This article was written by Lisa Miller.
While COVID-19 continues to pose a global threat, healthcare organizations must begin to plan their recovery from this crisis now.
A return to baseline will prove both costly and time consuming, but an effective, sustainable recovery doesn’t mean health systems settling for the status quo that existed prior to the pandemic. A sustainable COVID-19 response, with a comprehensive hospital recovery strategy is essential.
Hospitals now have an opportunity to explore and implement strategies to improve their existing systems and emerge from this crisis in a stronger position than they entered it.
The four strategies below can provide a foundation for that response:
For hospital leaders, grappling with the provision of specialist patient care for COVID-19 patients, while protecting themselves and their frontline staff, identifying the most effective resources for your organization is a challenge.
Securing the funding your hospital is entitled to will ensure resources are in place as you implement effective response strategies during this period of rebuilding. The first step is to access funding.
The funding available through the CARES Act will be provided through the Public Health and Social Services Emergency Fund (PHE Fund) and reimburse providers for ‘’healthcare related expenses or lost revenues that are attributable to coronavirus.”
These are specifically related to areas including:
- Hospital revenue reduction, as non-urgent procedures are postponed or canceled.
- The cost of critical items which are in short supply, such as personal protective equipment (PPE).
- The cost of hiring additional staff to care for higher patient numbers.
- Reimbursement of costs relating to care for uninsured patients at Medicare rates.
At a FEMA briefing I attended, it was noted that this is the first time a FEMA recovery has been made available for a pandemic; there is no precedent.
I encourage all healthcare leaders to access the most appropriate resources for their hospital. I also recognize that in rising to the challenges presented by the pandemic in terms of allocating hospital resources and delivering quality patient care, vital resources may be overlooked.
Our team at VIE Healthcare can help you to identify the most relevant for your organization.
Accelerate and maximize your funding solution
Once you understand what reimbursements are allowable for your organization, the process of extracting and documenting your costs begins to submit your claim for funding. The minimum information must include:
- Capturing all eligible costs to date incurred by your hospital.
- Documenting all of these costs in detail.
- Establishing a system to understand how to procure costs going forward.
- Implement a monitoring system to manage and audit your costs on a monthly basis.
While this will help to create a firm foundation of cost control for a future pandemic or crisis, it is also a best practice that will enable sustainable margin improvement, especially in key areas such as purchased services.
To assist your application for funding, a number of worksheets are available, for example:
- Public Assistance Reasonable Cost Evaluation. This also covers the definition of “reasonable costs.” Preparation of information relating to this area should be completed by a cost expert on your team or a third party provider with the necessary expertise.
- Additional worksheets cover personnel costs, equipment costs, expendable supplies and incident tracking.
- FEMA also recommends a combined cost worksheet, an intuitive document that enables your hospital to record the patients you are treating with COVID-19, including details of the PPEs utilized per patient every day.
Supply chain strategy
Hospital supply chain strategies and operations have been under pressure for some time are severely challenged as a result of the pandemic. Research suggests that the national median hospital operating margin has fallen to -8%. National median hospital operating margins have fallen to -8% as a result of the pandemic. Click To Tweet
Smaller and rural hospitals, which typically operate on narrow or negative margins, are under acute pressure.
Clearly, this is not sustainable for any long period of time. Hospitals must establish and maintain healthy balance sheets in order to continue serving the health of their communities. Poor finances very often lead to hospital closures, leaving those communities with no local source of patient care.
The supply chain has increasingly become a focal point for many hospitals seeking to reduce costs. The tendency to purchase supplies from the lowest bidder, which is often the international market, has resulted in a supply chain that lacks the agility to successfully navigate a crisis like the COVID-19 pandemic.
Effective cost management of your supply chain is critical. Now is the time for all health systems to begin to analyze and retrospectively assess what stock has been utilized during the pandemic so those costs can be captured and reimbursed.
Invoice details, historical data and quotes from your vendors will all be essential in order to justify costs in your supply chain.
Again, effective practices implemented now, can provide the foundation for successful supply chain management in the long term.
Cost savings partner
For most hospitals, the process of gathering the documentation for FEMA to claim the funds they are entitled to is a time and resource consuming process.
We recommend the following:
- Ask questions of FEMA in your application for funding to ensure your application includes all reimbursements your hospital is eligible for.
- Follow procurement protocols and meet your deadlines for submission.
- Ensure you are keeping clear, complete and accurate records. Don’t jeopardize your reimbursement because vital information is missing.
A cost savings partner can help you to gain access to funding more rapidly and effectively and ensure that all documentation submitted is both relevant and accurate, down to the line item details of your invoices. Send us a message to learn more.