“There are a lot of ways to save money in a hurry, but the idea here is to avoid the next step which is usually layoffs of good people doing a good job.”
We see it all the time, hospitals are being sold/merged to other health systems, closed, or services are being paired back dramatically all in the name of reducing/eliminating costs. Hospital margins are paper thin at best for many organizations and that is nothing to wave your hat at; the struggle is real. There are systematic ways to keep costs in check but sometimes organizations just need some quick fixes to solve short term cash flow issues. This article is about giving you a few of those quick fixes that cost little or no money to do but may be worth their weight in gold.
4 Quick Ways for Your Healthcare Organization to Save Money
1. Pause Your New Product Request (NPR) Submissions with Exceptions – Let’s face it, NPRs are going to add new costs to your organization one way or another, so it makes sense in cost savings times to put a pause on new product requests. There should be some exceptions to the rule though, especially those that will add quality reimbursement in the form of your surgeons performing a new service. What you want to avoid is adding a $425 instrument to a case that the reimbursement is flat on, or worse, already close to being a loss. Remember, you need to be getting not only the cost of the new implant/instruments to perform the new service for new reimbursement, but you must also include the Surgical Suite, CSR, etc., overhead in the mix as well.
2. Quickly Poll Your Employees for Areas of Waste – You are going to get some left-field reports of waste and inefficient use, but you are also going to get a few gems of information. Do the polling, sort through the recommendations, and pull out the gems of big savings opportunities. I recall walking through a cafeteria with the end results of one of these polls posted on a billboard. This 220-bed hospital saved over $800K from their employees’ recommendations. What I saw was savings opportunities that our firm usually finds with clinical supply utilization and value analysis teams. The clinicians know! This does work and can be done rather quickly.
3. Ask Your Department Heads and Managers (Different than Polling) – Often times, department heads and managers know where they can obtain savings in their own departments but perhaps have just gotten caught up in running their departments and have not gotten around to working on the savings opportunities. Like a Lab Manager who knew they had issues with their Reference Lab and needed to do a thorough review of what was being sent out versus what was done in-house. Many times, this review can save tens or even hundreds of thousands of dollars. Your department heads and managers also meet with sales reps who often have lower cost alternatives available but perhaps the timing is wrong for the implementation. Perhaps then you can bring those offers to the top of your list of savings possibilities.
4. Validate Past Savings – Everyone keeps a savings report for supply chain and value analysis teams. Those reports are only projections, and let’s face it, nobody ever follows up to see if they actually received all the savings they were supposed to. Go back to this year’s report, as well as last year’s, to make sure you did receive the savings. First, you will find areas that you not only saved what you projected but that you saved more and perhaps can add it to your list of what your boss is looking for in added savings. Second, you will find savings that just did not materialize or that departments went back to their old ways. The good news is that you would have had documentation via supply chain or VA, and you could quickly go back and reimplement and book the opportunity again.
Save Money with Clinical Supply Utilization Management
There are a lot more ways to reduce costs in a hurry, but the idea here is to avoid the next step which is usually layoffs of good people doing a good job. We can make a difference, but we must think outside the box to make savings happen. Lastly, there is the area that is often left untouched and that is clinical supply utilization that can tell you where all of your savings opportunities are in as little as 30-45 days. We can be a quick fix in the short term but also a long-term savings tracker for you.
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