Automation equals efficiency: How home care can reduce their accounts payable admin burden

As demand grows for home care packages in Australia, increasing efficiency is a business imperative. The latest Stewart Brown Aged Care Financial Performance Survey Report showed that home care profit margins are down from 5.4% to 2.9% YoY and the administrative costs as a percentage of total revenue are up 2.5%.

One of the challenges for home care providers is dealing with the substantial administrative burden caused by the introduction of the Improved Payment Arrangement (IPA) and the ongoing home care reform journey. 

In 2022, RMIT-Cisco Health Transformation Lab released a report in response to the Royal Commission’s report on Aged Care Quality and Safety that highlighted the critical role technology and digitalisation play in transforming the aged care sector, emphasising the need to automate and streamline non-care duties. One area that can provide rapid ROI and time-saving is accounts payable automation.

Redmap, a specialist in increasing efficiencies in document-driven processes, has partnered with leading technology provider for the aged and disability sectors, AlayaCare, to develop a fully integrated Accounts Payable Automation solution.

This automated solution is specifically designed to support home care providers in automating the reconciliation of vendor invoices to care visits, a task that carries a significant administrative burden as every service event needs to be claimed individually.

Annette Hili, General Manager Australia & New Zealand at AlayaCare, says providing solutions like the Accounts Payable Automation helps free resources so they can be redirected to other essential services. 

“We want to help home care staff spend less time on laborious and repetitive tasks. Reducing the administrative burden around invoicing means funding can be directed to direct service delivery. This not only improves operational efficiency, but ultimately benefits the clients themselves,” Ms Hili said.

What are the challenges posed by invoice burden?

• Insufficient time, as it is extremely rare for home care providers to have a specific resource to approve invoices and add to the client account, so this frequently falls to the care manager
• Home care providers working with a range of vendors often deal with invoice irregularities, which alongside tedious manual data entry, can result in errors being made
• Inefficiencies due to repetitive triple-handling when care staff, managers and the finance department are all involved
• Unsuitable systems and processes can result in variances not being picked up, invoices being missed or lost, or delayed payments and additional incurred costs
• Home care providers can miss out on reimbursement for care services being delivered to customers if there is no process for finalising outstanding invoices and their 70-day claim window expires
• Employee engagement and job satisfaction often decrease when time-consuming and repetitive manual accounts payable processes exist – particularly those unrelated to direct care

With several layers of complexity to overcome, Redmap Accounts Payable Automation offers a seamless solution for home care providers of all sizes. Most providers currently follow six to eight steps when manually processing invoices. 

Redmap’s automated solution reduces the process from invoice receipt to filing down to one. You can easily scan vendor invoices to extract information, even if the invoice is hand-written, and reconcile it to the booking event in the integrated AlayaCare system. 

Ben Woolley, Redmap Chief Executive Officer (CEO), recognised the major challenge that the industry was facing when discussing the reforms with an existing aged care client.

“I was blown away when I heard about the hoops that home care providers were having to jump through to claim back client spending, and I knew that there was a major opportunity to save aged care workers time,” Mr Woolley said.

“A recent survey that we conducted found that 50% of aged care providers have three or more hands managing each single invoice. In an already overstretched workforce, that just isn’t viable.”

Redmap will also check whether each vendor is registered for GST, ensure the invoice isn’t duplicated, and verify the bank details against the system to minimise the risk of fraud. Additionally, there is increased visibility into committed spending against funding claims, which results in better cash flow management in both the short and long term for home care providers. 

On average, Redmap systems have helped aged care providers reduce processing costs by at least 75% while significantly improving accounts payable visibility. This means no more cluttered email trails, piles of physical paperwork or missed deadlines. The flow-on effect of administrative efficiency also results in more time for staff to focus on providing quality care to clients.

When United Worker Union Aged Care Director Carolyn Smith was interviewed about the state of the industry last year, she was clear about the urgent need for change to support aged care workers.

“They are sick of propping up a broken system. They are sick of their hard work not quite making up for the chronic understaffing in the system, so they are physically and emotionally exhausted by never really giving the quality of care that they know the people they are looking after deserve,” Ms Smith said.

For more information regarding Redmap’s Accounts Payable Automation solution for aged care, please visit redmap.com/integrations/alayacare-integration.