Hospital administrators are under great pressure to find ways to cut costs as the number of sick patients continually increase atop a worldwide pandemic. As the main priority of hospitals is patient care, many are feeling the need to reevaluate their budget and spending costs to allocate more to patients.
In the long run, hospitals that can make smart investments now and know where to cut costs without compromising their values will have a greater advantage than those who choose not to take these necessary steps. Below are eight cost cutting options your hospital can act on now.
1. Record Overhead Costs Accurately and Consistently
As with any business, a hospital’s overhead expenses must be factored in correctly for an accurate picture of their overall operation costs.
These overhead costs can potentially account for a significant portion of the overall budget. When hospital’s overhead costs aren’t in sync with the budget, it can result in increased health care costs at the patient’s expense.
It’s important to know the difference in cost between non-clinical versus clinical care. Accurate and consistent filing and recording of these costs ensures each sector of overhead has their fair share of the budget. When these costs aren’t separated correctly, certain cost cutting programs, such as intervention methods and investments, can be easily overlooked or rendered obsolete.
2. Invest in Your Employees’ Health
As the backbone of each hospital’s operations, the wellbeing of hospital employees is vital. Investing in employee health is a surefire way to assist in reducing hospital costs over time. As employees age and the job becomes more stressful with increased patient counts, the health of these employees can make or break a hospital’s budget.
Investing in employee health now can be as simple as creating educational tools for wellness management. These tools can include classes and programs that define body composition, the risks of high blood pressure, normal ranges of fasting glucose levels, and healthy cholesterol levels.
Additionally, free lab draws and biometric screenings can incentivize employees to prioritize their own check-ups. Hospitals can also hire wellness coaches to offer personalized training to bolster employee health.
Although many of these programs require an initial investment, healthy employees and worthwhile benefits can help with employee retention and reduce the number of sick days or time off that unhealthy employees might need to take in the future.
3. Decrease Costs That Don’t Contribute to Better Patient Care
While it may be easy to blame all overhead costs on increasingly high budgets, it’s important to differentiate tasks that contribute to high quality patient care and certain administrative tasks that can be delegated or reduced. Ways to limit these costs include the following:
- Centralize and consolidate management roles to create cohesiveness and efficiency within the hospital without differing degrees of management. If multiple employees are filling the same role, there will be varying results, which in turn increases costs and overall confusion.
- Make smart investments in the hospital’s facilities, such as installing solar panels in sunny areas and investing in energy-efficient lighting fixtures.
- Identify hidden costs that can be remedied throughout the facility. This keeps unnecessary costs out of overhead expenses, and these changes can be as simple as setting the hot water to run only on business hours for the coffee pot in the breakrooms.
If you’re not entirely sure on where you can look to decrease costs, talk to your staff and give them ways to provide suggestions and feedback.
4. Consider Linen and Scrub Automation Options
Rather than outsourcing for the distribution of clean scrubs and linens, hospitals can save money by utilizing an automated linen and scrub cleaning option directly in their facility.
These automated options give scrub access to authorized personnel exactly when needed, taking away any unauthorized access and the replacement or laundering of scrubs.
Clean and on-demand scrubs will additionally assist with reducing onsite infections as scrub automation systems are in compliance with AORN Guidelines for Perioperative Practice.
5. Partner With Outpatient Facilities
Outsourcing patients and services to offsite facilities can relieve hospital costs immensely. Referring patients to other facilities for lab work, physical therapy, rehabilitation, and so on, can help reduce unnecessary overnight stays at the hospital and use of particular staff.
Utilizing these outpatient services assists both the patient and the hospital in cutting costs by saving hospital beds and specialized staffing expenses.
6. Improve and Streamline Bureaucratic Operations
The number of steps that go into filling a simple prescription or lab order are often a massive burden on clinicians. Many of these steps involve multiple technical channels and bureaucratic tasks to send orders through.
This heavy administrative work can be improved by optimizing the filing and billing process of provided services.
If electronic transactions of these processes are prioritized and created over manual transactions, there is a high potential of not only hospital savings, but also making it one less task clinicians need to worry about.
Additionally, educating patients on their billing services and how much they can expect to owe from the services will assist in issues that arise when collecting potential debts.
7. Carefully Evaluate Shipping and Logistics Strategies
It’s common for hospitals to receive specialized equipment, medications, and life-saving specimens daily.
What may not be common knowledge is hospitals adding up how much they end up spending on shipping costs. When inbound and outbound deliveries aren’t standing out in hospital ledgers, it’s easy to dismiss them, because they aren’t separately coded.
You can create savings by taking note of these deliveries and then working with vendors and switching to carriers that don’t run up costs.
For example, hospitals can save thousands of dollars by reducing overnight shipping for operating room supplies or by leveraging vendors who have difficulty closing sales.
8. Replace Faulty Restroom Facilities
While restrooms may not be the first place to look when cutting costs, the amount of resources hospitals spend on repairs, water bills, and additions to restrooms add up.
Replacing sinks, toilets, and urinals with low water flow models can assist in reducing the overall cost of water needed in restrooms and, depending on the models chosen, can reduce the number of repairs or future replacements.
9. Hire Per-Diem Nurses
Unexpected vacancies or vacations, understaffing, and hiring freezes create unforeseen costs for hospitals and challenges for everyone in general. Not only that, but understaffing can burn out current staff and additionally increases the risk of unsafe patient care practices or mistakes.
Consider having a staffing agency on the books in case of empty shifts. A good staffing agency can help find you qualified personnel on short notice.
Clipboard Health makes finding the right CNA, LVN/LPN, or RN to fill shifts easy and affordable, cutting out recruitment costs and reducing stress on staff. Contact us today to sign up and start filling your vacant shifts.