Cost Reduction Strategies In Healthcare

Growing costs in the healthcare sector often force service providers to charge their patients prices that seem unreasonable or unaffordable. While insurance might help patients pay for the services they receive, healthcare facilities can also take a proactive approach that reduces costs, leading to savings they can pass on to patients.

What cost reduction strategies in healthcare should you consider? There are plenty of options, but not all of them will work with your specific facility.

Popular Cost Control Strategies in Healthcare

What are some of the most prevalent cost-reduction strategies in healthcare organizations? They include:

• Standardizing and bundling contracts to secure lower prices from independent providers.
• Improving efficiency so patients receive effective care as quickly as possible.
• Controlling workforce costs by hiring a full staff that helps you avoid overtime pay.
• Giving employees excellent benefits so they continue working at your facility instead of leaving for new opportunities.
• Optimizing schedules so you have the right number of employees on the floor at any given time.
• Focusing on evidence-based interventions that improve patient recovery.

Some of these hospital cost-reduction strategies might sound counterintuitive at first. Wouldn’t giving employees more benefits lead to higher costs? In some respects, it will increase the amount of money you spend. However, it can also help you retain talent and avoid the expense of training new hires. The cost-effectiveness of keeping a reliable employee on the payroll is usually higher than training a new person who might not work as hard.

Finding Cost Control Strategies That Work

The point about employee benefits packages hints at a larger issue: you can’t trust your instincts when choosing cost-reduction strategies for healthcare organizations. Relying on your assumptions will lead you astray far too often.

Instead, you need to take a data-driven approach that shows you how much you can save by adopting certain strategies. That’s where software solutions like Valify come in. Valify’s spend analytics technology gives you immediate insights into your spending. The platform also has tools for:

• Accelerated sourcing
• Sustainable savings
• Diversity

Forget about using guesses to optimize your budget. Digital solutions collect and analyze accurate data to give you an overhead view of your hospital’s costs and how you could lower those costs.

Leadership Strategies for Healthcare Cost Reduction

Leadership always plays a prominent role in an organization’s success. After all, they’re the people making difficult decisions and pushing for meaningful change.

What leadership strategies for healthcare cost reduction should your group adopt? Let’s start by exploring some recent trends that have helped other healthcare groups succeed.

Value-Based Healthcare

Value-based healthcare puts the patient at the center of every decision. The goal is to choose effective interventions so patients recover quickly. That way, the hospital can serve a larger community of patients.

Value-based healthcare also needs to practice medical interventions that contribute to long-term health. Getting someone well enough for them to leave a hospital bed might offer an immediate benefit, but that person might return soon with the same health condition. Instead, try taking a holistic approach that anticipates future needs. If you can treat and prevent a condition, your healthcare system will have a better chance to thrive.

Continuous Improvement Management

Some leadership strategies in healthcare should concentrate on improving the skills of people already working in the healthcare facility. Continuous improvement provides useful feedback that helps leaders identify their strengths and weaknesses.

Ideally, the hospital offers training opportunities that promote positive change management strategies in healthcare.

How does this help lower costs? Over time, you should find that you can promote more people from within, which helps lower your onboarding costs.

You can also apply continuous improvement to your processes. Perhaps you need more effective communication strategies in healthcare. Continuous improvement recognizes existing flaws in the current plan so you can build a better system.

You can also apply continuous improvement to:

• Operational strategies in healthcare
• Teamwork strategies in healthcare
• Directional strategies in healthcare

Review these and other processes at least once a year to get an honest assessment. If you find opportunities for improvement, you can boost patient care and treatment efficiency to lower overall costs.

Advantages of Collaboration and Implementation Strategies

Adopting collaboration strategies in healthcare often leads to improved patient outcomes. It’s also one of the most effective cost-reduction strategies in business.

Collaboration Strategies in Healthcare

Collaboration strategies bring together professionals from different departments to provide holistic care. All too often, healthcare organizations have different teams working in silos with the same patient. The teams don’t share much information with each other, so they never coordinate to develop a truly effective treatment plan.

