To be successful, health systems will need to coordinate dozens of interrelated initiatives all at once, with blistering speed and at scale. Fortunately, the framework to achieve financial sustainability (described above) is flexible. It can be applied at the macro level to the overall journey to financial health, as well as to individual operational challenges facing organizations, like being over capacity.
Optimize operations
In today’s climate, traditional optimization of operations is still critical to cutting costs, capturing savings and improving margins. Health care organizations should begin by evaluating their overall operational efficiency. There are several opportunity areas where organizations typically find success optimizing operations:
- Evaluating spans and layers of an organizational structure
- Optimizing supply chain channels and relationships with vendors
- Addressing referral management and patient access
Most hospital operators know these levers of performance improvement and have employed them as tried and true methods for reducing costs and improving revenue capture. But today’s problems cannot be solved using yesterday’s tools alone.
Restructure the model
While optimizing operations is essential for reducing costs, the willingness of an organization to rethink and restructure its business model will be essential to address long-term financial stability. Many health care systems have grown through acquisition and new partnership models, which if not integrated thoughtfully can lead to inconsistent governance, misaligned incentives and suboptimal physician enterprise operations, from primary care providers to acute and post-acute sites of care. These dynamics create time and resource waste, which create unsustainable financial conditions and negatively impact patient experience.
Organizations can mitigate some of these concerns by:
- Reorganizing programs to break down silos between acquired entities
- Outsourcing noncore business functions or creating highly effective shared services functions
- Scaling focused acquisitions to adopt transformative technology platforms
This can help pave the way to delivering a superior, digitally enabled experience for providers and patients.
Advance with digital
Digital enablement has allowed organizations across every sector to deliver personalized experiences at scale, drive standardization, and create operational and economic efficiency. Leading health enterprises are already advancing with digital and analytical capabilities to understand, predict and better address patient needs; improving employee experience by automating redundant, non-value-added tasks; and creating new care pathways and access points via digital solutions and devices.
Leverage key technology enablers by:
- Automating workflows in the back and front of the house using intelligent automation and robotic process automation
- Standing up remote monitoring across inpatient settings
- Pushing care to the home through virtual care and “hospital at home”
Organizations must balance the complexity of implementing technological solutions with their organizational operational readiness. Implementing digital solutions requires thoughtful analysis of current opportunities and enablement of foundational capabilities. Done well, these capabilities support financial sustainability while positioning organizations to be on the leading edge of health care.
To help illustrate how we’ve seen providers succeed in their transformational journeys using the financial sustainability framework, here are some common examples of situations that health systems face.