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April 01, 2019 in HR, Payroll, Recruitment

5 Challenges Facing Human Resources Management in Healthcare

A number of challenges are stifling employee engagement and growth in the healthcare industry. Some of these issues stem from the ongoing battles being fought in the courts regarding healthcare legislation. Some are caused by the desire—and competitive need—to improve the level of healthcare for patients.

All this causes a need for additional human resources management, while budgets are being scrutinized more closely. Here are the top 5 challenges for human resources management in healthcare, along with how to overcome them.

Human Resource Management in Healthcare Challenge #1: High Turnover

Healthcare has one of the highest turnover rates of any industry, second only to hospitality.

A study by Compdata Surveys of 11,000 healthcare employers with more than 11 million employees found the average turnover in healthcare jobs in 2017 was 20.6 percent, up from 15.6 percent in 2010. A second study from NSI Nursing Solutions estimated turnover at 18.2 percent in 2018.

What’s clear is that the issue is getting worse every year, with a direct impact on patients. Non-clinical and non-physician roles also see a great deal of change.

The rate of turnover can be attributed to multiple factors. On average, young physicians are leaving their healthcare jobs twice as often as older doctors. Burnout is at play here; workload and job demands can be significant and burdensome. A combination of long shifts, tough cases, and demanding patients all make healthcare a tough road to follow. Since the ability to handle high-stress, is key, thousands are eventually seeking lower-stress jobs.

The scheduling and hours alone for a job in the healthcare profession can be grueling and detrimental to an optimal work-life balance. Because turnover is high, other staff must fill in any gaps, often on very short notice. Finally, compensation and pay are sometimes found wanting.

The cost of turnover adds up significantly, with the National Taskforce for Humanity in Healthcare estimating a $17 billion annual cost for physician turnover in the United States. The NSI Nursing Solutions Survey estimates a hospital can lose between $4.4 million and $7 million dollars due to normal RN turnover alone.

To solve this problem, healthcare companies are turning to companies such as Excelforce to assist with quality talent recruitment services so that the staff brought on board can move quickly through vetting, application, and onboarding.

In addition, we offer tools that are designed to improve employee engagement and the overall employee experience. Putting the right people into the right jobs plus leveraging the right technology are the first steps in retaining a happy, satisfied workforce.

Human Resource Management in Healthcare Challenge #2: ACA Compliance

The Affordable Care Act, put into place by President Obama’s administration, is a confusing regulatory environment for long-term nursing facilities, assisted living facilities, home care networks, doctor’s offices, health centers, hospitals, outpatient facilities, and more.

Of course, you know that the ACA’s employer mandate has significant penalties for non-compliance. Small employers are exempt from certain ACA regulations, but they still spend an average of 13 hours or $1,274 a month just to keep up with ACA compliance.

For employers with more than 50 employees, also known as applicable large employers or ALEs, there are specific mandates. They must:

  • Offer affordable, minimum essential health care coverage to full-time employees.
  • Use 1094-C and 1095-C to report to the IRS information about the health care coverage offered or not offered to full-time employees.
  • Furnish 1095-C to full-time employees providing the same information reported to the IRS.

For businesses with around 50 employees, it can be tough to determine whether they are officially an ALE, what that means, and what they must provide. Figuring out the answers to these questions often requires money.

On the other hand, if a business owner disregards ACA mandates, there are multiple penalties for non-compliance. These penalties increased in 2018.

Our clients use the Excelforce benefits solution to help ensure ongoing ACA compliance, with the assistance of our insurance experts. Questions from our clients are addressed immediately and our customer service team is ready to make quick adjustments as your business grows and as legislation changes.

Human Resource Management in Healthcare

Challenge #3: Medical Staffing

Hiring the best-trained, more prepared doctors and nurses will lead to better patient treatment and results. But what if those high-quality candidates cannot be found?

