Growing healthcare organisations strive to cost-effectively scale their business – Turning to the cloud for financial management

Growth of healthcare organisations—from either consolidation or increased output and revenues—continues to trend upward in the industry, thanks to drivers such as federal mandates, market competition, tighter margins and the increasing need to do more with less.

Regardless of whether healthcare organisations expand as a result of consolidation or organic growth, the one challenge they all face is trying to gain visibility and transparency of information across the organisation in order to better manage costs and link cost to outcomes and industry performance—without negatively impacting revenue and growth. One of the ways healthcare organisations can avoid over-investing in human and IT resources is to cost-effectively scale their IT systems, including their financial management systems.

As growing healthcare organisations strive to cost-effectively scale their business, cloud computing is being recognized as a viable solution. The top three reasons for adopting cloud services are lower maintenance costs, speed of deployment and lack of internal IT resources. Regulatory pressures are also driving healthcare organisations to leverage more agile, cost-effective technologies.

Within financial management, multiple systems housing disparate data, spreadsheet-based financial consolidation processes, long and cumbersome monthly closes, and lack of visibility into financial and operational performance are common pain points for growing healthcare organisations, according to Sharon Carnicelli, product marketing manager for Sage Intacct. Sage Intacct works with many healthcare organisations in need of managing their financials as they expand. Many were expending manual effort and too much time trying to gather data spread across several different locations and put them into spreadsheets, which led to lack of timely visibility into their performance, Carnicelli pointed out in a June 2014 webinar, How Growing Healthcare Organizations Leverage Cloud Financials, presented by Healthcare Finance News.

Solutions that automate key financial processes are helping finance departments in healthcare organisations become more efficient with the monthly close, the procure-to-pay process and management reporting. Automation also helps capture and centralise financial data so that they can gain insight into what’s happening at each location as well as the overall organisation. In addition, automation within a cloud-based solution helps healthcare organisations keep IT staff from expanding, even as the organisation continues to grow. “They want to be a healthcare company and not an IT company,” Carnicelli pointed out. “So they want to minimise reliance on IT, so they can keep doing what they do best.”

Renal Ventures: streamlining financial processes, improving business reporting

Renal Ventures Management, provider of dialysis services across 30 clinics in 6 states, doubled its size in the last 3 years. Its growth, however, was compromised by numerous challenges. Renal Ventures was forced to rely on a time-intensive, error-prone manual process of data manipulation using spreadsheets to consolidate financial information from 20 different clinic-specific QuickBooks databases. Excel-produced reports and manual reporting, respectively, excluded the accounting department and decision-makers in other departments from gaining visibility into information such as sales and profit and loss statements (P&L), which were not being reported in QuickBooks.

Instead of adding staff to manage the increasing data, which was becoming unsustainable with QuickBooks, Renal Ventures deployed Intacct’s cloud-based solution. Through a standardised set of accounts, all of Renal Ventures Management’s entities, for example, can share a vendor and gain visibility into various business information such as the organisation’s total spend with that particular vendor.

The move from QuickBooks to Sage Intacct resulted in an ROI of 154%, with an average annual benefit of more than $163,000.

“We now have a single chart of accounts and consolidated financials, which has allowed us to virtually eliminate manual processing of financial data outside the application.”

Dan Orlinski, Senior Finance Director at Renal Ventures Management

Financial viability

Healthcare organisations are looking to keep growing and thriving in this era of healthcare transformation. Indeed, in  the 25th Annual HIMSS Leadership Survey, which highlighted what’s on the minds of senior IT executives, 25% of respondents said that financial viability is the key business objective their organisation is trying to achieve in the next 12 months. Those organisations that successfully meet their business objectives will continue to grow and be cost efficient as a result of leveraging robust, enabling, cloud-based technology.

“These business objectives will continue to rise in importance as accountable care organisations and other value-based reimbursement models are formed and become operational, as M&A drives consolidation in the marketplace and competition in healthcare markets increases.”  

Patty Enrado, special projects editor for HIMSS Media and webinar speaker.

Contact us at Akuna Solutions and explore with a Sage Intacct implementation specialist how to leverage the most modern technology available today to support your organisation’s mission. 

Photo by National Cancer Institute on Unsplash