The healthcare industry is facing unprecedented challenges, particularly around labor. Balancing labor expenses with workforce shortages and increasing competition to fill non-clinical positions requires a new approach to operations.
During a session sponsored by Syntellis at Becker's 10th Annual CEO + CFO Roundtable, Steve Wasson, executive vice president and general manager of data and intelligence solutions at Syntellis, discussed how effective productivity and compensation analytics can help healthcare leaders maximize limited resources.
Three key takeaways were:
- Nationwide trends in healthcare labor metrics are driving the demand for intelligent insights. Business disruption due to COVID-19 has now shifted to financial and operational issues, which are being impacted by inflation and labor shortages. Since 2019, operating margins have declined from -1.5 percentage points to -4.3 percentage points today, while both labor and non-labor expenses have risen more than revenue.
In this environment, although high performers have found a way to manage through volume fluctuations, most hospitals are struggling with labor expense per unit. "Volume [is an issue] due to the migration that happened during COVID . . . all of a sudden, we have growth we never thought we'd see," one participant said.
Changes in the market have also increased competition for non-clinical labor with industries outside of healthcare. These factors and more have created a challenging business environment and are driving demand for comparative insights into labor and productivity. To deliver the most effective insights, multiple metrics must be taken into account.
Syntellis offers financial planning solutions that provide comparative budget insights based on a high volume of robust, real-world data drawn from 1,300 hospitals and 135,000 physician organizations throughout the United States. With Syntellis, healthcare administrators gain a near-real-time understanding of how their organization compares with others in the market, which helps them make better decisions for their specific business needs. "The data is telling you a story. How do you apply it? How do you think about it?" Mr. Wasson said. - As margins continue to decline, shifting operations based on data is critical to survival. Syntellis publishes a monthly report, Syntellis Performance Trends, containing high-level key performance indicators that measure the state of the healthcare market. A recent issue of the report included ranges from high to low performers for detailed metrics at multiple levels, helping track performance based on priorities specific to a given organization.
Although the report focuses on high-level KPIs, the data behind the Syntellis engine is extremely granular. Syntellis IQ, the underlying machine learning framework of the Syntellis solution, uses detailed, extensive data to map and categorize attributes of departments with similar operational profiles. This unique categorization results in more accurate market measurements and is continuously refreshed to ensure accuracy of comparison.
The Syntellis ML and AI engine recognizes and adapts to operational changes as data are updated. "Historically, people have to change themselves to the world," Mr. Wasson said. "We do it the other way around. We change the world to you so you can build confidence with these conversations. And you can only do that with automation." - Organizations have successfully used Syntellis comparative insights to meet labor challenges. For a multi-hospital health system in the Midwest, Syntellis real-time market information showed increasing contract rates every month. The group was coming up on a contract labor rate renewal. With knowledge about how contract rate increases were trending in the market, the health system used Syntellis data to lock in a new rate that resulted in significant savings — over $75 saved per contract hour at the highest point of the market rate.
Another group also faced attrition challenges in their nursing staff. Syntellis real-time data helped avoid a crisis by providing data demonstrating that the health system was paying its nurses slightly over market rate.
Using the power of machine learning and artificial intelligence, Syntellis's near-real-time analytics on productivity and compensation helps healthcare leaders adapt to meet the increasing labor challenges of the healthcare market and beyond.