Empowering Hospital Workforces Amid Mergers and Consolidations

Throughout 2023, 65 hospital and health system deals were announced, which is an increase from the 53 announced in 2022, according to recent data from Kaufman Hall. Coming out of the pandemic, health systems have been increasingly concerned about their long-term viability in remaining independent as profit margins tightened due to spikes in labor and supply costs. While they continue to manage lingering financial pressures, it’s likely we will see mergers as the norm throughout 2024 while these systems reposition themselves for the future.

At the same time, care delivery is evolving and becoming more complex as organizations embrace consolidation and add services like telehealth and specialists to “scale up” patient volumes across multiple health systems. While there have been successful health system mergers, it is more challenging in this market as many organizations are left to struggle with increased costs, reduced quality of care, and provider burnout.

Top considerations for health system leaders amid mergers

If not supported properly when trying to meet the demands of combined workforces, a tangled web of disconnected systems makes it nearly impossible to efficiently manage and deploy providers, nurses, and staff – resulting in decreased provider wellbeing, increased costs, and lower quality of care.

That’s why, as these newly merged health systems work towards integration, leaders must not lose sight of the role that a single source for workforce management data plays in organizing providers and staff alike – who, at the end of the day, are the powerhouses behind providing quality patient care. Workforce management provides the tools that you need to activate, deploy and manage your workforce, and gives visibility into provider, nurse, staff, and on-call scheduling, compensation management, credentialing, and more.

Whether incorporating affiliate practices, adding new service lines, or opening a new Center of Excellence, success requires focus on workforce operations and logistics necessary to orchestrate providers and staff during these changes. As a result, optimizing these operations will help to improve financial margins and staff and provider wellbeing.

Control labor costs with technology

In 2023, while hospital finances and margins were better than 2022, there were still financial challenges due to factors including staffing shortages and high labor costs. Keeping in mind past mergers have resulted in legal complications due to decreased quality of care at the same time costs rose, it’s critical that health systems have technology in place that can support combining organizations without having to rely on external labor, which just exacerbates the financial struggles hospitals face during mergers.

Having a single solution for workforce management will help ensure a smooth transition, and centralizing and integrating workforces with a single solution allows organizations to control labor costs with added visibility into workforce utilization and overtime management from a single reference point. This enables identification for gaps that need to be filled, meaning workforces run efficiently and effectively. And beyond that, when resources are optimized, external labor reliance will decrease and only be leveraged when necessary.

Improve margins with engaged autonomous staff  

According to a 2023 nurse.org survey, 81% of nurses said they’ve felt burnt out in the past year, with 79% reporting inadequately staffed units, and 71% reporting improving staffing ratios would have the greatest impact on the nursing shortage.

Workforce management technology that provides trends, staffing, and utilization across health systems before they merge helps to identify future staffing misalignments and proactively make changes, ensuring appropriate staffing ratios. Not only does this help control labor costs and improve financial margins for health systems, but it can help improve engagement.

Another factor to consider is the improved autonomy for nurses and providers. When staff can easily see when and where they’re working, update their preferences, and reduce the time and hands-on work required by managers to create and update schedules, they feel a sense of autonomy and overall satisfaction. Self-scheduling is a proven strategy to empower nurses because it gives them the freedom to control their schedules based on individual preferences, and efficiently handle float requests.

Merger success for years ahead

Strategic organization of workforce management data amidst health system mergers is one of the most important considerations for successful integration as you blend providers and nurses across two organizations. Integrating these capabilities orchestrates the human beings responsible for providing the care to patients between these organizations. In addition to providing support for staff amid a merger, this technology also helps to improve health system bottom lines.

As we dive deeper into 2024 with analysts expecting more mergers and acquisitions, it’s important that key health system leaders consider the benefits of integrating workforces and technology that can provide an effective, single solution for provider, nurse, staff, and on-call scheduling, and more. As part of merger activity, health systems need to consolidate disparate provider systems and processes that support the actual care team and empower them, reduce administrative burden, and support work / life balance. By implementing workforce management technology to support the people who take care of the patients, health systems can ensure that merger and acquisition activity is a success.

Photo credit: Mironov Konstantin, Getty Images

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