Making Billing Easier for Care Home Managers: Episode #2

Managing a care home is a heavy, demanding, and stressful challenge. Just one aspect is the level of bed occupancy in the care home. This can feel like the least helpful way to assist residents. Yet bed occupancy is what pays the bills to provide the care.

To add to the burden, billing can be complicated even in small care homes. Some residents only want to pay part of their care costs. The council may be paying a portion too. Sometimes, there can even be three people paying for a single resident.

28% of care home invoices are manually adjusted

A 2024 survey asked care home managers how many invoices require alterations or corrections after being issued on average. The answer? 28%!

That’s an unnecessary amount of extra administration work for care home management. It should only be a rare occasion that invoices are fixed by hand.?

Why is this figure so high?

The reasons for sluggish billing

It’s complicated! The core reason is simple: resident billing is complicated!? A single resident may have multiple people paying for that person’s care.

Admission and discharge. Billing becomes more complex when running on a pro-rata basis from various dates.

Council policies. Different councils have different policies, so the system needs to be flexible enough to allow for a range of billing cycles.

Inadequate billing systems. Sometimes, a care home management system that isn’t a finance system will ‘add on’ an invoicing module. But it isn’t a finance system, so it can struggle.

Disconnected systems. It is expected that a care home manager focuses on care, not billing. So, if the care home manager is using one system and the finance system is another, it can become a problem to align them.

The solution: one single cloud system

Fix all the loose ends and over-complication by using one system. A single finance system, accessible on the cloud, that covers admissions, discharges, bed occupancy and finance.

This allows the care home manager and the accounting team to work seamlessly together.

Plus, if a single cloud finance system is used, this can be done without the need for expensive integrations.

What should be covered in a single cloud system?

Several aspects should be covered:

·?????? Finance system. First and foremost, is the billing system a finance system or is it a care management system with invoicing tacked on? Billing is not simple, and using anything other than a proven finance system is risky.

·?????? Complicated billing. Does the system handle complicated billing situations?? Resident billing is not straightforward. Make sure that the system can demonstrate tracking multiple funding sources for each resident, block billing, and other scenarios that arise.

·?????? Bad debt. Does the system include automated collections to chase unpaid invoices?

·?????? Occupancy tracking. Does the system make it easy for the care home manager to track occupancy including block bookings?

·?????? Document management. Does the system store additional documentation to log resident and transaction records?

·?????? Compliance. Is it a finance system with an audit trail built-in and enterprise-grade security from a highly reputable and known software vendor?

·?????? Data security. Is the software vendor trustworthy and with whom you can have a direct relationship?

·?????? Income management. Does the system include Accounts Receivables reporting i.e. ‘as of’ A/R reporting, ageing of debt, breakdown and consolidation to an individual resident, individual debtor, and individual council level?

·?????? Approvals. Does the system allow approvals to be included, so staff can make decisions whilst also tracking every step of the process for auditing?

·?????? Integrations. Does the system offer ‘open API’ capabilities to allow easy integration with your other systems?

·?????? Consolidation. Does the system easily let you consolidate different care homes and legal entities within the same single data source?

·?????? A single system with different roles. Is the same single system used by both your finance team and your care home managers? This provides the foundation for finance and care home managers working together. If the finance team has their finance system and care home managers have a separate system, it can be really hard for the people to work together because they are looking at different systems.

The nice-to-haves of a single cloud finance system

A solid cloud finance system with care home billing capabilities should offer extra capabilities to make life easier for finance managing a care home.?

·?????? Advanced reporting. As a finance system, you should be able to go beyond basic reports with financial analysis by a resident, care home, entity, service or funding source. It makes life easier for finance teams.

·?????? Simpler financial consolidation. Running the finance side of multiple care homes is much less hassle if they are all in the same single data source.

·?????? Profitability. Care home managers are rightly focused on the care of residents. It is the billing that pays for that care. A single cloud finance system for the finance teams and care home managers puts everyone on the same page.

·?????? Contract bed management. Closely tied to managing profitability, contract bed management and contract values impacting invoicing can be an important factor. A cloud finance system enables this.

·?????? Planning and Budgeting. Including billing in the finance system enables much-improved planning and budgeting.?

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Where to start

If you are currently running a separate care home billing and finance system and it isn’t working well, think about the options we’ve explained. You may have these questions: should the finance system as a whole be replaced first? Or should the care home billing be replaced first?

Our answer would be to start with the biggest challenge. If the challenge is care home billing, then start with the care home billing and solve that. Knowing that the rest of the finance system can follow.

If neither the finance system nor the care home billing is working well, then do the finance system replacement first. Care home billing is covered so you kill two birds with one stone.

Conclusion

Care home billing is complex. It is a great example of where a modern cloud finance system can make life easier for both operational managers and finance. This is achieved by using a single data source that covers both billing and finance in the same system.