The average healthcare system is no stranger to financial pressures. Even back in 2017, Deloitte estimated that over 50% of hospitals would hit negative margins by 2025 due to payer mix changes, regulatory frictions, and rising labor costs (which are primarily fueled by hyper-competitive fields like physicians, nurse practitioners, and physician assistants. Now, with COVID-19, an accelerated regulatory atmosphere, a shift in practice habits (e.g., the rise of virtual visits), and shaky supply chains, the pressure to build resilient healthcare revenue streams has never been higher.
Forty-seven percent of healthcare CFOs admit that financial viability is their biggest concern in 2020. The rising costs of PPE combined with canceled elective procedures and COVID-19 hospitalizations have put immediate financial pressure on hospitals, and the changes in patient visitation, technology, and labor acquisition put a question mark on future financial strategies.
Perhaps the most succinct summation of today's financial frictions in healthcare comes from a CFO of a large integrated health system in their conversation with Deloitte:
"The biggest unknown—and I shared this concern with my peers—what will be the new normal?"
What does the future hold? How can you create a robust financial plan in the midst of uncertainty? What tools can you use to contain costs and preserve revenue streams?
As it currently stands, hospitals are losing $50.7 billion per month, and which is expected to continue for at least 12 months. When we break down the contributing factors that result in losses, we see more of a convergence of past and current frictions than a single underlying cause.
Of course, this merely scratches the surface. The semi-intangible costs of employee happiness, healthcare views in America, payer mix shifts, and regulatory pressures are also draining, so that's far from an exhaustive list. Thankfully, mitigating some of these costs and breeding a healthcare resiliency culture starts by tackling more controllable healthcare components — like your provider workforce.
Workforce optimization — or the process of reviewing budgets, production, and staffing in each department — can help healthcare systems maximize labor efficiencies while reducing cumbersome labor costs that can quickly impact the bottom line. On the surface, workforce optimization can help you quickly supplement staff, eliminate pesky cost centers, and redefine labor boundaries. But, behind the curtain, workforce optimization is an incredibly powerful resiliency tool.
Workforce Optimization can reduce labor costs without impacting the quality of care, provide visibility into your cost architecture, and reduce burnout for both physicians and CFOs. In a period where elective surgeries are piling up due to backlogs, labor costs are spiraling as physicians and nurses deal with new COVID-19 challenges and safety guidelines, and management is carefully navigating the tumultuous waters of cost control, workforce management can help you rally the troops effectively and safely across your healthcare system.
VISTA Select — a full-service Managed Service Provider (MSP) solution powered by a world-class Vendor Management System (VMS) — helps healthcare systems breed end-to-end workforce management solutions. The VISTA Select MSP features rich analytics, robust reporting, and an unparalleled partnership network to help you uncover labor revenue leakage and create a sustainable workforce.
When we look at the significant problems plaguing the modern healthcare industry — from the shift to telehealth to physician shortages and regulatory pressures — labor is the lever that unlocks tangible resiliency in modern healthcare systems. With VISTA, you can quickly monitor and control your workforce, across departments, while quickly flexing recruitment and reassignment strategies. Our preferred partner network can help you instantly find in-demand nurse practitioners, CRNAs, PAs, and physicians, while our industry-leading workforce management tool can help you discover precisely when and where you need their talent most.
By partnering with the country's leading recruiters and talent networks, we will help you find valuable healthcare talent without forcing you to pay additional hidden costs beyond the physician’s actual price. We offer a single point of contact, and a robust system for full-service managed staffing support. Our SaaS model VMS delivery keeps costs low, and legacy servers and integration woes at a minimum.
The truth is: healthcare costs are rising. The first step towards better informing your fiscal decisions and creating a strategic financial plan is solving your labor and workforce issues. VISTA can help.
Between payer mix changes, regulatory pressures, and rising labor costs, healthcare is already vulnerable. COVID-19 has accelerated those vulnerabilities. Are you struggling to find profitability between COVID-19 and traditional healthcare systems? VISTA can help you optimize your workforce to reduce those financial pressures. Contact us to learn more.