In healthcare, procurement goes beyond just ordering supplies; it’s about ensuring that critical materials are available at the right time to provide quality patient care.
For Accounts Payable (AP) managers, balancing vendor management, regulatory compliance, and high volumes of invoices can be overwhelming.
Purchase-to-Pay (P2P) automation offers a solution that simplifies these processes, helping you focus on what matters most—your patients.
In this article, we’ll explore how automating procurement workflows can significantly improve efficiency, compliance, and supplier relationships in healthcare.
The Challenges of Healthcare Procurement
Healthcare procurement is complex.
As an AP manager, you’re likely handling everything from medical supplies to facility maintenance services, and you might be managing multiple locations with unique needs.
Manual, paper-based processes can easily create bottlenecks, driving up costs and increasing the risk of human error.
Not to mention, the healthcare industry is heavily reliant on a wide range of suppliers, making vendor management even more challenging.
Keeping track of who gets paid, when, and how much becomes a daunting task when you’re processing thousands of invoices each year.
Without automation, these challenges can lead to delays, unapproved purchases, and strained vendor relationships.
Key Issues Include:
- Manual processing of purchase orders and invoices
- Difficulty tracking spending across multiple facilities
- Maintaining compliance with strict healthcare regulations
- Managing hundreds or thousands of vendor relationships manually
The result?
Inefficient workflows, higher costs, and greater room for errors.
How Purchase-to-Pay Automation Solves Procurement Challenges
P2P automation simplifies—and digitalizes—the entire procurement process, from requisition to payment.
By automating key tasks such as purchase order generation, invoice processing, and payment approvals, healthcare organizations can reduce manual work, minimize errors, and ensure faster, more accurate payments.
Seamless integration with ERP systems means that data flows smoothly between procurement and financial systems, freeing your team from the time-consuming task of manual data entry.
Some of the core features of payment automation include:
- Automated Invoice Matching: Automatically matches invoices with purchase orders and goods receipts, ensuring that discrepancies are caught early and that you only pay for what you receive.
- Vendor Management: Centralizes all vendor data, making it easier to communicate with suppliers, track performance, and ensure timely payments.
- Payment Processing: Automates the approval process and minimizes the use of paper checks, speeding up payments and reducing manual intervention.
- Reporting and Analytics: Offers real-time insights into spending patterns, helping you make data-driven decisions that improve procurement efficiency.
By addressing these key challenges, P2P automation enables healthcare providers to focus more on strategic initiatives that improve patient care.
3 Key Benefits of P2P Automation in Healthcare
1. Streamlined Procurement of Medical Supplies
Ensuring the availability of critical supplies like PPE, medical devices, and pharmaceuticals is essential for patient outcomes.
By automating procurement workflows, healthcare providers can drastically reduce the likelihood of stockouts or over-ordering. Automated systems trigger orders based on preset inventory levels, eliminating the need for manual checks and minimizing delays.
Instead of spending time managing inventory levels manually, your team can now focus on more valuable tasks, such as improving patient care protocols or working with clinicians to optimize the supply chain.
For organizations handling tens of thousands of invoices annually, this shift can significantly reduce administrative burdens while improving procurement accuracy.
For example, a typical full-time AP employee can process around 10,800 invoices annually in a partly automated setup. With full automation, that number jumps to 23,300 invoices per year.
Read more: The difference between Purchase-to-Pay and Source-to-Pay
2. Enhanced Compliance with Regulatory Standards
Healthcare is one of the most regulated industries, and procurement is no exception.
Manual processes increase the risk of compliance breaches, which can result in legal issues, financial penalties, and reputational damage.
P2P automation helps healthcare providers maintain strict compliance with procurement regulations, such as HIPAA, by ensuring that every transaction is recorded and auditable.
Automation simplifies compliance by:
- Automating three-way matching for purchase orders, invoices, and receipts.
- Tracking vendor certifications to ensure compliance with industry standards.
- Providing audit trails for all transactions, ensuring that your organization can quickly respond to audits or inquiries.
This systematic approach to procurement compliance helps mitigate risk while reducing the administrative burden on your AP team.
3. Better Vendor Management
Managing multiple vendors manually can lead to payment delays, disputes, and ultimately, strained relationships.
