Yet those kinds of wins might be a little more difficult for smaller players. Perhaps that’s why nearly half (49%) of survey respondents told us they still have 6% or more to trim from their operating budgets. Another 49% saw their targets as less than 6%, while 2% feel like they’ve already achieved the savings they will need.
Because of expected reimbursement declines, it’s critical that not all of the savings from cost containment programs be plowed back into other spending. That said, perhaps better buy-in might be obtained if organizations involved in cost-cutting programs were inclined to share some of the gains. Some 48% of respondents do not share savings at all among stakeholders, while 30% say the direct benefit accrues at the facility level. Only 19% either use some of the savings for implementing a bonus structure for participants or that use a percentage of the savings for discretionary reinvestment in that department.
That is an area for the industry to explore, and one that might put it more in line with traditional economic rules. Because while healthcare leaders say programs that eliminate waste and reduce cost are not harming clinical outcomes and patient satisfaction, employee satisfaction does take a hit, with 37% of respondents saying the metric declines under the influence of such programs.
Perhaps a little sugar, in the form of sharing the savings, would help the medicine go down a little easier.
This article appears in the November 2011 issue of HealthLeaders magazine.