Healthcare News & Insights

Can outsourcing save your hospital major cash?

Outsourcing

If you’re like the majority of hospital executives, than you’re cutting costs every way you can without negatively impacting patient care. Problem is, you probably aren’t done. It’s projected that most hospitals will have to reduce operating costs by up to 20% by 2020. So what else can you do?

One answer is outsourcing facilities services.

According to Johnson Controls Global Workplace Solutions, an industrial leader that creates products, services and solutions to optimize energy and operational efficiencies of buildings, outsourcing facilities services often can save 15% to 20% across real estate, projects and facilities operating costs within a few years.

Many hospitals already outsource non-clinical functions, such as food services and landscaping, but there are other areas to tackle.

In a whitepaper, Facilities Services Outsourcing for Healthcare, Johnson Controls shares the experiences of companies in the Global 1000 that have outsourced facilities services and the lessons they’ve learned that can be applied to the healthcare industry.

Outsourcing partnership

Currently, outsourcing partnerships are bringing significant benefits, including major cost savings, to industries with highly specific needs like the pharmaceutical industry. The thing you have to realize is that the partnership must be set up in a way that allows the hospital to perform optimally. The key is selecting the right partner.

Look for a company that enables you to focus on what is most important to your hospital — its core mission.

To do that you need to find a company that is familiar with the healthcare industry and has years of experience to back it up.  You also want to find one that offers all the services you require. For example, you want to find one company that can offer services to handle building operations and maintenance, lease administration, project management, facilities strategy, as well as the softer services, such as janitorial and landscaping.

By working with a company with experience, they can offer your hospital best practices for issues like taking care of emergency power systems, and managing sophisticated laboratory and surgical environments.

Open communication

To optimize an outsourcing partnership, there must be open communication that flows both ways. This is especially critical during the planning and transitioning periods.

The company must comprehend the key issues and strategies of the hospital, and the hospital needs to understand the innovations in facilities optimization the outsourcing partner is bringing to the relationship.

This is critical so the outsourcing partner can design solutions that put the right people in the right job at the right time. It’s also essential in avoiding duplication of roles and tasks that drive up costs and limit efficiency.

Making sure the communication remains a two-way street requires the hospital to appoint a mentor. This person should be a well-respected and connected executive — someone who’s intimately familiar with the hospital culture, politics, organizational structure and communication hierarchy.

Ally staff fears

One major issue hospital executives may have about outsourcing facilities services is losing good long-term employees. But that won’t necessarily happen if you find a reputable company.

Good outsourcing partners realize that employees, who have worked for facilities for years, are part of the hospital’s family, and they understand how to interact with clinical staff, patients and their families, which is vital to the success of the hospital and the transition. That’s why most outsourcing companies keep the majority of the hospital’s staff.

Reason: Keeping people who are already familiar with and care about the facility is a win/win situation. The outsourcing company gets staff who can immediately apply their knowledge of and familiarity with the facility. And the hospital’s staff gets access to standardized and up-to-date training that allows them to grow their skills. Staff also get access to proven best practices, tools and technologies to improve their skills and value.

However, in the best interest of your employees, make sure whatever service provider you go with offers similar healthcare, retirement and other benefits that you do so that your employees remain happy, content and well compensated.

Benefits of standardization

Facilities with multiple locations often operate each as a separate entity. Site managers probably decide, according to their preferences, what practices to implement and what tools to use. Outsourcing partners can standardize how all the locations operate, centralizing purchasing, consolidating vendors and standardizing maintenance practices.

Reputable, long-standing outsourcing partners typically have relationships with major vendors, allowing them to buy materials, supplies and services in bulk and at a huge cost savings.

In addition, they can consolidate vendors. At one major healthcare network, an outsourcer was able to go from 1,700 vendors servicing 21 facilities down to a little more than 300 vendors. And in the process they negotiated better pricing for the goods and services they  had been using all along.

And finally, a good outsourcing partner will be able to standardize all maintenance practices under one computerized maintenance management system reducing costs and paperwork.

For even more benefits of outsourcing facilities services, read Facilities Services Outsourcing for Healthcare.

(Image courtesy of Stuart Miles / FreeDigitalPhotos.net)

  • James Adam

    Very insight review. Software based integration also a solution. Proper and cost effective healthcare administrative management in healthcare service such as accounts receivable, accounts payable, payroll and accounting services allowing healthcare service providers to focus on the needs of their patients. Experience the systems and procedures that have diverse need of the industry.

Subscribe Today

Get the latest and greatest healthcare news and insights delivered to your inbox.