What is Cost Cycle Management?

SpendMend has recently noticed Health Systems applying this same approach towards Cost Cycle as well. Cost Cycle Management gives visibility to the costs associated with conducting business and securing the necessary products and services to support the Health System on a day-to-day basis.

An important facet associated with Cost Cycle Management is containment of Financial Leakage.

The Reality is financial Leakage occurs in every organization. Even though organizations invest considerably into preventative controls (to prevent financial leakage), it still exists. Due to the unique challenges within the Healthcare Industry, Financial Leakage is more prevalent than in any other industry:

Change – one of the most consistent attributes in today’s Healthcare Industry is “Change”. Merging with other Health Systems, upgrading or even changing ERP systems, restructuring department and changing GPO providers are just a few examples. Many of these changes are also happening with a demanding vendor base as well.

Complexity – Departments tend to function independently with different systems and procedures that are not easily transparent, and many times structured to support the clinical needs. (i.e. Surgery, Supply, Pharmacy, etc.)

Compliance – while investment in processes/procedures is sound, a Health System still relies on individuals to comply with those processes. Lack of compliance will have a negative impact on the data used to contain Financial Leakage.

Read More…

Watch The Experts Talk About Cost Cycle Mangement