A revenue cycle is a system used by healthcare facilities to track revenue or money paid to the facility by a patient for services offered. It involves receiving, recording, and managing client revenue by the healthcare facility. Before looking at how to boost profitability, it’s crucial to address the problems that face the healthcare sector, which include:
- High Administrative costs
- Lack of transparency
- Poor patient relations
- Poor service delivery systems
- Lack of holistic approaches to patients’ health
- More affordable and accessible healthcare services
- Cybersecurity threats that endanger consumer privacy
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How Do You Boost Profitability in a Healthcare Set Up?
Holistically, the most important consideration is providing quality and affordable services to every patient, but the institution requires revenues to offer quality healthcare, remain competitive, and manage its workforce. To achieve this, it must
Reducing the cost of supplies ensures you work with vendors that offer the best prices and experience. It’s okay to negotiate for better prices or check what other suppliers provide. For instance, if you check scrub caps at Uniform Advantage, you may end up getting a deal you wouldn’t find anywhere else. Apart from the cost of supplies, reliability is an important consideration. Does the vendor deliver on time, offer transport services, and is the quality of the products guaranteed?
Reduce Staffing Costs
Staffing is a central pain area for most healthcare providers. It is the costliest or most expenditure demanding area in an organization. Facilities may have too many workers or not enough, but how do they hit a balance? It’s essential to evaluate the daily staffing needs of the facility and adjust accordingly. It may mean having hourly, daily, and shift employees. The arrangement ensures you have enough staff in every season, and you don’t pay monthly apart from the critical staff members but per work input. To achieve this, hospital leaders should work together with physicians and departmental managers.
Involve the Physicians in Cost Cutting
Cutting costs should not be an exercise implemented by the leaders alone, but everyone in the facility should understand and do their part in implementing the strategies. Physicians should be concerned about inefficient procedures that raise hospital costs, such as inefficient coding processes. They should also work together with the stakeholders to bring down the cost of supplies without compromising the quality. When hospital staff is involved in the exercise to boost profitability, they will be more cautious not to make cost decisions that may hurt the hospital’s goals.
Better Utilization of the Operating Room
Ensuring physicians use the operating room for the time allocated to them ensures the facility remains profitable, promoting efficient service delivery and customer satisfaction. For this to happen, physicians should make early bookings and keep to their allocated time slots.
Reduce Unnecessary tests
According to a survey where 2106 doctors from the American Medical Association participated, it was found out that 20.6% of medical care was unnecessary, including 24.9% of tests. Unnecessary tests lead to at least $ 200 billion in wasted revenue every year. Health facilities can avoid this by not rushing to conduct tests even when the patient requests but get to know the patient better. Good patient-doctor communication, checking patient medical history, and using quality systems can reduce unnecessary tests.
Physicians should spend a considerable amount of time getting to know the patient’s condition from talking to them. They should make the patient comfortable expressing their feelings, pain points, past illnesses, and remedies. An effective testing system carried out by experts may also help reduce unnecessary tests.
Boost Patient Satisfaction
Probably this is the most critical consideration because happy customers mean repeat business. Customer satisfaction starts at the reception area to other departments in the facility. When there is good communication, efficient service delivery, experienced and reassuring physicians, and comfortable amenities, the patients are more likely to refer back to the facility in the future or recommend it to others.
Customers should not wait for long to be attended to or deal with a lot of paperwork. There should be amicable conflict resolution strategies and, most importantly, quality and efficient health care services. Quality service delivery is achieved when you have qualified, experienced physicians and equipment. Patients don’t want to be rescheduled or transferred to other facilities because the equipment broke down or the facility lacks enough doctors.
Automation means you need less workforce to perform tasks or supervise. Automation also leads to efficient service delivery and centralized operations, which means less paperwork and time. By keying in a repeat patient’s ID, physicians can retrieve their health records, leading to faster service delivery. Patients don’t have to fill paperwork every time they visit the facility unless when signing consent forms. Apart from better service delivery, there is less paperwork and no need for large storage areas for storing records.
Departments work more smoothly because they don’t have to wait for feedback but can log in to the system and get the required information. When a patient is referred from one department to another, they don’t have to carry paperwork or explain themselves, but the staff can check into the system for the required information.
Invest in Efficiency
Efficient equipment ensures faster and reliable service delivery. When the radiography equipment breaks down, all the MRIs, Ct scans, and x-rays scheduled for the day have to be postponed or done elsewhere. To avoid this, all devices should be
Well maintained including proper cleaning and storage
- Adequate maintenance procedures carried out regularly
- Periodical inspections carried out by a professional
- Faults addressed on time
- Replacements are done when necessary
- Only experienced staff members allowed to operate the equipment
Address Energy Consumption Issues
Energy costs can result in a massive expenditure for any organization. It’s essential to have a regular energy audit and implement the findings or suggestions. The leaders in the institution should sensitize all staff members and involve them in measures that cut energy costs, such as
- Using natural light rather than bulbs during the day
- Switching off devices when they are not in use
- Using smart devices and lights that go off when not in use
- Using the hibernate option on all devices such as computers
- Changing from the use of computers to laptops which use less power
- Cleaning ventilation ducts and controlling all heating and cooling devices.
- Invest in energy-efficient appliances and equipment.
Old and faulty equipment uses more power compared to newer versions. To avoid this, don’t use faulty equipment but make sure they are fixed on time; although when they keep on breaking down, replace them. A system upgrade can save the facility over 15% in power bill reduction.
It’s essential to note that you are saving the institution revenue and addressing global warming issues when conscious of energy consumption issues. Aim to use green energy by installing solar panels, which are easy to install and low maintenance. You will be contributing to making the world a healthier, cleaner place for all humanity.
Outsourcing ensures you have available experience and equipment onboard without going through rigorous recruitment or investment processes. It also improves efficiency. A healthcare facility can outsource some sections, such as catering, cleaning, finance, and human resource. Outsourcing helps the leaders concentrate on revenue-generating sectors and offer the customer a better experience. When outsourcing, make sure the contract goes to highly efficient, experienced, and qualified organizations. Outsourcing means you will not have to invest in costly system upgrades, professional human resources, or training current employees. You will also not have to invest in employee salaries and benefits and deal with the headache of replacing employees.
Readmissions can be costly to a hospital, and it’s crucial to avoid them when possible. High rates can also lead to penalties from concerned bodies such as the Centers for Medicaid. There should be efficient communication between all involved sectors, improved follow-up care, and proper patient data management to prevent readmissions.
Reduce Staff Turnover
Hiring is costly but maintaining employees not only boosts customer experience but saves the institution revenue. There is the cost of outsourcing and training and evaluating new employees, not forgetting it kills morale. To avoid this, hire the right employees—people who have the skills that match the available positions. Additionally, have favorable or flexible work schedules, offer competitive benefits, and help them build their career. Employees are more likely to stay in a company where there is growth instead of stagnating in one position for years. They also feel more appreciated when their work is valued, they have favorable working conditions, and teamwork is encouraged.
Motivated employees offer more than is expected of them. They value their work and the company, making them work harder to ensure the facility remains relevant, competitive, and profitable. Patients also feel more comfortable having physicians and employees they have built a relationship with while attending to them.
Boosting a health facility’s profitability is a conscious everyday decision by all the stakeholders. It involves reevaluating current systems and adopting new strategies that increase profitability. However, making profits should not outrun the objective to provide quality healthcare to all.