With more collaboration, you could, for example, bring nutrition and cardiovascular experts together to treat someone with heart disease. Since diet influences heart health, it makes sense for these groups to share information and work toward a common goal.

Dissemination Strategies in Healthcare

Patient interventions don’t always take place in a dedicated healthcare facility. You might also need to serve patients in their communities.

That doesn’t necessarily mean having doctors and nurses make house calls. Disseminating information to members of the community can also help. For example, you might team up with your city’s health department to send out weekly newsletters full of health tips.

If you can improve the community’s health, your hospital will spend less money treating chronic illnesses.

Implementation Strategies in Healthcare

How do your teams share information with each other so they can implement holistic interventions and treatments? That’s where implementation comes in.

Adopt implementation strategies in healthcare that encourage seamless communication. For example, you might give each doctor and nurse a mobile tablet they can carry during their rounds. This makes it easy for each person to review the status of every patient they encounter.

Without a seamless information implementation strategy, there’s a big chance essential data will slip through the cracks. That’s bad news for the patient, employees, and the hospital’s budget.

Risks and Challenges in Implementing Cost-Reduction Strategies

Cost-reduction strategies have the potential to redefine your hospital’s effectiveness while cutting costs. They also have the potential to upset the successful strategies you already have in place.

What can you do to address concerns about cost-reduction strategies in facilities management?

Focus on Patient Care

First off, don’t get so focused on reducing costs that you forget about the quality of patient care. In the long run, poor patient care will undermine cost-reduction strategies in facilities management. If anything, you might find yourself investing a little more than usual. This strategy works when you invest in the right tools.

Reduce Errors

Secondly, put processes in place to prevent errors. Few things are more expensive than mistakes. They can force your employees to perform tasks multiple times, which could mean paying overtime. Errors can also put patients at risk. If your staff makes a mistake that hurts someone’s health, or worse, defending yourself in court could cost thousands of dollars. Implement error-reduction strategies in healthcare to promote patient well-being while streamlining tasks.

Manage Risks

Thirdly, adopt risk management strategies in healthcare to protect your patients and organization. Error-reduction strategies play a role in this, but it’s not the end of your work. Managing risk often means:

• Comparing vendors to choose the most reliable, cost-effective option
• Giving employees access to ongoing training that keeps them current with the latest interventions
• Evaluating employee performance so you can identify low-performing team members
• Evaluating employee performance so you can identify and promote your best team members
• Reviewing hospital policies to ensure they align with your goals

ing to consultants about insurance policies that protect and support your organization’s mission

While you can’t completely eliminate risk, you can manage it to protect your healthcare organization from inefficient processes, negligence, and costly contracts.

Future Trends in Healthcare Cost Reduction Strategies

Emerging technologies should influence future trends in healthcare cost reduction strategies. Preparing for potential trends will give you an opportunity to anticipate the tools that work best for you.

Some of the best cost-reduction strategies to expect in the near future include:

More Remote Care Options

More advanced remote care options that let your staff members treat patients outside of the facility. You’ve already seen a significant push toward some types of remote care. The Internet of Things and a growing list of smart devices will make remote care more advanced than ever. Imagine how much money you could save by checking a patient’s vitals without having them come into your office. It would save you time and money while giving you more opportunities to see other patients.

More Detailed Nutrition Information

Healthcare facilities can’t afford to neglect the importance of nutrition. Excellent nutrition could help people avoid chronic illnesses. It could also help your patients recover sooner from in-patient services. If spending a little more on quality meals developed to meet each person’s unique needs moves patients through the system faster, it’s a cost-reduction option you must explore.

Streamlined Management

All cost-reduction strategies in healthcare require oversight. Of course, you don’t want the cost of management to outweigh the amount of money you save. That’s why you need streamlined management tools. Valify’s suite of features gives you greater control over costs without forcing you to spend more time at your computer. Want to learn more about how Valify can work for you? Schedule a demo today!

Want to reduce the cost of purchased services in your health system? If so, contact us today!