not make you aware of return credits.
  • Costs – Financial Leakage caused by cost inefficiencies can cost hundreds of thousands of dollars every year. One small area where money is rapidly spent is shipping. An overnight shipped product can easily cost over $100. Another area that can be easily overlooked falls on the supplier. You may be getting charged the wrong tier for items you purchase often.

All these areas are where Financial Leakage can sneak in unseen, but with a strong united effort reaching for full Spend Visibility you can gain better control over your process

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