The remittance that does not add up
A payment lands from the county council. It covers eleven residents, four weeks, and comes with a remittance advice that is a PDF of lines with reference numbers you did not issue. It is short by an amount that does not match any one resident. Next week another authority pays for two residents placed from out of area, a month in arrears, at last year's rate.
Your administrator spends a day with the remittance, the invoices and a spreadsheet of who is funded by whom, working out what was paid for what. Some of the difference is a resident's assessed contribution that the council expects you to collect. Some is a part week after an admission. Some nobody can explain, and it goes on a list to query.
Why fee income is so hard to reconcile
Care home funding is layered. A single resident can have a local authority contribution, their own assessed contribution, a third-party top-up and, in a nursing bed, funded nursing care paid at a separate rate. Each part can change on a different date. Each payer pays on its own cycle.
Authorities also differ in how they work. Some pay gross and ask you to collect the resident's contribution, some pay net. Some pay four-weekly in arrears on their own schedules, some pay against your invoice. Their references rarely match yours.
Most accounts packages, whether Xero, Sage or QuickBooks, will reconcile a payment against an invoice. They cannot tell you that a payment is short because the council applied a rate increase from a different date than you did. That knowledge is in your administrator's head.
What the mismatch costs
| Issue | Consequence |
|---|---|
| Unexplained short payments | Money written off or left unchased |
| Rate changes applied late | Months of underpayment found at year end |
| Contributions not collected | Resident balances build up quietly |
| Admin time | Days each month on remittances and queries |
| One person understands it | Finance knowledge walks out if they leave |
Small differences on each remittance add up over a year, and the ones found late are the hardest to recover because the authority has closed that period.
How we match payments to residents
- A funding record for each resident: who pays what, at which rate, from which date, including resident contributions, top-ups and nursing funding. This is the piece most homes are missing.
- Expected income worked out from that record for each period, so there is something to match against before the payment arrives.
- Remittance reading: remittances from each authority, whether CSV, spreadsheet or PDF, are parsed into lines. Where a PDF has no structure we use extraction with a check step, not blind trust.
- Matching of each line to a resident and period, using the authority's reference, the resident's details and the dates, with your own mapping for each authority kept in the system.
- An exceptions list showing only the differences, with the likely reason: rate mismatch, part period, contribution not paid, not recognised.
- Matched payments posted to Xero, Sage or QuickBooks through their APIs, so your accounts reflect the reconciliation rather than a lump sum.
The rules on who pays what come from your contracts and your adviser. We record them and apply them consistently; we do not interpret funding law.
A remittance that takes minutes
When a payment comes in, the remittance is read and matched. The administrator sees a short list of lines that did not match and why. Rate changes show up on the first payment after they should apply, not at year end. Queries to the authority are specific, with dates and amounts.
The funding record also answers the questions your manager is often asked: how many residents does each authority fund, what is each resident paying, what is outstanding. And if your administrator is off, someone else can follow the process.
Does your finance look like this?
- Remittances are matched by hand against a spreadsheet
- Short payments go on a list and are rarely chased
- Rate changes are discovered months later
- Resident contributions and top-ups are tracked separately
- Only one person understands how the fees work