Sustainability in Healthcare is More Important Than Ever

Healthcare Finance News reported that according to a recent survey, “more than half of U.S. hospitals now make sustainability a factor in purchasing decisions.” Even more importantly, the survey found that over 80 percent of hospitals in the U.S. expect to engage in sustainability purchasing within two years.

And that’s not surprising given that a different study from The Commonwealth Fund (also reported in Healthcare Finance News), found that hospital sustainability efforts could save the healthcare industry up to $5.4 billion over five years and $15 billion over 10 years.

That’s a lot of dollars.

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Healthcare Providers Are Feeling the Squeeze: Cost-cutting alone just won’t cut it

“Healthcare providers as a group continue to operate with slim and shrinking margins,” according to recent analysis from Modern Healthcare. Sadly, that’s not a surprise to most of us. The study—which included acute-care, post-acute care, rehabilitation and specialty hospital groups as well as stand-alone hospitals— found that the average operating margin in 2013 was 3.1%, which was down from 3.6% in 2012. Over 61% of organizations saw their operating margins erode over the previous year.

While we’ve seen this coming, the news is sobering. And analysts are skeptical that the worst is over. According to Modern Healthcare, all three credit-rating agencies hold negative outlooks for the not-for-profit healthcare sector.

Sustainability for Successful Healthcare Management

Traditionally, when we hear the word “sustainability,” it conjures up ideas of the health of the environment and the idea of “going green.” And that is clearly a very large part of the sustainability movement, but the concept of sustainability extends further.

MedSpeed is a member of Practice Greenhealth, a not-for profit organization whose mission is to be “the source for environmental solutions for the healthcare sector that lends support to create better, safer, greener workplaces and communities.” Earlier this year, Laura Wenger, Executive Director of Practice Greenhealth wrote, “Sustainability isn’t just about environmental stewardship. As the [health] sector faces increased financial pressures, more hospitals and health care facilities should prioritize sustainability as a way to strategically manage rising costs.”

CFOs and the Supply Chain: A winning strategy

Over the past couple of years, in this space you’ve seen the discussion about supply chain as a strategic asset for healthcare organizations, and how important it is that those in the C-suite understand and view it as such. A recent Dow Jones/Deloitte Risk & Compliance Journal report titled “How CFOs Are Reshaping Supply Chains” makes this case very compellingly.

The report notes that while both chief risk officers (CROs) and chief financial officers (CFOs) have long been involved with supply chain oversight, finance chiefs—with their eyes on cost controls, risk management and the levers of working capital—are increasingly involving themselves.

Practicing Sustainability, Not Just Preaching It

Back in the winter, I wrote about the benefits of sustainability in healthcare. The study I cited, sponsored by the Healthier Hospitals Initiative (HHI) showed that sustainability initiatives could save the healthcare industry billions over several years. At that time I noted that we were going to look for more ways to continue our own sustainability efforts.

I’m very pleased to announce that MedSpeed has joined Practice Green Health, an organization that supports “environmental solutions for the healthcare sector and lends support to create better, safer, greener workplaces and communities.” This nonprofit membership organization was founded on the principles of positive environmental stewardship to support best practices by organizations in the healthcare community.

Sustainability Can Really Pay Off

The core mandates of the Affordable Care Act are to increase access to healthcare, while decreasing costs and limiting waste. Every U.S. healthcare organization today is looking for ways to align with healthcare reform in order to meet these goals. While companies are instituting a number of different initiatives, there is one that we believe strongly in that has recently been getting more and more interest from the industry – sustainability.

According to a recent study from the Commonwealth Fund, sustainability initiatives could save the healthcare industry up to $5.4 billion over five years, and $15 billion over 10 years. Those are some really big numbers.

5 Daunting Issues Keeping Healthcare CEOs Up at Night: Executives focus on re-imagining healthcare delivery

Those of us in the industry are well aware of the enormous challenges facing U.S. healthcare, but probably no one feels these impending changes more than healthcare CEOs. Recently, Huron Healthcare conducted interviews with hospital CEOs to determine the top five issues keeping them up at night. As reported in Healthcare Finance News last month, the burning issues are:

1. Change management: With the amount of market-driven and reform-driven change affecting healthcare providers, CEOs are troubled by how they can prioritize

Better Efficiency Can Lead to Better Care and a Better Bottom Line

An industry survey conducted by HealthLeaders, entitled “Better Care and the Bottom Line,” recently caught my eye. As part of the survey, HealthLeaders asked 289 healthcare executives what they believe are the major drivers of waste in healthcare today and what they believe can help fix the problem. The respondents listed the following as the key contributors to waste:

Operational inefficiency
Overutilization of services
Lack of system integration