The Cost of the Healthcare Workforce
Natonya Acosta
MHA/543
07/20/2020
University of Phoenix
Three Key Drivers of Labor Costs
Three key drivers of healthcare costs are Physicians, expensive technologies and procedure, high administrative expenses. In a hospital some of the key labor drivers are new positions needed to fill positions for new technologies. For example, when electronic health records were added, also IT initiatives, and cross provider care are just a few examples of areas that needed new positions and staff. Higher wage demands also drive up labor costs, aging patients with acute care, the larger population, more physicians, surgical centers and urgent care (hfma.org, n.d.).
Reducing Labor Costs
Nurses make up about half of a hospitals clinical staff, so having a better retention rate will help keep costs down. High turnover rates increase labor costs (hfma.org, n.d.). Allowing career advancements, can help reduce turnover. Automating some process can help reduce labor costs, there are automated check ins, there are automated systems available that can confirm claims are adjudicated properly so staff does not have to (hfma.org, n.d.). Some other ways to cut labor cost are work from home positions administrative positions and leveraging global talent (hfma.org, n.d.). Hospitals can increase the use of analytics to change revenue workflows (hfma.org, n.d.). Stealth cost is another way to assist with turnover which costs labor costs, career and leadership development training can help fill positions without having to hire new employees. You can then train other employees for the openings that others were trained for, if there was a need to hire new employees it would be for lower paying easier positions.
Future Changes
The main factors of increasing hospital costs are labor, costs for goods and services, changes in the number of services provided. Costs will continue to rise due to the increasing aging population who need more procedures and acute care. Currently the Affordable Care Act is in place, it is difficult to say what changes may be implemented if there is a new plan. Medicare and Medicaid pay the lowest percentage of claims which keeps the costs higher.
Natonya Acosta
MHA/543
07/20/2020
University of Phoenix
Three Key Drivers of Labor Costs
Three key drivers of healthcare costs are Physicians, expensive technologies and procedure, high administrative expenses. In a hospital some of the key labor drivers are new positions needed to fill positions for new technologies. For example, when electronic health records were added, also IT initiatives, and cross provider care are just a few examples of areas that needed new positions and staff. Higher wage demands also drive up labor costs, aging patients with acute care, the larger population, more physicians, surgical centers and urgent care (hfma.org, n.d.).
Reducing Labor Costs
Nurses make up about half of a hospitals clinical staff, so having a better retention rate will help keep costs down. High turnover rates increase labor costs (hfma.org, n.d.). Allowing career advancements, can help reduce turnover. Automating some process can help reduce labor costs, there are automated check ins, there are automated systems available that can confirm claims are adjudicated properly so staff does not have to (hfma.org, n.d.). Some other ways to cut labor cost are work from home positions administrative positions and leveraging global talent (hfma.org, n.d.). Hospitals can increase the use of analytics to change revenue workflows (hfma.org, n.d.). Stealth cost is another way to assist with turnover which costs labor costs, career and leadership development training can help fill positions without having to hire new employees. You can then train other employees for the openings that others were trained for, if there was a need to hire new employees it would be for lower paying easier positions.
Future Changes
The main factors of increasing hospital costs are labor, costs for goods and services, changes in the number of services provided. Costs will continue to rise due to the increasing aging population who need more procedures and acute care. Currently the Affordable Care Act is in place, it is difficult to say what changes may be implemented if there is a new plan. Medicare and Medicaid pay the lowest percentage of claims which keeps the costs higher.