Bad Debt Vendor Management
Bad Debt Vendor Management
Case Study
Bad Debt Vendor Management
Case Study Bad Debt Vendor Managment
Services:
Vendor Transition Management, Process Improvement, Business Transformation, Data Integrity Assurance, Contract Formulization, Regulatory Compliance, Strategic Planning
Challenge:
Providence faced a significant challenge during its merger with St. Joseph Health, necessitating a departure from 23 different bad debt vendors. The organization needed to transition to a streamlined system by implementing a single primary bad debt vendor and a single secondary bad debt vendor. Complicating matters, some vendors held accounts with over a decade of past due balances, and certain vendors lacked formal contracts. The transition required meticulous management to clean up outstanding accounts and ensure the integrity of the data provided to the new vendors.
Solution:
To address the challenge, a comprehensive solution was devised. The organization initiated a systematic process to categorize accounts, deciding to send some to charity, write off others, and establish specific rules for accounts designated for the new primary and secondary vendors. Contracts were formalized with vendors lacking prior agreements. Importantly, data integrity was prioritized to guarantee the accuracy of information transferred to the new vendors. The solution involved creating a robust framework for managing diverse accounts while adhering to regulatory and contractual obligations.
Results:
The implemented solution yielded substantial positive results for Providence St. Joseph Health. The estimated revenue uplift amounted to $7.8 million for the primary vendor and $5.3 million for the secondary vendor. Additionally, cost reductions were realized, with savings of $2.2 million for the primary vendor and $735,000 for the secondary vendor. This outcome reflected the effectiveness of the project in optimizing revenue streams, minimizing costs, and establishing a more streamlined and efficient bad debt management system for the merged entity.