Healthcare purchased services have come a long way in the three years since we founded Valify. In that time, purchased services has transformed from a misunderstood budget area to a top financial savings opportunity and priority for healthcare organizations nationwide.
As hospital executives focus on surviving major industry changes such as new payment models and shrinking reimbursements, the cost reduction spotlight seems to be focused more on M&A activity and labor reductions rather than purchased services. This is despite the potential to achieve significant savings without disrupting patient care.
In the healthcare world, group purchasing organizations (GPOs) have established their place for streamlining vendor selection and cost savings on products. However, these organizations do have their limits and can’t be relied on for every single aspect of your hospital’s spend management and cost control.
Most of the topics I have written about on this blog have been about how to save hospitals money, but in reality, the real goal is to increase their overall performance. So instead of listing out another purchased services area to help save your bottom line, today we will discuss an interesting way to increase top line revenue within your hospital by showing you the marketing value of the crowds of people walking through your organization every day.
While patient health is of primary concern, hospital management can't overlook the essential business side of running a hospital, which needs every incoming dollar to survive. In 2012 alone, U.S. hospitals provided $45.9 billion in uncompensated care, only 25 percent of which resulted from uninsured patients. Whats more, the average collections recovery rate for hospitals in 2013 was a mere 15.3 percent, according to ACA International.
Investment in capital equipment is a decision that shouldnt be made lightly, particularly for health care organizations. There are many factors to consider when selecting equipment that best suits your needs, with the bottom line being the consideration of total lifetime costs associated with its use. Other factors may include:
Some businesses—think Wal-Mart or Amazon in the retail world—buy a lot of stuff. Their high-volume buying enables them to extract better deals from their vendors, the kind of deals that smaller businesses simply don’t have the clout to command.
Hospital waste management is a system more complex than it first seems, involving a complicated group of disposal methods that can increase the burden of healthcare logistics on any organization. When it comes to different types of waste, healthcare facilities must use a strict set of guidelines to dictate the appropriate way to dispose of waste safely and effectively.
If you don’t know where you are, you’ll have a hard time getting where you need to be. For getting from one physical location to another, smart phones and GPS have largely made this problem a thing of the past, but it’s just as true for non-geographical things, such as financial goals. Hospitals are being asked to find opportunities to cut spending—but if you don’t know the current state of your spending, how will you know where you should start cutting costs?
Accounts receivable is an area not often considered when purchased services is brought up. This is likely due to the fact that the potential savings hospitals could realize from outsourcing this service is not well understood.