How do you run a fiscally fit medical practice? Many physicians agree it takes a considerable amount of hard work and the right financial gear to stay in shape. One tool gaining momentum in the health care field is the use of purchasing cards. Purchasing cards (or P-Cards, as they’re commonly called) help save time and money when making purchases, resulting in extra time for what matters most—patient care.
The P-Card was originally designed for small-dollar purchases, including office supplies, equipment repair, and petty cash. However, the P-Card now offers enhanced authorization and spending controls, reconciliation tools, and reporting tools. Because of the tools that accompany a P-Card program, many medical practices have discovered they use the card beyond small-dollar purchases to include utilities, equipment leases, insurance premiums, and medical supplies.
P-Card Benefits
Using a P-Card can dramatically simplify the entire purchasing process. It also puts the purchasing authority in the hands of authorized staff members, allowing them to acquire medical supplies or goods in a timely manner. Other benefits of the P-Card include:
• Increased spending control. The controls on a P-Card program are designed to ensure the card is being used for its intended purpose. An administrator can control the types of merchant categories where the card is accepted. In addition, a single transaction limit or monthly spending cap can be employed to ensure compliance with internal purchasing procedures.
• Improved efficiency. The P-Card program offers electronic billing and payment options, eliminating unnecessary paperwork and reducing administrative effort.
• Detailed monthly statement reports. The options on a P-Card program allow the administrator to access card transactions daily to analyze purchasing activity more efficiently.
• Eliminates invoice matching. A single monthly statement assigns default codes to transactions as they come in, which eliminates costly reconciliation of supplier invoices.
Because of all the controls and tools, many organizations have extended their P-Card programs to include travel and entertainment and even vehicle expenses. This emerging trend is known as a one card solution. Based on an employee’s need to purchase and/or travel, the authorization and spending controls can be tailored to fit the functional requirements of each employee.
Many banks offer such card programs; the key is in the implementation. Proper implementation of a P-Card program should include all aspects of both the current purchasing process and the desired outcome of a card program. Best practices of successful implementations include buy-in from all levels of staff. In fact, P-Card programs that lack support don’t achieve the maximum efficiencies and, unfortunately, underutilization occurs. In most cases, under-utilization is due to improper use of reconciliation tools or authorization controls that are too restrictive or too lenient. Since every medical practice is different, it’s important to be sure a P-Card is right for yours. TPW