Posts from February, 2012

Last month at the IFO’s HPAS conference I had the pleasure of co-presenting a session with Jennifer Barnett, former AP Manager of Summa Health and current AP Manager for Walmart Foundation.  The session, entitled Moving Beyond Manual Processes to Improve AP Efficiencies, focused on how while at Summa Health, Jennifer had worked to move away from manual recovery and vendor master file cleansing processes to Lavante’s automated solution.

We began the discussion with a review of the challenge health care providers face in keeping the vendor master files up-to-date. Not only are suppliers constantly changing, but as with any company, there is a constant shifting of individual contacts at each supplier.  Jennifer noted that at Summa Health System the vendor master file was split between AP and Supply Chain. When the decision was made to merge all files together, they looked at how to best perform this function and update records at the same time.

As Jennifer recalled: “We met Lavante at IFO’s Fusion conference, and while we weren’t looking for a recovery provider at the time, when I saw that the recovery process included vendor data file cleansing, I knew we needed to learn more.  After returning from Fusion, we worked with Lavante to do a cost comparison between using the Lavante Recovery solution and using contractors to manually go through our master vendor records, and there was just no real comparison.”

As Jennifer and her team had just concluded a 3-month recovery audit with a traditional recovery service, spending three months on-site combing through hundreds of boxes of historic invoices, physically touching 95% of all payables, she didn’t expect Lavante to find any credits. “I was astonished at the immediate credits that Lavante was able to uncover. They found credits that the other service never found, in spite of the fact that they had physically gone through all of our payable records for the previous 7 years. Lavante found sizable recovery dollars from as far back as five years ago.”

Lavante works with many health care providers and finds that not only can we find credit dollars that traditional firms will miss, but we can easily identify root causes for these credits. Because Lavante Recovery assigns a “type” to each credit identified by the supplier, our clients can quickly identify problem areas.

Jennifer brought up several examples of how Lavante was able to identify process improvement areas. The first related to rebates. Lavante was able to find rebates that they simply never knew were out there. Once identified, Jennifer’s team was able to work with the supplier to recover dollars due them from years back. Another example focused on identifying that many invoices were paid without the proper discounts being applied. “These both represented what would have been missed money that our organization would never have recovered without Lavante’s automated recovery audit solution,” Jennifer noted.

Returning to Jennifer’s original issue – vendor master file cleansing – Jennifer recalled that Summa took a phased approach to deploying Lavante, bringing in separate hospitals one at a time. After the first year, over 80% of its vendors had been updated, a rate that continued to improve.  And, because this update process is ongoing, they don’t need to do an end-of-the-year vendor master file update process. It’s always ready.

I thoroughly enjoyed working with Jennifer at the conference! It was good to hear more about how Lavante has made a  difference at Summa Health Systems.

The session will be repeated as a live webinar later next month, so stay tuned for that announcement.