SpendRule Launches AI for Healthcare Contract Intelligence
SpendRule has launched an AI-powered contract intelligence platform designed to help health systems stop overpayments. The system validates service invoices against contracts before payment is issued. The technology targets the $323 billion purchased services market, one of the largest and least-managed spending categories in healthcare.
- Purchased services account for nearly 36% of the average hospital's operating expenses, representing one of the most significant areas for potential cost savings. - Industry estimates suggest that more than $32 billion in preventable overpayments occur annually within the purchased services sector due to the complexity and lack of oversight of contracts. - SpendRule's co-founder and CTO, Joseph Akintolayo, explains that the platform works by turning static contract agreements into code, which allows for an automated four-way match between the purchase order, receipt, invoice, and the contract terms. - The company launched with several health systems already using the platform, including OSF HealthCare, Kettering Health, MemorialCare, and MUSC Health. - The need for such cost-control tools is intensified by the financial strain on health systems, with average hospital operating margins falling below 3% amidst rising labor and supply chain costs. - A core problem the technology addresses is that most service contracts are stored in digital or physical files, disconnected from the accounts payable workflows that are supposed to be governed by them. - SpendRule recently emerged from a stealth development period with $2 million in seed funding to expand its platform. - Common causes for overpayments that AI can help detect include duplicate billing, incorrect coding, miscommunication between providers and payers, and coordination of benefits errors.
