December 3, 2022

Ways the Health System Wastes Money

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Hospitals are big businesses that employ a lot of people and have a lot of expenses. Their primary function is to help sick people and perform surgeries, but they are a business nonetheless. Businesses have to monitor and control costs if they are to survive, and hospitals are no different. Even as hospitals increase their focus on cutting costs, they could be losing money in unexpected places. Here are some ways the health system wastes money.

Staff Works Below Their Abilities

In many hospitals, there are medical staff members doing jobs that aren’t in their job description. They are working hard and getting things done but not things they should be doing. Registered nurses (RN) run all over the place doing their work as well as the work of the nursing assistants and supply techs. When they perform duties assigned to nursing assistants, the assistants fill their time by doing support service tasks, creating a “flow-down” effect. The clinical staff is more highly compensated, so hospitals end up paying more for work that doesn’t require medical training. Ultimately, you don’t want to pay an RN to complete work that could be done by anyone.

Readmission of Patients

Poor patient communication is leading to high rates of readmission. Improving patient education and communication will decrease the number of patients coming back for the same sickness. A big part of readmissions is non-compliance with medical directives given at the time of discharge. Patients don’t know what they should do to prevent the same illness from coming back. More attention should be paid to managing patients outside the acute-care setting. This is done by promoting relationships with primary care doctors and increasing patient and family education before discharge.

Not Monitoring Resources

The health system wastes money through supply chain ignorance. Many hospitals have no idea how much they are using and how fast they are going through materials. When someone says “we’re out of” something, more is ordered without checking. No inventory is being tracked and supplies and resources are ordered constantly. Medical gasses are a prime example of this. Technicians and supply clerks guess at how much gas is in a tank. They rationalize by estimating how long it takes to use a tank without actually know how much was in it when it arrived or how much has been used. A simple fix such as a mass flow meter can answer that question and remove all doubt. Tracking the use of supplies and resources with available technology like RFID can eliminate that waste.

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