One of a hospital system’s greatest challenges is how to optimize its workforce. Labor often represents a hospital’s largest expense, so developing a workforce management strategy is crucial to a healthcare facility’s continued success.
In HealthTrust: Solving Workforce Management Challenges, HealthTrust Workforce Solutions VP of Advisory Services Rich Lopez and HealthTrust Purchasing Group Senior VP of Strategic Accounts David Osborn offer their expertise on creating comprehensive strategies for managing labor.
Below is an excerpt from the article, which first appeared in HFM's September 2018 issue.
What drivers are pushing organizations to optimize their workforce?
Although healthcare organizations have always strived to deliver the highest quality care, there is mounting pressure to maintain top performance amid flattening revenue and rising costs. Payments are shrinking or remaining unchanged while the costs of new technology, supplies, pharmaceuticals, and other items are all on the rise. At the same time, organizations must comply with ever-changing state and federal regulations, and these efforts have their own price tags. Taken together, these drivers are creating a perfect storm in which organizations are being pressured from a cost perspective with no relief in sight on the revenue side.
One area that is ripe for improvement is workforce management. Labor is the largest expense for hospitals and health systems, accounting for between 40 percent and 55 percent of an organization’s total operating costs. Compare this to supply chain, which is about 10 percent to 18 percent of operating expenditures, and one can quickly see the impact that optimizing the workforce could have.
To read the article in its entirety, click here.