Health care reform will change hospitals’ business models, according to a survey of human resource executives.
The survey, performed by global professional services company Towers Watson, found that workforce issues, the need for a wider array of staff skills and new leadership models will rise in importance as the hospital industry grapples with the transformation that will come from reform.
About 93 percent expect cuts in reimbursement levels and 67 percent anticipate a shift in the payer mix, with fewer private payers. Just over three-quarters agree they will need a wider range of skills among their staff and another three-quarters expect a higher ratio of out-patient to in-patient care, as well as an increased need for primary care capabilities.
“A perfect storm of forces is hitting the hospital industry all at once,” said Heidi Toppel, a Towers Watson senior consultant. “Industry executives have no illusions about the extent and magnitude of the forthcoming change. But the scope and complexity can be daunting, especially since hospitals have to rethink and refine core business and operating processes while continuing to deliver quality care to the communities they serve. Many executives recognize the transformation required to meet the vision of multidisciplinary accountable care will ultimately help improve health outcomes and reduce costs. However, the path from the current to the enhanced state won’t be a smooth one in the short term.”
The survey findings demonstrate the need for fresh thinking and approaches to delivering care efficiently and effectively, Toppel said. In terms of their top three greatest business challenges over the next two to three years, respondents cited managing costs (72 percent), improving quality of care (56 percent) and managing changes in the payer mix (25 percent). Far fewer, though, cited collaborating with local providers on community health and wellness services (18 percent), arguably a critical focus for the future. On the other hand, most respondents (90 percent) saw customer service as a far stronger competitive factor n the next three years..
Talent Gaps Loom
The survey found that most respondents aren’t currently experiencing serious labor shortages, and believe turnover and retirement are ideal or manageable today, although two-thirds reported slight to moderate shortages of physicians and nurses. However, most respondents anticipate additional shortages over the next two to three years, with the biggest gaps expected in patient-facing roles. More than two-thirds of respondents (70 percent) expect shortages of bedside registered nurses to increase moderately to significantly. These projected shortages help explain why, looking ahead two to three years, respondents cited concerns about staffing risks to a far greater extent (71 percent) than they did either financial risk (52 percent) or operational risk (39 percent).
“We expect a sizable percentage of experienced physicians and nurses will likely retire over the next decade, potentially creating a diminished supply of clinical staff down the road,” said Toppel. “The danger is that today’s glut of recent medical and nursing school graduates could mask this looming problem, so hospital HR executives can’t take their eyes off the talent management ball if they want to ensure they remain competitive in the labor market. What’s more, there can be advantages for hospitals in using this current period of relative labor market calm to prepare young, new clinical hires for the challenges of the next few years, assuming more experienced clinical employees are available for mentoring.”