According to the Kaufman Hall National Hospital Flash Report in September 2022, U.S. hospitals are still operating “substantially” below pre-pandemic levels—calling the first nine months of 2022 an “extremely challenging year characterized by dramatic fluctuations in margins.” Year-to-date margins using the Kaufman Hall Operating Margin Index were -0.3% through August; this demonstrated “continued losses hospitals have experienced this year.”
Key report takeaways included some positive data, including that volumes were higher in August than in July, which boosted revenue; costs also rose (although not as much as revenue), including supplies and expensive drugs with labor costs remaining “elevated.” More patients seemed to be scheduling elective procedures, but new market entrants were disrupting outpatient volume.
In response to the report, HealthAffairs.org is especially blunt: “Hospitals in the United States,” they write, “are on track for their worst financial year in decades.” This will lead to aggressive measures to cut costs to stabilize finances. Some hospitals will likely close service lines or departments while others may shut down entirely.
Hospital Headwinds
Staffing crises are affecting hospitals significantly with labor costs increasing more than one-third during the pandemic. Then there are the shortages. Nearly one in five healthcare workers quit their jobs in this timespan, according to a special May 2022 report by Kaufman Hall: The Financial Effects of Hospital Workforce Dislocation. Plus, hospitals are increasingly having to compete against non-hospital employers as companies offer them higher wages.
As they note, “As we speak with CEOs around the country, their first word is usually ‘workforce.’” When looking at nurses in particular, this is a culmination of a decades-long problem. Add in the “substantial” percentage of nurses who are approaching retirement age—and an insufficiency of others to replace them—and the pandemic clearly exacerbated an already growing crisis.
Plus:
- Medicare rates are not expected to meet costs. Because Medicare doesn’t retroactively fix rate issues, this under-adjustment impact will continue.
- Smaller hospitals will be especially affected by contract negotiations made by commercial payers, which are not obligated to offset costs.
- Economic uncertainty will likely play a role in lower volumes of patients having elective procedures, especially in an era of high-deductible health plans.
In summary, these are not short-term headwinds. HealthAffairs.org notes, though, that this is also an “opportunity to address industrywide inefficiencies.”
Workforce, Workforce, Workforce
Just like a real estate agent focuses on “location, location, location,” healthcare CEOs are focusing on the workforce in conversations with Kaufman Hall. Although these discussions often focus on medical staff, shortages impacting hospitals go well beyond those professionals.
According to Gartner, Inc., IT talent shortage is becoming more severe with 64 percent of IT executives seeing this as the most significant barrier to the adoption of emerging technologies in 2021; compare this to 4 percent just the year before. This is the main adoption challenge for the majority of IT automation technologies (75 percent) and almost half of the digital workplace tech (41 percent).
This shortage of IT pros means that many of the ways in which hospitals can address inefficiencies—by leveraging modern technologies—can also present problems for the healthcare organizations. As hospital budgets are beginning to crack, what can you do?
Two key strategies include discovering what benefits and workplace policies will attract workers and retain them—and supplementing staff with consultants.
Advantages of Outsourcing Healthcare IT Consultants
By augmenting your healthcare IT department with outsourced EMR consultants, you can fill in knowledge gaps for your projects, arranging for them to collaborate with your organization for a certain time frame. When it elapses, you can end the arrangement without any of the hassles associated with layoffs. Or you could contract with them again for another period of time. As another strategy, you can use contract-to-hire professionals and, if needed, add them to your in-house staff.
Consultants are available with a wide range of specialties. Once you analyze your current team and identify gaps in knowledge and/or bandwidth, we can then strategically fill in those gaps to benefit from their niche expertise without needing to pay benefits or payroll taxes like you would with employees.
By using an experienced healthcare IT company to source your consultants, you can find knowledgeable experts to fulfill your unique needs to achieve your goals in time- and money-saving ways. You can leverage the power of emergent technologies to streamline your processes and procedures efficiently.
Choosing the Right Healthcare IT Company
Make sure that the staffing agency you’re partnering with has the technical expertise that aligns with your healthcare facility’s needs. Many offer broader services without targeted specialties. Here at HealthTECH Resources, we have one single focus—healthcare IT/EMR/EHR expertise—and we have deep industry connections and strong professional networks.
We offer healthcare IT support in phases where it’s needed. For example, you may need an analysis of your current EHR system to see if it needs to be optimized or replaced plus explorations of other EHR applications to see which best dovetails with requirements. We can help with this phase of healthcare IT consulting, including making recommendations based on your specifications and offering project management services.
Perhaps you’re ready for the implementation, integration, data migration, and optimization stages of your EHR software. We provide top experts for systems such as these:
Additional areas of expertise offered include training, process documentation, go-live and post-live support, and more.
When considering a firm for healthcare IT consulting, investigate how well they keep up with technological trends with an impact on healthcare IT, in general, and specifically connected to each of the EHR brands they service.
How rapidly does the staffing firm respond to requests for healthcare IT support? How much experience do they have? What about their list of clients? Will they share testimonials? How much do you feel valued by the company?
We check all those boxes and more! Contact HealthTECH Resources online or call (602) 903-7961!
PRESIDENT/CEO AT HEALTHTECH RESOURCES
Larry has specialized in building strategic healthcare relationships for over 25 years, helping the nation’s top payors and providers solve some of their most pressing business challenges through an intelligent mix of staffing services, training, and consulting.