MedHQ pinpoints 10 ways to save big on HR costs

Written by Megan Wood | June 13, 2016 | Print  |

Costly inefficiencies lie in the shadows of the human resources' processes. A professional employer organization could help a surgery center simplify its HR processes, allowing management teams to focus on critical areas, such as patient care. Westchester, Ill.-based MedHQ's CEO Tom Jacobs targeted 10 key areas for healthcare facilities to save on human resources' costs at Becker's 14th Annual Spine, Orthopedic and Pain Management-Driven ASC Conference + The Future of Spine.

Average costs savings are based on MedHQ's 10-Point HR Audit whitepaper research.

 

Here are 10 ways to save:

 

1. 401k: Third-party management, investment fees and registered investment advisors all hide extreme inefficiencies hiking costs. Instead, by packaging these resources into one program, centers will likely see savings averaging between $3,500 and $12,000.

 

"There are services out there that can really drive down your costs if you adopt some of these services," said Mr. Jacobs. "What we often find, is that not only is there a significant asset charge for the advisor, there is a separate fee that the employer pays for these compliance services."

 

2. Health plans: Under the Affordable Care Act, small business market reforms impact many surgery centers. Mr. Jacobs suggested surgery centers partner with professional employer organizations to enhance access and decrease risk. A center could potentially save $5,000 to $50,000, and an employee could save as much as $11,000.

 

3. Paid time off: Employers spend up to 100 hours of administrative work on PTO, onboarding and off-boarding and Occupational Safety and Health Administration reporting, said Mr. Jacobs. To simplify the process, automate it.

 

"Your management team isn't focused on more strategic areas, like relationships with doctors, negotiating contracts and revenue cycle..." said Mr. Jacobs. "If they're distracted by these basic HR processes, there's money being left on the table."

 

Centers could save between $5,000 and $10,000 by automating this process.

 

4. Worker's compensation insurance: Premiums could hit between $3,000 and $25,000 annually, so Mr. Jacobs recommended centers shoot for the lower end of that range. By promoting workplace safety and identifying red-flag claims, centers could significantly decrease costs. A center could save between $5,000 and $20,000 with these strategies.

 

Mr. Jacobs cautioned MedHQ has seen numerous problems stem from employers asking injured employees to return to work too soon.

 

5. Vendor consolidation: Dealing with multiple HR vendors is extremely inefficient. Consolidating will save time, leverage purchasing power and reduce mistakes. Centers could save $2,000 to $12,000 if they consolidate vendors.

 

"Engage an organization that has access to experts your managers can talk with," recommended Mr. Jacobs.

 

6. Open enrollment: By outsourcing the preparation and administration required for open enrollment, centers could potentially save $10,000. Managers will be freed to focus on crucial matters.

 

7. Employee relations risk management: Decrease the risks and costs brought on by Equal Employment Opportunity Commission and labor law situations. By avoiding these costly legal incidents, centers could see average savings between $6,000 and $30,000.

 

"Working with people everyday is a joy, and it can be difficult," said Mr. Jacobs.

 

8. Compensation: A 'water cooler topic,' salary shouldn't be discussed among employees, but Mr. Jacobs said they probably will. "What can be conceived as an unfair compensation structure can get in the way of performance," he explained.

 

This may result in higher turnover, replacement costs and onboarding costs. Instead, establish a fair compensation program, which will yield savings between $4,500 and $54,000 and decrease turnover from nine years to 4.5 years.

 

9. Unemployment claims management: Since wage taxes may vary from 1 percent to 7 percent, negotiate a tax rate percentage. Also, make sure to provide great documentation. This could save centers between $3,500 and $10,000.

 

"It's one of those areas where you can't get huge savings… but these numbers add up," said Mr. Jacobs. "The more you can do to minimize unemployment claims management costs, the better."

 

10. Good culture: Establishing a great culture proves critical to a facility's success and profitability. Define the center's values and permeate them through all aspects of the center, from hiring to staff meetings. Focus on good hiring, compensation plans and benefits. A great culture could save a center between $4,500 and $54,000 because of turnover reduction.

 

"It's a lot for a management team to be on top of all of these processes, everyday," said Mr. Jacobs.

 

More articles on practice management:
Large physician groups show increased satisfaction with EHR vendors; some still frustrated with interoperability issues: 4 takeaways
Opioid use is costing hospitals $15B, 6.5k+ serious infections & more — 5 key statistics on opioid use's toll on our nation's health
DJO Global unveils MotionMD software to enhance clinical productivity: 5 points

© Copyright ASC COMMUNICATIONS 2019. Interested in LINKING to or REPRINTING this content? View our policies here.

Top 40 Articles from the Past 6 Months