Strategies to minimize the impact of inflation across healthcare

Inflation is everywhere these days. Whether geopolitical conflicts or the collapse of global production and supply chains, no industry is spared from rising costs. And while the healthcare industry has been slow to feel its impact — healthcare inflation was around 2% in November 2021, compared to 7% nationally — even here it has risen steadily since September 2021, reaching a new peak in September 2022.

I have previously dealt with the inflationary forces at work in healthcare, from labor costs to drug prices. But there are other factors influencing the current healthcare revenue cycle. For example, many patients are delaying care, either due to expenses or ongoing concerns about COVID, resulting in a drop in hospital revenue. This is particularly problematic at a time when healthcare systems are already under fire for a lack of pricing transparency.

So what can be done?

Of course, there are no easy answers that can solve inflation, nor do we know how long this period of inflated prices will last – this issue could keep us busy for a few months or a few years (subscription required). But that doesn’t mean healthcare organizations don’t have options. Executives looking to mitigate the impact of inflation should stop trying to find a “magic bullet” and consider several potential cost-saving strategies.

1. Improve staff efficiency.

I’ve already talked about how healthcare organizations can improve efficiency and limit turnover, such as ensuring that your specialized healthcare professionals are using their skills and gifts appropriately and not on cleaning or clerical work. If you haven’t already, now is the time to look for ways to integrate automation, such as: B. through patient access, reminders and payment/collection.

2. Maximize sales by allaying potential patient concerns.

As previously mentioned, the healthcare system has not yet felt the full impact of inflation, meaning it is in the best interest of our patients to seek treatment sooner rather than later. Greater pricing transparency, easier planning and billing, helping patients navigate their coverage, and a commitment to pandemic-related safety can reduce patients’ reluctance to seek treatment.

3. Build relationships within your community.

In economically tense times, consumers are particularly cost-sensitive and quickly accuse institutions of price gouging. It may not be possible to completely shield your organization from criticism, but the more you can show that you care about the people you serve and are a trusted resource in the community, the less resistance you might get from people who need care.

4. Dive into your organization’s analytics.

When profit margins are razor thin, you don’t want to pay for labor resources that nobody is using. Consider taking a closer look at what care your community needs and when it needs it. Are there hours, days, or weeks when patients seek help (or not)? Are there any services you offer that your community doesn’t take full advantage of (or don’t even know you offer)? Or how about the other way around: Are there any services that you don’t yet offer that your community would benefit from? In times of high inflation, it’s crucial to eliminate as much inefficiency as possible – resource management is another area where artificial intelligence could be useful.

Final Thoughts

Inflation is a problem that will likely persist through 2023, if not longer (potentially much longer). The better healthcare organizations can plan and prepare for this time of increased costs, the better off they will be when we emerge on the other side.