Across all types of healthcare organizations, clinician vacancies have both direct and indirect costs. For hospitals and medical practices, physician vacancies can impact a variety of areas, including revenue, patient experience, quality of care and more. In this post, we will explore all the direct and indirect costs of these vacancies in depth.
Direct Costs of Physician Vacancies
Direct costs are expenses that can be attributed specifically to a physician vacancy. Some of the costs facilities and practices incur include:
Loss of physician-generated revenue.
When your facility or practice has physician vacancies, you miss out on billable revenue. Instead, this revenue will go to one of your competitors. According to a recent study, the average physician generates as much as $2.3 million in revenue for his or her employer annually. With this much revenue at stake, it is clear that vacancies can be detrimental to your facility's bottom line.
Cost of filling vacancies.
In addition, the expenses associated with filling a vacancy increase losses even more. As an example, the cost of recruiting a family medicine physician is estimated at $342,000. This encompasses travel costs for interviews, valuable and expensive staff time to find and recruit the physician, and depending on the situation, it may also include costs for credentialing, licensing, privileging, and other related items.
Indirect Costs of Physician Vacancies
Indirect expenses are those costs that cannot be exclusively attributed to physician vacancies but are nonetheless related. The most significant indirect cost of physician vacancies is related to the quality of care patients receive, as well as their experience with the facility.
When a facility's staff is short just one physician, the entire team can suffer as a result. With this physician out of the picture, the clinical team is without its "quarterback," and everyone on the delivery team may feel increased pressure. Patients are on the receiving end of the pressure these providers feel. In addition, the continuity of care suffers immensely, causing a ripple effect that impacts every patient who visits the facility.
If patients feel like they are not receiving enough one-on-one time with physicians and other members of the healthcare team, they are more likely to take their business to a competitor. Regardless of whether patients ultimately leave your facility in favor of a competitor, they are much less likely to refer your services to others if they are not happy with the care they receive. When this becomes a trend, the success and profitability of your business will decrease.
Furthermore, as more and more reimbursement structures shift to care quality and patient satisfaction-based metrics, the issue of diminished patient experience becomes even more important for healthcare facilities to consider.
Physician vacancies impact the average healthcare institution considerably. From direct expenses like the cost of recruitment to the consequences of poor patient experience, healthcare facilities with one or more vacancies are sure to suffer many losses. In light of this evidence, it is clear that physician vacancies should be taken seriously and avoided if possible. The best way to prevent physician vacancies from harming your institution is to develop a solid workforce optimization strategy that addresses this very issue.
VISTA is proud to offer solutions to healthcare facilities and practices looking to maximize their staff population and minimize the costs of physician vacancies. Please contact us today to receive your complimentary Workforce Optimization Review and learn more about our services.