The tipping point for hospitals – now is the time to cut costs and here’s how
It’s no mystery that a trip the hospital in the U.S. could cost you a small fortune. In fact, we are a country that is notorious for our expensive health care system. The Journal of American Medical Association published a study that showed the U.S. spent $9,403 per capita annually on health care in data studied from 2013 to 2016, which is nearly double what 11 comparable first-world countries spent. Hospitals are notoriously expensive to operate – but where else can patients turn when their health is severely compromised? Stories are posted daily about hospital bills that are in the tens to hundreds of thousands of dollars – costly burdens for the hospital, the insurer and the patient. Hospitals are under constant pressure to reduce costs – now more than ever.
The U.S. population is living longer with more serious health conditions. In fact, 80 percent of older adults have at least one chronic disease, and the number of seniors with four or more chronic diseases is expected to double by 2035. This burgeoning chronically ill population only serve to increase the costs of care across our already burdened hospital system.
Hospital costs are comprised of personnel, medical supplies/equipment, and general facility overhead which could be substantially reduced with improved operational efficiencies. For example, administrative and staffing expenses make up the lion’s share of hospital operating expenditures. Administrative costs alone comprise eight percent of costs in the U.S. as compared to one to three percent for other countries in the JAMA study. However, it’s not as easy as cutting salaries or staff numbers when the patient admission volumes are stable or growing. Highly trained nurse and physician personnel are critically necessary while expensive. Layoffs or reduction in hours to cut costs can result in a decrease in the quality of care patients receive, as well as create added strain and stress for remaining workers. More, rather than fewer, caregivers are needed with increasing patient volumes. Additionally, strain from overworked caregivers will likely be further challenged with increasing national nurse shortages.
Optimization of care must occur to reduce costs and maintain quality care.
Here are three approaches hospitals should consider.
Reduce burnout and expensive turnover by selective technology adoption
The cycle is predictable: patient burden increases, caregivers get burned out, caregivers leave seeking more desirable working conditions. It's expensive to train new staff due to turnover and it will be increasingly hard to find replacement caregivers with the growing nursing shortage. The shortage of registered nurses is projected to continue until 2030 and likely beyond. A significant number of nurses are nearing retirement age and enrollments in nursing programs, though up 3.6 percent, will not keep up with demand. It is important for hospitals to maintain, grow and optimize caregiver personnel to keep up with patient care. Hospitals will be competing for personnel resources from a shrinking pool of qualified caregivers. How will they recruit and maintain needed staff numbers in an increasingly competitive market?
Hospitals can help nurses work smarter, not harder - impacting their jobs in ways beyond salary and benefits packages. Technologies, such as staff scheduling software, predictive analytics tools and wearable biosensors that automatically monitor vital signs, can power nurse efficiency without sacrificing quality patient care. Staff scheduling software can help to monitor and prevent overtime work, which will decrease payroll costs and keep nurses from being chronically overworked. This software gives staff the ability to review upcoming schedules and make adjustments to satisfy needs while managing hours effectively. Additionally, predictive analytics paired with new wearable patient biosensors offer critical insights into patient health while minimizing alarm fatigue. Nurses can use the information from these technologies to prioritize patients in real-time allowing them to focus on those patients who truly need immediate attention.
Focus on quality patient care by automating repetitive administrative tasks
Spending up to 57 percent of their time on administrative work, nurses and caregivers need more time to care for their patients. The admin burden can lead to patients not receiving the best quality of care simply due to time and capacity of the caregivers. When every hour spent in a hospital bed adds incremental cost, easy-to-implement technologies that do not add to the administrative burden are crucial in elevating patient care in order to reduce hospital length of stay.
Manual processes that can be streamlined by using new technologies present the greatest opportunities for improved care and efficiency. These include automated vital signs monitoring and documentation, fall prevention and detection and systems for administering proper medication. Automated systems that accurately measure and record vital signs in the electronic health record and detect if patients are stable or declining, are an example of innovation that frees up staff for more personalized patient care. Patients like that they are being closely watched over by their caregivers, but also need their rest to recover. Bar-code medication administration (BCMA) is widely used across hospitals to prevent medication errors by ensuring the correct dose and medication is administered to each patient. To be effective, however, caregivers must scan patient and medication bar codes in at least 95% of bedside administrations, which often doesn’t happen according to Leapfrog Group’s Hospital Survey. Implementing new technology properly and incorporating new workflows into procedures that improve patient care and reduce admin burden benefit both patient and caregiver.
Support in-home care with new remote monitoring technology
Gone are the days that patients want to stay in the hospital for extended recovery and care. Hospitals around the country are piloting new programs and technologies to monitor patient populations that are not critically acute, and where home care would be more beneficial than a hospital stay. By using new technologies to provide quality care outside of a hospital, patients can safely be cared for in the comfort of their homes surrounded by their loved ones.
New admit-to-home programs allow emergency room patients to be sent home as opposed to being admitted to a hospital. Brigham and Women’s Hospital, for example, has rolled out one such pilot under the guidance of Dr. David Levine. The care team is continuously monitoring patients’ vital signs, sleep and movement once they are admitted to home. Their “Feeling Right at Home” pilot study saw a reduction in hospital readmissions for patients cared for in their homes as opposed to those in hospital (11% vs. 36%). Additionally, the study found patients were more active and got more sleep, averaging an additional hour of sleep per night, while recovering at home. With the introduction of continuous, wireless monitoring, doctors were able to provide the same level of care to patients at home as in the hospital without the high cost and with more comfortable recovery conditions. In the same study, Dr. Levine found a 52% reduction in cost of care in adults cared for at home rather than in a hospital. This is a way of redefining which conditions warrant a hospital stay and which can be treated in the home. Implementing out-of-hospital care can help reduce costs while also minimizing overcrowding and associated staff fatigue.
By adopting new approaches that keep some patients out of the hospital, improve efficiencies in workflow to reduce burnout and utilize new innovative technologies, hospitals can reduce costs without making sacrifices in patient care or satisfaction. Effective implementation of technologies into care plans and staffing models may even deliver a magic pill – improved patient care and satisfaction at lower costs.
Nersi Nazari is the CEO and founder of VitalConnect. VitalConnect is a leader in wearable biosensor technology for wireless patient monitoring in both hospital and remote patient populations with products designed for use in a broad range of inpatient and outpatient settings, such as hospital monitoring, post discharge care, cardiac monitoring and pharmaceutical solutions.