Health care leaders are setting ambitious cost-cutting goals to fund new resources and care delivery investments. To achieve these goals sooner rather than later, they'll need to target areas of expenditure with the biggest near-term savings potential—which aren't those you might expect.
This study equips nurse leaders to act on the four ripest cost-saving opportunities: reducing premium labor, modernizing outdated care protocols, eliminating supply waste, and restructuring unfavorable contract terms.
Not a member of the Nursing Executive Center? Download a study excerpt here so you can start looking for and tapping into sustainable savings opportunities.
The problem with 'budget-driven' cost cutting
Almost 80% of hospital executives say they're trying to reduce operating costs by at least 5% over the next three years. Many will decide where and how much to cut based on current budget allocation—an approach that puts labor (particularly nursing labor) front-and-center. But this strategy overlooks smaller budget categories where most hospitals will find their best opportunities for near-term savings.
An 'opportunity-driven' approach changes cost-savings targets
Rather than focusing on big-budget items, hospital executives should target untapped opportunities to reduce spending and evaluate each based on savings potential and applicability.
As the charts below illustrate, this opportunity-driven approach fundamentally alters the cost-cutting conversation and shifts the focus to reducing premium labor, modernizing outdated care protocols, eliminating supply waste, and correcting unfavorable contract terms.
Hospital Operating Costs vs. Largest Cost-Reduction Opportunities
The 11 strategies detailed in this study will help nurse leaders generate significant savings in each of these areas:
- Premium labor
- Outdated care protocols
- Supply waste
- Unfavorable contract terms
Members can log in to access the study. Not a member? Check out the infographic we've created outlining our 11 strategies for finding near-term savings.
Next, Check Out
Are you looking for near-term savings in the wrong places?