Improving facility efficiencies and flexibility in 2022: 5 considerations

Actively protecting your revenue cycle, managing costs and easing the strain on your facility's financial health are essential measures for success this year and beyond.

As COVID-19 continues spreading, engaging and retaining clinical professionals will remain a challenge for hospitals and healthcare systems. The healthcare community was already stretched thin before the pandemic created never-before-seen challenges for these professionals, who have long asked for better working conditions.

Much of the nursing workforce has been trending toward retirement for quite some time. From 2000 to 2018, the average age of employed registered nurses increased from 42 to 47 years old. Labor shortages impact facility costs, stretching budgets even further and straining profitability. In 2020, some hospitals saw operating cash flow margins fall to a median 7 percent.

So, what does this all mean for your facility’s budget in 2022? The strain on financial health is likely to continue through the year, but there is opportunity to protect your organization’s revenue cycle and help manage costs by taking the following steps: examining past costs, recognizing present needs, finding innovation opportunities, diversifying your staffing strategy, and finally, tying it all together.

Your facility’s leadership and revenue cycle management teams have likely reviewed past costs in their 2022 budget planning. It’s essential that your department understands what goes into that process so you can successfully move forward into the new year.

For organizations ranging from hospitals, to outpatient centers, to skilled nursing facilities, here are five components of a thorough healthcare cost analysis:

1. Identify your goals: Here, revenue leaders focus on what they want to accomplish with the analysis. They also identify stakeholders and consider which metrics should be used to accurately measure past financial performance.
2. Identify associated costs: Associated costs can include direct costs such as labor and inventory costs; indirect costs such as fixed expenses related to operations; tangible costs such as payroll; intangible costs such as reduced patient satisfaction after a change in administrative process; and opportunity costs, or lost opportunities related to pursuing one strategy over another.
3. Identify benefits: Benefits can be classified as direct, indirect or competitive. An example of a direct benefit is increased revenue generated from telehealth appointments; an indirect benefit could be improvement in your facility’s reputation among patients; and competitive benefits include your facility being known among healthcare professionals for offering flexible scheduling.
4. Assign values: By assigning a monetary value to each of the costs as well as to each of the benefits, your facility leaders can compare them accurately.
5. Compare costs and benefits: Finally, budget decision-makers have the data to determine next steps. They likely revisit the goals established in step 1, then research what cost reductions would be most effective if the costs outweigh the benefits.

Understanding how much your department and your facility spent last year and comparing it to benefits gained and benefits available in the new year will be vital to establishing and managing your 2022 budget.

In today’s ever-evolving healthcare climate, strategic investments in staffing and technology are necessities. This is especially true in the face of the nursing shortage across the country.

There’s no question as to the importance of technology in healthcare. How are your patients and your teams impacted by your facility’s current innovations — or lack thereof?

For instance, do your current technology investments include resources to meet interoperability goals, new avenues for improving staffing efficiency and telehealth platforms?

How is your patient population affected due to current staffing challenges? For instance, nurses spend the most of their time with patients. They also influence cost across your facility. Their feedback from the frontline, diligence in documentation and patient advocacy are crucial to maintaining cost efficiency. As a result, your investment in engaging and retaining nursing staff and in their success is an investment in value-based care.

With CareRev's staffing solution, facilities offer healthcare workers the flexibility to manage their own schedules; no more paper request forms, time clocks or endless phone calls to fill shifts. CareRev supports organizations with fully-vetted, per-diem professionals who can fill shifts with increasing patient demand. This is an excellent strategy for tackling any nursing shortage with no commitment to more full-time employees or expensive traveler contracts.

Coupling your organization’s cost analysis from the previous year with a hard look at your present needs can help you make effective predictions. This ensures your organization’s ability to modify and reshape across the board. Adaptability is a strength — one that can help secure the financial health of your facility.

Diversify your staffing strategy.

Visit www.carerev.com or email [email protected].