Managing paper. It’s something all healthcare businesses do, and often, we don’t give a second thought as to how much it costs per year to manage paper. Fortune 1000 companies spend billions annually. The cost you spend per employee on paper management could pay for that person’s healthcare benefits for a year. It is a staggering amount. Some studies have estimated that companies spend 31 times the cost of purchasing the paper on managing the paper. Just think of it—printing, copying , storing, mailing or sending, disposing, and recycling—it’s an endless nightmare.
When contemplating a paperless document management system, it’s easy to just look at the system cost alone. You’ll have a different outlook if you also factor in your costs associated with managing data in a paper format.
Even in our digital and technological age, much of corporate America still relies on paper—but there is a big cost, and a large part of that cost is the time and money spent on locating misplaced paper documents. This is a particularly troubling pain point for most companies, but in particular for healthcare organizations due to the extensive regulatory paperwork and frequent audit preparations.
How frequently do companies lose their documents? How prevalent is misplacing or misfiling information, and what is your financial outlay because of these mistakes?
Surprisingly, one out of 20 (or 5 percent) of an organization’s files are misplaced or lost on any given day. Over time, this amounts to 20 percent of a company’s information being misfiled, and about half (10-12%) are not found on the first attempt. Some are lost forever. A big part (about 50 percent) of a healthcare professional’s day is spent searching for information, but 95 minutes of each week is spent looking for misplaced files in the office, whether that be in the physical files or on the computer. In fact, companies spend six times more in labor searching for a lost file than the labor it took to file the paper initially. And if you have to recreate the document, it costs more than 10 times the original filing cost. This inefficiency adds up to a big cost over time for your company: $14,000 in productivity per employee per year is spent on inability to find data needed to perform their jobs. For a large enterprise with 1,000 employees, millions are wasted on searching for and recreating documents.
Implementing paper-reduction measures could save your company more money than you might imagine, whether you go fully paperless or incrementally reduce paper over time. Citigroup is one example: the corporation reduced paper costs by 25 percent simply but implementing paperless investment statements; this amounted to millions of dollars in savings.
In a single year, the typical office worker goes through over 10,000 sheets of paper! The actual cost of the paper—about $80---only represents about 10 percent of the lifecycle cost of the paper as we mention above. Copying accounts for about one-third of the lifecycle cost, with distribution costing a whopping 56 percent.
Storage of documents is another high cost when you factor in the cost of filing cabinet systems and the cost per square foot you are spending on the office space to house all this paper. Offices that have not embarked on the paperless transformation still have 50–70 percent of their total office space dedicated to paper storage.
Amazingly, nearly half of those files are old information that doesn’t have value and isn’t accessed or it’s duplicate information taking up valuable space. Healthcare companies are particularly skittish about removing any paper in case it is needed for legal issues, compliance issues or audits.
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