Hello Durable Medical Equipment Industry.
Are you advancing your automation agenda for working capital optimization?
Healthcare Reform has put a strain on budgets and ushered in new complexities when it comes to collections and overall receivables management. One of the key issues is the lack of capability through investment in technology and automation. As budgets continue to be compressed this critical area of advancing automation to ease manual processes and increase cycle time to cash is problematic. But this doesn’t mean the problem can’t be solved with strong partnerships.
We’re here to tell you that it doesn’t have to be as difficult as it sounds. Leveraging collaboration through domain specific partnerships helps. Credit to Cash providers in an outsourced partnership can take some of the complications out of the matter by understanding the new world and customer complexity to solve the impact and the fine details toward improve working capital.
In anticipation of the many changes occurring over the past years, most companies within Durable Medical Equipment industry are working to update their finance and accounting systems and taking into consideration changes that may impact the timely collection of invoices. Financial systems need to be enabled to deliver and support flexibility to reduce impact on business operations. Question is, do you find the capital to fund these initiatives or partner with a provider who brings technology with services?
You can start with analysis to understand how this change can affect the customer relationship. I believe the approach of a specialist by customer and transaction type can support mitigating disputes and reducing complexity to the AR cycle. This can easily be achieved with the right platform and in an outsourced model but maybe problematic, due to expenses, in a captive or shared services infrastructure.
Additionally, the comparable analysis of your product portfolio, revenues and customers will help to better understand the current and new customers, who are the end users, intended use of the product is. Only then can accurately estimate and therefore determine what the true potential for optimized DSO should be.
We believe that determining how customers transact invoice payment comes from a number of factors. Deep business analytics and accurately targeting can change the slow paying behaviors. New advances in analytics and payment modeling have made the DME collection process more effective than ever but an investment or a change to an industry leading domain specific BPO partner is required.
Beyond analysis and system updates, comes the complexity of recording and reporting to ensure you’re in compliance with tax regulations. This requires more oversight and controls from a compliance perspective but also requires more diligence in operations – from taking the order to accruing revenue.
The issue may not be the only provision to slice into profits, but the need for additional resources across F&A becomes another issue burdening business with more expenses. With the availability of technology, just like any particular process, the need for manual intervention will be removed. Additionally, analytics and automation, to drive risk mitigation, support a clear view of what can be expected in the long term. By coupling these strategies you effectively minimize the manual and labor intensive processes, see a reduction of credit risk and sustain the most valuable production actions being delivered.
This may take time for some but others utilizing an outsource strategy today, the expertise and enablement is already leveraged. Business process outsourcing and technology solutions, which come with such engagements, make the entire process seamless and can help ensure you are being diligent in optimizing your working capital. At the same time, controls will ensure the customer experience is being considered to avoid losing what are ultimately good customers who need creative solutions.