With P2P automation, you can streamline vendor onboarding, ensure compliance with supplier standards, and improve communication through automated workflows.
The system also tracks vendor performance in real time, allowing you to identify any issues quickly and make informed decisions to optimize your supplier relationships.
Automated payment processing ensures that vendors are paid on time, reducing friction and helping to strengthen these critical partnerships.
With better tools for managing vendor contracts and tracking performance, healthcare organizations can enjoy a more efficient, cost-effective procurement process.
How P2P Automation Addresses Specific Healthcare Pain Points
Eliminating Manual Processes
Manual workflows are prone to human error, and in healthcare, procurement inefficiencies can result in delayed payments, mismanaged supplies, and higher costs.
P2P automation digitizes the entire process, from purchase requisitions to payment approvals. This not only reduces human error but also accelerates the entire process, allowing your team to focus on strategic tasks rather than routine paperwork.
Automation also minimizes the invoice error rate, cutting it from an average of 2% in manual systems to as low as 0.8%.
Visibility Across Multiple Locations
Healthcare organizations often operate in multiple locations, making it difficult to maintain control over procurement activities at every facility.
P2P automation provides full visibility across the organization, enabling you to track spending in real time. With this level of transparency, you can standardize procurement policies, reduce over-ordering, and ensure that every location has the supplies it needs without creating waste.
Three-Way PO Matching for Greater Accuracy
Accuracy is crucial in healthcare procurement, where mismatches in orders, deliveries, and invoices can disrupt operations.
P2P automation supports three-way matching, automatically comparing purchase orders, goods receipts, and invoices to ensure that only correct, approved payments are made. This automation reduces the time spent on manual checks and minimizes financial leakage.
Why P2P Automation is Essential for Healthcare Procurement Now
In healthcare, the pressure to cut costs and improve efficiency is higher than ever.
Manual procurement processes are slow, error-prone, and costly.
By implementing P2P automation, healthcare providers can streamline workflows, reduce errors, and gain full control over procurement processes.
Key advantages of automation include:
- Cost Savings: Automation reduces administrative costs by eliminating manual work and minimizing errors.
- Better Vendor Relationships: Automated payment processing ensures that vendors are paid on time, helping you maintain strong, reliable relationships with your suppliers.
- Scalability: As your organization grows, P2P automation scales with you, allowing you to handle increased invoice volumes and vendor relationships with ease.
Smiles First: A Case Study in Healthcare Procurement Automation
Smiles First, a healthcare organization, was overwhelmed by the volume of supplier invoices they had to process manually each month.
Their AP team spent a considerable amount of time entering invoice data into NetSuite and uploading it to Sharepoint.
After implementing Rillion’s automated AP solution, they were able to streamline their invoice capture and approval processes, gaining full visibility into monthly expenses and reducing manual errors.
The automation has saved Smiles First significant time by allowing them to process invoices faster and more accurately, with real-time dashboards showing where invoices are in the approval process.
This transformation demonstrates the tangible benefits that healthcare providers can achieve by adopting P2P automation to handle high volumes of invoices and multiple vendor relationships.
I like that with Rillion, I can quickly see a pie chart of the expenses. Each month, it gives me a clear snapshot at a glance, which is really helpful. Every day when I’m entering or posting invoices, I take a look at it to see exactly where we stand.
- Nikki Milian – Accounting Manager, Smiles First
Read the story
Conclusion
P2P automation transforms how your healthcare organization manages procurement, creating a more efficient, transparent, and cost-effective system.
By automating these critical processes, you’ll have more time to focus on what really matters—delivering high-quality patient care.
Now is the time to leave behind outdated, manual procurement processes and embrace a solution that offers efficiency, compliance, and significant cost savings.
Take the first step toward more efficient procurement by exploring P2P automation today. Not only will you save time and money, but you’ll also set your healthcare organization up for long-term success.
Automate Your P2P Healthcare Processes with Rillion
Rillion is an accounts payable (AP) automation platform and we help mid-market businesses improve invoice management, automate approval workflows, and optimize payment processes.
Contact us to learn more about the Rillion platform and how it can benefit your organization. One of our experts will guide you through Rillion Prime and discuss solutions tailored to your needs.