A physician shortage is growing every year. In fact, the United States could see a shortage of up to 120,000 physicians by 2030.

The issue extends far beyond physicians, however. A Prudential-sponsored survey found significant signs of an impending overall talent shortage.

  • More than 90 percent of respondents said that within the next three years they will see a deficiency in the number of well-trained specialists, doctors, nurses, and other clinicians.
  • More than 40 percent of healthcare executives participating in a 2018 Healthcare Financial Management Association (HFMA) and Navigant survey said that the nursing shortage is getting worse year over year.
  • 48 percent of respondents to the Economist Intelligence Unit survey said specialist nurses are the most difficult employees to find.
  • 61 percent of respondents to a 2018 MGMA poll said they faced a lack of qualified applicants for non-clinical positions in the past year.

Meanwhile, the US population is estimated to grow 11 percent by 2030 overall. But one of the fastest-growing segments is baby boomers, who are in need of more care. The number of people ages 65 and up will grow by 50 percent, and the population of people 75 and up will increase by 69 percent.

Evaluating medical and staffing needs and planning accordingly is done much more easily using the Excelforce tool, used by numerous healthcare companies to track and assess payroll data.

Human Resource Management in Healthcare

Challenge #4: Labor and Payroll Costs

Healthcare pay and spending are significantly higher here in the United States than in other countries. The average salary for a physician in the U.S. is 160k to 260k. For specialists, it is $346k. For nurses, it is $77,460.

New call-to-actionFor doctors, that U.S. average is almost double the average of the 10 other countries surveyed. On the spending side, the U.S. spent 17.8 percent of its Gross Domestic Product (GDP) on healthcare, while other nations ranged from 9.6 percent (Australia) and 12.4 percent (Switzerland).

Labor and management costs can be compounded by outdated tech. If a hospital or nursing home is using an older healthcare workforce management system or disregarding the advantages of up-to-date analytics tools, costs can rise unnecessarily.

Chip Newton, Healthcare Sector Lead of LaborWise at Deloitte Consulting, LLP, noted, “A lot of times, those (management tools) were implemented 10 to 20 years ago at health systems.” A lot has changed in that time.

An updated time and labor tool, such as our time and labor management system, can streamline operations, make it easier to analyze where costs are out of line, and make necessary changes.

A top payroll concern for healthcare providers is the Payroll-Based Journal (PBJ), mandated by Section 6106 by the ACA. The mandate requires that specific Long-Term Care (LTC) facilities electronically send direct staffing and census information to the Centers for Medicaid & Medicare Services (CMS).

Required information includes:

  • The number of work hours paid to certain staff members.
  • The report must be submitted quarterly to the CMS.

A payroll solution built to facilitate healthcare providers increases the accuracy, timeliness, and ultimately the cost of PBJ reporting.   

Human Resource Management in Healthcare

Challenge #5: Training and Certification

Typically time is set aside by healthcare organizations for physician training and certification requirements, along with the safety training on equipment and operations which apply to all staff. These needs are better supported with a clear and comprehensive tracking system, ideally with built-in alerts for important deadlines. Keeping track of training and certification compliance also protects an employer legally.

A need for improved training was only one of the elements lacking for employees. There is also a need for better organizational policies to support training needs. A facility with management lacking clarity on the importance of training and certification can quickly become outdated and unsafe, putting patients in peril. 

Whether your biggest concern is reducing turnover, complying with the Affordable Care Act, identifying top talent, optimizing productivity, or creating a more efficient training program, the right partner can help.

“It is beneficial to partner with a vendor committed to continuously enhancing its offerings. Health care is in a constant state of flux and having stagnant solutions won’t realize long-term goals,” according to David Osborn, senior vice president of strategic accounts and advisory services at HealthTrust.

Excelforce can assist with each and every one of the top five challenges facing human resources management in healthcare. We encourage you to read more about our industry-specific human capital management solutions. You can also improve your ACA health care terminology glossary here.

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