Pharmacies Need a Robust Reconciliation Process to Streamline Patient and Payor Payment Processing

Pharmacies are actively pursuing revenue diversification by increasingly delivering clinical services alongside traditional prescription fulfillment. This broadening of pharmacy care means that patient payments may be due at the time of service and after claim submission and payor processing, which adds complexity to financial management processes.

Supporting revenue diversification in your pharmacy takes effort, expertise, and technological support. Adding more people to the process or more work for your existing team members is costly and impractical, but implementing a robust, automated bank reconciliation tool ensures accurate financial management and compliance.

Five Benefits of Automating Bank Reconciliation

Revenue cycle management (RCM) solutions that are interoperable and designed to integrate or interface with upstream and downstream applications make bank reconciliation easier by:

1. Reducing Manual Processes and Errors: Manual reconciliation is time-consuming and prone to errors. Automating the process eliminates the tedious task of cross-referencing bank transactions with deposit batches in the RCM system. Automation ensures accuracy and frees up valuable staff time for more critical tasks.
2. Detecting Unrecorded Payments: Payments sometimes appear in your RCM system but not in the bank. These unreconciled items could be due to timing issues, such as delays in electronic fund transfers (EFTs). Automated reconciliation helps highlight such cases for resolution.
3. Identifying Missing Payor Remittances: Automated reconciliation can also quickly identify any instances where payor remittances appear in your bank account but not in your RCM system. This visibility allows your team to investigate and resolve discrepancies promptly.
4. Facilitating Daily Bank Fund Confirmation: Automating daily reconciliation allows pharmacies to confirm bank funds promptly, expediting payment posting and enhancing cash flow management. This real-time insight ensures timely identification and resolution of any variances or discrepancies.
5. Creating an Auditable End-of-Month Record: Automated systems maintain a complete and accurate record of reconciled and unreconciled transactions, ensuring compliance and simplifying audits. This traceability is crucial for month-end reporting and financial transparency.

Example: How Automated Bank Reconciliation Works with XiFin RPM

XiFin RPM’s bank reconciliation automation exemplifies how technology can simplify this essential financial process. Here is an overview of how it works:

1. Bank Data Integration: XiFin RPM requests BAI2 data files from the pharmacy’s bank. These files detail all transactions in the pharmacy’s bank account(s) reflecting EFT, ACH, and other debits and credits. A lockbox is configured to receive a direct file from the pharmacy’s bank
2. Deposit Creation: EFTs, ACHs, and other deposit types are recorded in the RCM system, either manually or automatically.
3. Automated Matching: XiFin RPM reconciles bank transactions with deposits recorded in the system and matches deposit transactions in the BAI2 file to the XiFin deposit batches. The system compares the electronic file transfer (EFT) identification (ID) and dollar amount to ensure correct reconciliation.
4. Payment Posting: The payment processing team can quickly identify reconciled deposits in XiFin RPM to facilitate timely posting.

5. Reporting: The automated reconciliation results are published in two XiFin business intelligence (BI) reports. Employees can use these reports to research unreconciled items and determine the next steps

   • Unreconciled Deposits: Highlighting discrepancies for resolution.
   • Reconciled Deposits: Confirming matched transactions for audit purposes.

The Role of Automated Bank Reconciliation in Pharmacy Success

Automated bank reconciliation is more than a technical upgrade—it is necessary in today’s pharmacy operations.

By aligning financial records with real-time banking data, pharmacies can avoid costly errors, improve cash flow, and support compliance. Whether dealing with complex payor arrangements or managing patient payments for clinical services, automation provides the tools to keep your financial operations running smoothly.

Implementing a robust automated bank reconciliation solution saves time and gives pharmacy teams actionable insights that helps them make better-informed decisions.

Our eBook, Auditing the Complexities of Medical Billing for Clinical Services and Specialty Pharmacy, gives you more insight into the importance of automating bank reconciliation, and it reveals key areas for improvement in your revenue strategy.