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Outsourcing Human Resources for Healthcare Institutions

From recruitment process outsourcing (RPO) to benefits processing, third-party service providers offer an efficient way for resource-strapped clinics and hospitals to handle HR functions.

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Healthcare administration is notoriously inefficient, mired in patient data and red tape. As the cost of care and rising patient demand strain resources to the breaking point, medical institutions are seeking ways to streamline operations. Human resources outsourcing offers an important resource in this battle.

For an industry so dependent on data management and bureaucratic red tape (think insurance billing), its surprising that the medical establishment has been so slow to take up outsourcing. Medical institutions represent fewer than five percent of outsourced HR clients. According to industry analysts, however, its only a matter of time before staff shortages drive institutions to seek outside help. andquot;Its axiomatic that outsourcing needs to be part of the equation hospitals and other institutions consider,andquot; says Dr. Jeff Bauer, healthcare andquot;futuristandquot; at business services provider ACS.

Opportunities for Outsourcing
Outsourcing has been slow to gain traction in the medical sector in part because of the tactile nature of the profession--for the most part, medical care requires local delivery. Back office functions, however, are readily outsourceable. With respect to patient administration, outsourcing services include:

Insurance claim processing

Admissions and discharges

Patient records management

Third-party providers also offer the following workforce administration services:

Payroll administration

Benefits enrollment and administration

Recruitment

Absence management

Tracking flexible-schedule and temporary workers

HR Recruitment Process Outsourcing
Recruitment is among the highest-value outsourcing services for the healthcare market. After all, a shortage of qualified workers is one of the most serious problems facing the medical industry. Third-party recruitment, or Recruitment Process Outsourcing (RPO), claims Jeff Bauer, can help reduce costs, improve candidate quality, speed up the time it takes to fill vacancies, and even improve retention. RPO providers have the experience and contacts to conduct an efficient and effective talent search, freeing up internal HR staff to conduct the higher-level vetting of candidates.

Outsourcing Solutions for Data Management
The Holy Grail for administrative efficiency is an integrated data environment. The goal of a universal patient database is to lower costs and improve the quality and reliability of care. But even strictly HR-related functions could realize significant gains from effective data management. HR director Renee Tehi points out that many healthcare facilities maintain multiple locations and need to track employee attendance across all of them. A standardized tracking system streamlines payroll and attendance accounting and ensures compliance with leave, disability, and other administrative details.

In a time of limited resources, human resource outsourcing represents an ace in the hole for the healthcare industry. Terrence McCrossan of ADP, a professional services provider, defines the challenge ahead for healthcare administrators: The single biggest issue any healthcare administrator will face is how to transform and innovate while maintaining or even reducing the total operating cost to the organization. Human resources outsourcing offers a viable means of increasing efficiency while cutting costs.

Sources
HRO Association
Future Healthcare