When it comes to sectors feeling the strain of financial pressure, spare a thought for the men and women charged with overseeing our healthcare services. As life expectancy climbs and demand for treatment of chronic diseases and illnesses continues to soar, hospital executives have known for a long time that their cost structures have become unsustainable. A 2018 survey found the average hospital needed to reduce its costs by 24% by 2022 just to break even, with the flow of income from governments, patients and health insurance providers not enough to meet the shortfall.
And the concerning thing? These studies were conducted before the world had even heard of COVID-19.
While the global pandemic has taken a devastating human toll, it is also proving to be a financial nightmare for an already stretched healthcare system. Respected management consultant McKinsey & Co has reported the U.S. health system is incurring about $5.3 billion in direct cost for every million people that seek treatment for COVID-19. Then there are the additional layers of delayed or indirect impact, which the firm says could cost the U.S. health system $125 billion to $200 billion each year.
With global healthcare spending projected to reach more than $10 trillion by 2022, the challenges facing the industry are immense. The battle for the healthcare dollar has never been more fierce as non-traditional players enter the market. Antiquated technology systems also continue to be a drain on resources, with one report saying they result in U.S. hospitals absorbing at least $8.3 billion each year.
The expectations of patients are changing too. Consumers want the capacity to book appointments and make inquiries outside office hours, while greater access to information and choice is creating an environment where they demand more when it comes to service delivery and cost. Labor costs are also increasing, not to mention digital innovation creating a need to recruit healthcare staff that possess modern skill sets in areas such as medical billing, data management, bookings and compliance.
Given such significant challenges, it is no surprise to learn hospitals are turning to top healthcare outsourcing companies to reduce costs and maintain excellent patient care. Despite being one of the biggest industries in the world, healthcare has until recently lagged behind others in its adoption of outsourcing but, like so many business leaders before them, hospital executives are realizing the positive impacts of outsourcing are too great to ignore.
For proof, look no further than the Black Book survey of leaders from 545 hospitals and inpatient organizations that found 90% were considering outsourcing clinical and non-clinical functions to achieve cost effectiveness and succeed in value-based care models. And while most share a common motivation for doing so, there are various reasons why healthcare outsourcing appeals to the modern hospital executive.
Outsourcing hubs such as the Philippines can offer hospitals access to quality candidates to fill various roles across the healthcare spectrum, allowing medical professionals to focus more time on providing care for their patients. For further insights, here are examples of roles which can be easily outsourced in the healthcare sector:
From humble beginnings, there is little doubt that attitudes towards outsourcing in the hospital sector have shifted. The aforementioned Black Book survey found that barely 2% of hospital and inpatient leaders believe outsourcing is an “unthinkable option” because of the expected reaction of staff, physicians and the community. The benefits of easing the load on busy in-house staff and allowing them more time to focus on their primary role – patient care - are simply too great to ignore.
The global pandemic has highlighted the financial, operational and safety challenges that have impacted the healthcare industry for decades. With more change on the way, learn about the top trends that have been accelerated due to COVID-19.
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