Three-way matching for nursing homes, explained
Three-way matching means paying an invoice only when it agrees with two other documents: the purchase order (what you ordered) and the receipt (what arrived). Hospitals have done it for decades. Most nursing homes and assisted living communities still don’t, and they pay for it in invoices that bill for goods that never came.
The three documents
| Document | Answers | Who creates it |
|---|---|---|
| Purchase order | What did we agree to buy, at what price? | The buyer, after approval |
| Receipt | What actually arrived? | Whoever signs for the delivery |
| Invoice | What is the supplier asking us to pay? | The supplier |
When all three agree within a tolerance you set, the invoice is approved. When they don’t, a person looks before anything is paid.
Why it rarely happens in senior care
- Nobody records receiving. Deliveries arrive at many buildings and are signed for by whoever is nearby. The paper packing slip ends up in a drawer, so there’s no receipt to match against.
- Invoices arrive in too many ways. Email, paper, supplier portals. Getting them into one place is a job in itself.
- AP is central, buildings are not. The person approving payment is rarely the person who saw the delivery.
How to start without EDI
You don’t need electronic data interchange with every supplier to match invoices.
- Make receiving a photo. Ask whoever signs for a delivery to photograph the packing slip. Software can read it and match it to the purchase order.
- Take invoices as PDFs and photos. AI can read them well enough to compare against the order, as long as a person checks exceptions.
- Set tolerances. Decide how far price and quantity can differ before a person has to look. Small differences shouldn’t hold up payment.
- Handle short shipments at the door. Mark what didn’t arrive as backordered or closed short, so the invoice can’t bill for it.
What to watch
The point isn’t zero exceptions. It’s that exceptions are seen before payment, not discovered at year-end.
In Vendoro, receiving is a phone photo of the packing slip, invoices come in as PDFs, photos or from the supplier portal, and every invoice is checked against the order’s prices and what was received. See how it works.