Talent Acquisition Technology to Reduce Healthcare Labor Costs

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Over the past few decades, healthcare organizations have experienced financial uncertainty due to lower reimbursements from payors, higher acuity patients and growing competition from rival facilities. Because of this, healthcare organizations are continually brainstorming new and creative ways to reduce costs. Considering registered nurse wages and benefits constitute the largest portion of overall labor costs, organizations have attempted to reduce nurse staffing as a means to reduce costs and increase profitability. However, studies have shown that adequate nurse staffing correlates with better patient outcomes without negatively affecting financial performance.

The correlation between healthcare staffing and quality of care has received significant attention during discussions to reduce labor costs. Studies have shown that a higher proportion of nurses was associated with lower mortality rates and a lower proportion of nurses increase the rate of adverse events (pressure ulcers, urinary tract infections, falls, significant injury and weight loss). Turnover, burnout, job dissatisfaction and intent to leave have all been linked to nurse-to-patient ratios and unfortunately, 33 percent of acute care hospitals report a nurse vacancy rate greater than 10 percent. This percentage is much higher in long term care facilities. In these situations, labor costs rapidly inflate when overtime, shift bonuses and agency labor become necessary to meet adequate staffing ratios. Personnel shortages remain one of the greatest concerns for the healthcare industry. Operators must embrace and engage in changes in the market.

An estimated 1.2 million more registered nurses and over 70,000 more physicians will be needed to adequately staff the healthcare industry within the coming years. Innovation within traditional staffing models has become existential to adequately staffing the industry. As the demand for healthcare administrators and managers rise, there will be many job functions augmented by technologies from chatbots to artificial intelligence and virtual reality. Automation technology will make simple manual tasks (such as staffing) less cumbersome. Tech-based programs are the preference of the future workforce.

As the current workforce nears retirement age, millennials — those born between 1982 and 2000 — will soon make up the majority of the workforce. According to the Pew Research Center, they have already outnumbered other generations and now account for the largest segment of the labor market. Millennials are destined to become a major force in healthcare but are also characterized by a remarkable absence of loyalty to their workplaces. Two out of every three respondents of a recent survey expect to have left their current employer by the end of 2020 to join a new organization or work in a different field. The turnover rate in healthcare is one of the highest in the nation.

With restless millennial workers soon dominating the workforce, healthcare organizations will need to adapt to their needs and preferences and utilize a tech-enabled platform to complete tasks. Millennials are tech-savvy and digitally connected, with 77 percent of them reporting a desire for greater mobile connectivity in the workplace through devices such as tablets and smartphones.

A significant percent of young workers considers work-life balance as one of the strongest factors to continue work in an organization. Unfortunately, a growing number of healthcare professionals are leaving the industry entirely. For those who are staying, it appears that finding per diem or “as needed” work has been the most suitable option for their lifestyle. According to the American Journal of Nursing, 7.8 percent of nurses licensed between 2004 and 2005 work part-time, whereas 10.5 percent of nurses licensed between 2010 and 2011 work part-time, which suggests a growing preference toward part-time and per diem work in the healthcare.

To cushion the blow of high turnover rates and consistent vacancies, many healthcare organizations resort to overtime and temporary staffing agencies to cover open shifts. According to a survey from the KPMG Healthcare & Pharmaceutical Institute, seasonal needs, local nursing shortages, and volume growth are the key drivers for hiring contingent nurses, with 65 percent of respondents making use of traveling or per diem nurses on a regular basis. Temporary nurses now account for 9 to 10 percent of the healthcare workforce; meanwhile, staff nurses still accrue up to four hours per week of overtime each, a significantly higher expense than employing part-time, per-diem nurses to cover those additional hours.

In order to maximize labor productivity and increase overall operational value, healthcare organizations will need to reduce their dependency on staffing agencies and overtime.

New strategies around retention to reduce attrition, and supplemental labor to deepen the contingent pool are being implemented across the country. While hospitals have been offering costly incentives to retain talent (tuition reimbursement, retention bonus, student loan repayment) for years, the use of a highly engaged and skilled contingent workforce, on a permanent basis, has become more popular at small and large organizations.

Talent Acquisition Technology has become a critical tool for many healthcare organizations and has been a key driver of the enhanced efficiency, compliance, cost rationalization, and transparency of the modern contingent workforce. This technology can be grouped into five broad functions: Systems of recovery, Candidate discovery, Candidate assessment, Candidate engagement and Candidate verification. Artificial Intelligence plays a key role in technology-based recruitment strategies.

Talent Acquisition Technology is the smallest segment of the Workforce Solutions Ecosystem though likely the fastest growing given the ongoing development of the Human Cloud and other technology provision.

