By Andrew Brandenburg, Regional VP of Sales
Healthcare leaders often ask, “When is the right time to run a profit recovery audit?” The most common response is: “We’ll do it later, when things settle down.”
But here’s the truth: That “right” time never comes.
Health systems are in a constant state of flux—new initiatives, operational restructuring, leadership changes, and financial pressures. Ironically, these moments of transition are exactly when you should perform a profit recovery audit. Let’s break down why waiting is a mistake, and when you should act.
After a Major Operational Change
Changes in supply chain workflows, billing procedures, or vendor management often introduce inefficiencies. Even if the goal is to improve financial performance, these transitions open the door to errors—missed credits, duplicate payments, and overcharges.
Best Move: Perform a profit recovery audit immediately after implementing new procurement strategies, AP processes, or supply chain workflows to catch costly oversights early.
Following a Leadership or Staffing Shift
New leadership brings fresh perspectives but also inherits legacy financial blind spots. When key personnel in finance, supply chain, or procurement transition out, valuable institutional knowledge goes with them. Unresolved billing errors, vendor discrepancies, and mismanaged contracts often linger in the background.
Best Move: If there’s a major turnover in finance or supply chain teams, a profit recovery audit can serve as a reset, ensuring no critical dollars slip through the cracks.
During Mergers, Acquisitions, or System Integrations
Mergers and Acquisitions (M&A) bring an overwhelming amount of financial and operational complexity. Integrating different ERP systems, aligning contracts, and consolidating vendors create prime conditions for billing errors and revenue leakage.
Best Move: Conduct a profit recovery audit during or immediately after an M&A process to identify misaligned contracts, duplicate payments, and overlapping vendor agreements before they become bigger financial headaches.
Before and After Implementing New Technology or an ERP System
Financial system migrations and technology implementations often cause disruptions in invoice reconciliation, rebate tracking, and purchase order visibility. Even the most well-planned transition introduces human and system-based errors.
Best Move: Audit financial transactions before and after a system migration to ensure accurate vendor payments, prevent contract discrepancies, and catch lost rebates.
When Supply Chain Disruptions Impact Costs
The past few years have shown how unstable supply chains create pricing discrepancies, contract violations, and vendor billing issues. Health systems are often charged higher prices than negotiated, and rebate opportunities are overlooked.
Best Move: If your organization has experienced major pricing fluctuations, vendor changes, or supply chain issues, now is the time to audit those transactions for hidden overcharges.
When Budget Season Rolls Around
During budgeting cycles, leadership looks for ways to maximize cost savings and revenue recovery. Yet, many health systems wait until after they finalize their budget to think about a profit recovery audit. By then, it’s too late to act on recoverable dollars.
Best Move: Don’t wait until year-end. Conduct an audit before or during budget planning to identify savings opportunities that can be reinvested into patient care and operations.
Before a Compliance or Regulatory Review
Government audits and regulatory inspections can reveal compliance gaps in financial processes. Non-compliance with contract pricing, rebate management, and vendor payment accuracy can lead to significant penalties.
Best Move: A proactive profit recovery audit before an external audit protects your bottom line and prevents costly surprises.
The Bottom Line: Don’t Wait for the “Right” Time—Act When Change Happens
The biggest mistake health systems make is waiting for a “stable” moment to conduct a profit recovery audit. But change is exactly when errors—and opportunities—are most likely to surface.
Instead of waiting for the dust to settle, lean into those transitions and use them as an opportunity to uncover hidden dollars. Because in healthcare, every dollar saved is a dollar that can be reinvested in better patient care, better operations, and a stronger future.