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Pain in the @$$ (Support Services) – Part One

healthcare servicesWith all the uncertainly around the survival of ACA, how that will affect who has coverage, cases continuing to migrate to the outpatient arena, and the sickest of patients accessing care in the acute care setting, many through the costliest of the ER, who has time to address how all these high pressing issues trickle down in to your support service departments? These departments play a significant role in the overall hospital experience, your HCAHPS scores and in turn have a direct impact on your profitability.

With over 500 clients across the country, we hear similar challenges that impact the ability to drive true sustainable change in these departments. Consistent challenges heard include:

  1. Limited and/or no access to benchmarks of like size facilities in similar geographic regions to know how they compare.
  2. They don’t know exactly what they are paying for all in. And more importantly what they should be paying for these services.
  3. They simply do not have resources to manage cost reduction or operational effectives initiatives in these departments.
  4. The resources they do have do not have enough expertise in these niche areas to understand the nuances of service that impacts each department both from a financial and operational perspective.
  5. Low HCAHAPS scores are impacting reimbursement.
  6. For those facilities using a management company, there is a lack of transparency of financials.
  7. There isn’t a standard of care using best practices driving a unified system solution.
  8. Employee turnover is high, constantly needing HR resources to onboard and integrate into their culture of care.
  9. Patient satisfaction is suffering.
  10. Employee engagement is low- directly impacting your patient satisfaction.

HCAHPS and net profit marginTwo areas that can steer your direction is looking at the correlation of HCAHPS scores and your net profit margin. Hospitals with excellent patient satisfaction scores had on average a 4.2% net operating income margin compared to hospitals with low patient satisfaction scores only having a net operating income margin of 2.4%. As you can see, having a focus on financial, operational and quality metrics aligns objectives across the department and across your facility.

Self-op or in-house departments and outsourced programs also have a different/unique view into where the opportunity is derived from.

For those programs that are outsourced some key questions to ask yourself:

  • Are you in a long-term management contract (4-5+ years) AND Do you understand how much income your vendor is making from management fees and administrative fees?
  • Does the vendor’s invoice provide sufficient level of transparency? Is every line item on the invoice supported with proper detail and is it contractually agreed upon?
  • Has there been a significant capital investment by your supplier?

For in-house/self-operated programs:

  • Do you have the right level of technical, financial, and management team to invest in and implement innovation in your departments?
  • Does your management team have access to national brands and resources to drive innovation to your facility?
  • Are you considering outsourcing the day-to-day management and operations to a management company?

In this short 7-minute webinar, I review the challenges our clients are talking about and begin to identify areas of opportunity you can look for within your organization.

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