Business, Finance

Social Care providers waste almost six figures on a broken expense model. Here’s how to fix it. 

7 July 2023  |   8 minutes read

The debate around how to fix Social Care continues to drag on. And, unfortunately, the political dawdling on the issue is unlikely to end soon. Just this year, the UK government announced that funding promised for the care workforce will be halved.

The issue has, effectively, been pushed to the next parliament. And no matter what shape that next parliament takes, the state of public finances means a genuine transformation will most likely elude us yet again.

As the Institute for Government notes, current spending plans beyond 2024/25 “are very tight, with the government pencilling in annual spending increases of approximately 1%”. And those increases will likely go to the NHS, schools and overseas aid. These needs will (most probably) be satisfied before Social Care.

For the moment, the focus must turn to what can be done right now. And Social Care providers should focus heavily on cost efficiencies. Let’s look at one prime example of inefficiency that you could eliminate pretty much overnight.

Check out Soldo’s webinar ‘Moving forward, fast: How care finance teams can use tech to slash admin in Social Care’ (in association with Care Talk). Watch here >

In this blog, we will examine:

How to save money in Social Care

Social Care has always faced a uniquely tricky dilemma when it comes to cost efficiencies. Where finance teams in other industries can perhaps be more creative in cost-saving, Social Care providers can’t cut corners.

Service users are vulnerable, and quality is paramount. On the other hand, leaders are squeezing finance teams to cut costs. In the most recent CFO Signals report from Deloitte, more than half of the surveyed CFOs said CEOs want them to focus foremost on cost reduction.

For Social Care, it’s pressure from two directions. So where to go for savings? You’ve likely heard the phrase ‘you can’t get something for nothing.’. But as the economist Robert Jameson explains, that’s not strictly true (at least in business):

“…most processes — including the production processes used in making nearly every manufactured good we own — involve a considerable amount of waste. If we wasted fewer materials or made more effective use of people’s time, then we’d be producing things more ‘efficiently’ and we could, effectively, get something for nothing.”

Finance teams in care should start here. Where is time (and consequently money) being wasted in Social Care? One area is your expense process.

An example of inefficiency in Social Care

The unique thing about expenses as a driver of inefficiency is that we can quantify it. Soldo recently asked Forrester Consulting to measure the Total Economic Impact of an expense management platform on our current users.

An expense management platform puts expense approval, policy and reconciliation all in one place. Employees use prepaid cards to pay for work expenses – which can be plastic, virtual or temporary – and snap a photo of the receipt.

The employee submits that expense to the platform for approval. Once the finance team approves the expense, it’s seamlessly reconciled in the accounts. Repetition adds up – and by automating expense tasks like reconciliation or allocation of money, the time-saving is huge.

Forrester’s research found that our expense management platform saved time equivalent to nearly £100,000. Flip that figure on its head, and we see that companies are letting that money go to waste by persisting with a broken expenses model.

Expenses in Social Care: the £100,000 question

There are many structural challenges with Social Care. That won’t be news to you. Staff shortages, surging demand and funding shortages. These things need fixing at a national level.

But social care providers aren’t helpless. There are proactive things you can fix right now. Like fixing a broken expenses model that is complex, admin-heavy and costs you almost six figures in lost time.

A good place to start is with an expense management platform. One Soldo user, a finance manager at a social care provider, explained how dramatic the difference was before using an expense management tool and after:

“We can monitor spend a lot easier now. We can run reports, we can see who’s used their cards, how and where they’re being used, whereas we didn’t have any visibility with our previous provider.”

There are easy wins for care providers, too. And while it won’t fix the many structural issues the sector faces, becoming more efficient will give you momentum. This will give benefits right now. And when things finally improve for Social Care – and they will – you’ll be primed to take full advantage.

Expense management for social care

Get a clear view of spending in real-time and control all costs in one platform. From purchasing PPE to paying for staff training and building maintenance, Soldo lets you do it all, effortlessly.

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