Achieving the break-even point on Medicare is not only an important goal in itself for many healthcare organizations in need of cost transformation, but also a driver of overall efficiency and cost savings. While many hospitals and health systems struggle to achieve it, one system has succeeded in reaching and maintaining Medicare breakeven, despite the fact that government payers make up more than 75 percent of its gross payer mix.
Benefis Health System in Great Falls, Mont., relies on multiple factors to maintain Medicare breakeven, but one of its primary strategies has been to focus on improving productivity.
Following are examples of how to improve a hospital or health system’s productivity:
- Eliminate premium labor/change skill mix
- Reduce overtime—incidental, scheduled and other
- Evaluate on-call need, alternatives and usage
- Evaluate education and orientation needs/programs
- Use flexing and nontraditional shifts (e.g., adjusting staffing every four hours)
- Float staff to similar units/share staff
- Consolidate positions/cross-train
- Create flexible core staff—a mix of full-time, part-time and per-diem
- Do schedulable work during predictable slow periods
- Eliminate nonvalue-added work
- Fill overflow work by finding a department with capacity rather than using overtime (e.g., establish sister units for patient placement)
- Plan vacations/paid-time off to predictably slower periods
Source: Benefis Health System, 2019