Dec 21IssueOpinion

Outsourcing – The future in healthcare

The high attrition and the need for continuous training have forced hospitals to look for manpower from the outsourced agency. Dr Naresh Shetty, President – Healthcare Vertical, Quess Corp

A small virus changed the whole world and every single human being has been affected in some way or the other in this pandemic. Healthcare services were overwhelmed with unknown challenges and  suffered  extensively.  Most  of  the  hospitals found themselves helpless and inadequately prepared. The war was fought with an invisible enemy and with  inadequate  knowledge. The  only  positive  part  of  the  pandemic  was  the  acceptance of technology in healthcare which expanded and supported the clinicians in their work.


Another area that grew rapidly in  the  last few years and more so, during the pandemic was the outsourcing of some of the hospital activities. It allowed the  hospitals  to  focus  on  critical  areas and allowed the hospital administrator  to  focus  on  patient  care  and  disease  outcomes. The burden of managing non-core  areas  was  left  to  the  reputed  agencies  who  could  train  and  deploy  manpower as well as services.

Healthcare services require a huge talent pool of manpower and today employs  one  of  the  largest  workforces  across  the  industry  in  the  world.  The  need for this workforce is continuously growing  but  there  is  a severe  shortage  of skilled manpower, which is so critical in the hospital industry. The high attrition and the need for continuous training have forced the hospital to look for manpower from the outsourced agency. Despite the shortage of talent, the hospital lagged behind most others in its adoption of outsourcing.

As the industry becomes more competitive, health organisations must learn to deliver excellent patient care without increasing costs. Unfortunately, providing excellent care requires substantial manpower and resources. The only way out is that they outsource skilled manpower to overcome a few challenges.

Why outsource?

The critical part of any hospital is maximising staff efficiency and improving patient care outcomes. To achieve this goal, outsourcing non-core functions can be a blessing. It helps hospitals in focusing on their core operations and services like clinical diagnosis, medical care and nursing support.

The challenges for outsourcing:
· The financial and operational implications because of outsourcing
· Areas and tasks to be outsourced
· Seamless transitions from internal to outsource model
· Retaining of good manpower

Services for outsourcing

Today’s healthcare outsourcing sector handles a variety of functions ranging from data entry to medical claims processing to medical billing.

However broadly, it could be clinical and non-clinical:
· Clinical services could be diagnostics/ rehabilitation or support services like pharmacy or home care.
· Non-clinical services could be IT related/Billing/Insurance /Facility management / Security & patient Transport

Advantages of outsourcing
Cost reduction – Outsourcing certain activities in the hospitals can save significant costs and improve margins

Access to skilled Manpower – Availability of trained or skilled manpower will improve the process besides reducing  costs. More importantly, it will improve patient satisfaction level, a benefit that is so valuable and intangible. Improved focus on patient care – Medical professionals can focus on the core patient areas and allow non-core areas to be taken care of by an outsourced agency

Reduction in hiring and training costs
– This will decrease the new hiring, training and retention of skilled manpower by the hospitals.

Improved patient experience: since non-core areas will be manned by trained manpower it will improve efficiency and patient experience.Decrease in administrative costs– A significant amount of administration cost can be brought down and the savings could be reinvested for improving or adding new services.

Some of the most critical areas in hospitals that require serious review are high attrition rates, limited skilled or talent pool and the need to make healthcare competitive. There is also a need for hospitals to make healthcare affordable, however, the cost of healthcare has risen prohibitively across the world and the income flow has decreased over some time. Some surveys have predicted that the average hospital will need to reduce costs by 15 to 20 per cent just to survive the crisis.

Other major issues are finding highly skilled manpower and that outsourcing can help to bridge that gap. It helps the hospital to focus on making patient care better. The flipside would be it helps in  increased productivity, greater worker’s satisfaction, decrease in training costs and, ultimately reduce the overall costs. It is time that hospitals look at outsourcing as a necessary evil for the greater good as seen in other service industries. The increasing need for minimising critical mistakes, reducing operating costs and delivering better services will drive market growth. Now is the time for hospital administrators to think and act before it is too late.

However, it needs to be well thought of the response and not a knee jerk reaction.

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