Healthcare Workforce Solutions: Purchase Order that Solves Staffing Problems
Hospitals and health systems can meet their complex staffing challenges by looking to an approach they already understand well in other parts of daily operations – knowing when to buy instead of build.
Outsourcing makes sense when you can acquire greater efficiently, higher quality and lower cost through external products and services compared to internal capabilities. It’s a natural extension of everyday purchasing for the healthcare enterprise. From mops to imaging machines, no hospital could create those items in-house as well or as inexpensively as companies with specialized capabilities on a large scale. Yet, it has been a relatively recent development that hospitals have looked outside to tackle their industry’s single biggest operational expense -- the roughly 55% of operating budgets going to clinical and nonclinical staffing.
Finding the right healthcare professionals, in the right numbers at the right times, is especially challenging today – and will become more difficult in the future. By the numbers, the overall recruitment challenge in healthcare is severe. According to data from the Bureau of Labor Statistics, there are currently approximately a half million unfilled healthcare jobs, and this trend is expected to worsen. Contracting for services that provide recruitment and placement expertise and optimize the current workforce are becoming increasingly important to purchasing departments.
Healthcare MSP: Service that Shows Value
Managed services programs, or MSPs, are perhaps the best known examples of human resources management outsourcing. The healthcare MSP frees organizations from the management and administration of all the services required for contingent staffing. As Modern Healthcare reported last year, “Some hospitals and health systems are turning to the MSP model so they don't have to dedicate as much time and resources to finding qualified professionals.”
MSP use in healthcare pales in comparison to other industries, especially in information technology. But there are parallels that suggest hospitals, health systems and other healthcare facilities would be smart to follow that industry’s lead. In IT, as in healthcare, contingent labor is an established part of the industry: the battle to find the best trained workers can be fierce, and the need to adjust to changing conditions is the norm. Better management of contingent labor is becoming imperative in healthcare.
Workforce Services Expand as Industry Challenges Evolve
Other workforce solutions available to purchasing departments at hospitals and health systems include recruitment process outsourcing, or RPO, which provides specialized recruitment resources to fill permanent professional positions on a project or enterprise-wide basis.
As the healthcare industry continues to evolve, services to support healthcare providers in solving their workforce challenges are constantly being developed. In addition to MSP, RPO and predictive analytics, other services available for delivery include vendor management systems, or VMS, which automate administrative and other processes for managing contingent clinical staff.
Services to fill critical vacancies in healthcare leadership on an interim or permanent basis also are available, and so are services for vital medical coding and health information management. Meanwhile, customized expert services for recruiting and placement have developed into a valuable expertise as the supply and demand imbalance worsens for healthcare professionals.
The implications for clinical capability and quality are obvious. Yet, increasingly, it is not only a question of institutions providing top-quality care, but also being recognized for doing so by patients and payers. Staffing is a critical factor in patient satisfaction, which is itself a critical factor today in reimbursement and competitive advancement. Research shows that interactions with physicians, nurses and other healthcare professionals has a far greater impact on patient satisfaction compared to inpatient facilities and amenities.
Purchasing Department Scope Now Includes Workforce Solutions
The goals of clinical capability, quality and patient satisfaction, while fundamental, are not immune to budget considerations. In workforce solutions experience at AMN Healthcare, an MSP has cut contingent staff expense by as much as 20%. RPO produced similar levels of savings. The use of predictive analytics of future patient demand and staffing need can result in a year-over-year reduction in staffing expense of up to 7%.
The strategic decision to buy or build in the healthcare industry now clearly pertains to purchasing services that optimize the healthcare provider’s workforce. And, this decision has become much more important as shortages of healthcare professionals and demand for patient services both continue to grow. In purchasing such workforce solutions services, rather than trying to do it all on their own, healthcare providers can focus their energies and resources on what’s really important – quality patient care.