· Systems of Recovery allows for an applicant tracking system, vendor management system and access to workforce analytics. Software integrators allow different technologies to talk to each other. Overall, systems of recovery allow healthcare organizations to make wiser hiring decisions based on data. The automation potential of recruitment activities can save healthcare organizations time and money.

· Candidate Discovery helps organizations find candidates for hire and in Provider Pool’s case, through an online marketplace. In this model, users freely buy and sell contingent labor. Candidate discovery technology includes variants of job or shift advertising, human cloud, sourcing automation and employee referral technologies.

· Candidate Assessment allows healthcare organizations to assess qualifications and validate skills and experience. Automated HR processes such as background checks and credentialing will speed up the assessment phase of the hiring cycle. Provider Pool includes psychometric assessments, skills assessments and interviewing platforms.

· Candidate Engagement allows hiring managers to stay productive in communicating with potential candidates. Texting/Email and chatbots save time and appeal to the millennial workforce.

· Candidate Verification is generally the last step in the hiring cycle and has been historically a labor-intensive process due to fragmented nature of record keeping standards in different jurisdictions.

Many hospitals and other healthcare facilities have attempted to build their own PRN pools. Building and managing a personal PRN pool is a lengthy and resource- intensive process for facilities, ultimately costing as much as hiring and training permanent staff. Workforce Solution tools are now offering a better way to optimize the use of an internal resource pool by facilitating the forecasting of workload and staff scheduling. In addition, bridging the gap to an external pool of vetted and skilled local nurses via emerging, on-demand online marketplaces and extending facilities’ own pools with this external talent network without agencies may offer cost-effective and reliable staffing options. On-demand marketplaces attract nurses looking for an occasional shift.

23 percent of nurses ages 55 and older are expected to change their work habits dramatically, including opting for retirement or leaving the nursing field for other types of work. In so doing, they take their valuable skills and competencies permanently out of the market. This available talent pool can help deepen hospitals’ own resource base, mentor newly graduated nurses, and cover hard-to-fill shifts at a fraction of standard agency fees.

In today’s healthcare reality, lean, affordable, and reliable staffing is vital to maintaining healthy financials. Even a small reduction in overtime or agency use, or an increase in the timely and efficient management of a facility’s own pool, can make a positive difference and improve the hospital's’ margin.

In addition, mandatory overtime and prolonged shifts can impact quality of care, patient safety, and job satisfaction. These factors, combined with floating and shift cancellations, contribute heavily to discontent and higher turnover among nurses. The search for and hiring of temporary talent can now be automated substantially, ultimately reducing time allocated to managing scheduling issues and filling recurrent open shifts.

New on-demand, mobile staffing platforms with sophisticated algorithms can now notify pre-vetted and qualified local nurses of shift openings. These professionals are matched based on required credentials, and the platforms allow for a convenient and comprehensive review of credentials, competencies, and skills by hospital administrators before they approve the shift at a pre-set rate. When combined with the use of a scheduling tool, these mobile applications can help reduce the time allocated to addressing staffing issues. Healthcare organizations looking to further engage the modern workforce will need to consider modern-day communication tools and new lifestyle expectations.

Several key characteristics are important when selecting a contingent staffing platform as a partner:

· The platform has sophisticated algorithms to notify particular groups (internal pool vs. external marketplace) and create a firewall to protect the facility’s own pool. It can escalate shift notifications to optimize fill rates and minimize cost. And it offers the option to create micro-shifts (4 to 6 hours) to help with census surge.

· The platform employs a user-friendly, transparent, and complete view of up-to-date credentials and competencies. It has the ability to interview candidates by phone or video, delegate shift approval and supervision, track candidates, review ratings and reliability metrics, and create mobile timestamps upon start and completion of shift.

· A successful platform has the option to optimize orientation costs via a combination of on-site and e-orientation, upload mandatory competency training modules, directly connect with candidates, and proactively enable shift readiness. The solution should include malpractice coverage, automated payment options, and assistance with meeting regulatory requirements.

· Cloud-based technology eliminates capital requirements and offers convenient access from any smartphone, with anytime, anywhere access.

· An effective platform provides risk-free, commission-based options with clear ROI and a pay-as-you-go model.

Through automation of staffing workflows, incorporation of regulatory and compliance requirements, and utilizing an on-demand solution, we are transforming the contingent healthcare staffing model.

Modern healthcare professionals seek more flexibility, efficient communication, and greater rewards. The use of tech-based staffing solutions will improve loyalty, retention, and engagement. The Provider Pool platform will soon be a competitive advantage of healthcare organizations. When integrated with workforce management tools, innovative on-demand staffing platforms offer a cost- effective, long-term solution to help reduce overall labor costs associated with patient care and can provide more flexible resources to fill open shifts.

For an initial consultation, please contact us at: info@providerpool.org

For more information, view our website at: www.providerpool.org

Janna Westbrook, CEO Provider Pool

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