Overcoming the Hidden Costs of Decentralized Educational Spending

Many health systems today struggle with the hidden costs of siloed operations and decentralized spending. Yet, breaking down silos in healthcare can lead to better decision-making, tighter budget oversight, and a reduction in unnecessary spending.

When spending is centralized, hospitals benefit from greater transparency through cross-functional collaboration, better departmental alignment, and improved budgetary controls.

One avenue that is often overlooked but can immediately improve a health system’s bottom line is centralizing and optimizing spend on purchased services like continuing education for staff. These costs are usually managed locally, with departments handling their own specialty vendor contracts and invoices, and individual employees handling many of their personal educational expenses. As a result, no one team or individual is accountable for all this spending, and purchases flow through procurement and accounting with limited oversight or coordination.

HPC International offers a solution, EducationManager, which centralizes the entire spend category for healthcare education and training expenditures, provides comprehensive tracking and reporting, and offers insights for informed decision-making. By centrally overseeing this area of purchasing, it gives HPC’s team visibility over all related spending. This, in turn, enables HPC’s team to eliminate duplication, reduce administrative burdens associated with approvals and payments, and negotiate volume discounts.

EducationManager has helped HPC’s healthcare partners simplify and centralize their education-related processes. Below are a few examples of how it’s made a difference:

From Individual Payments to Institutional Savings of Nearly 50%

One healthcare organization needed to pay for professional memberships and certification exams for almost seventy of its healthcare IT professionals through a national association. In the past, these transactions had been processed individually in separate renewals and payments, scattered on different renewal dates throughout the year, and allocated to separate budget cost centers across its many hospital locations.

With the EducationManager solution in place, however, HPC negotiated a discounted corporate group rate for all memberships and exam fees, achieving a combined 49.6% overall savings. Going forward, each of these annual memberships will be synced into the same renewal schedule, eliminating a lot of time and administrative work by consolidating all fees into a single invoice.  

Centralization of Institutional Memberships Cuts Costs

HPC uncovered that a health system had multiple institutional memberships for several of its different hospital sites related to neurology, pulmonology, otolaryngology, and sleep medicine. Through HPC’s research, it discovered that each acute location renewed and negotiated these separate memberships at different times of the year with no internal collaboration or central oversight.

Upon implementing EducationManager, HPC consolidated these separate institutional memberships into one corporate group and negotiated a 10% discount overall. HPC also aligned renewal dates, streamlining the approval, invoicing, and payment process to reduce administrative burden.

Centralized Oversight Saves 90K and Prevents Costly Redundancy

HPC assisted another healthcare system in reviewing its library subscription resources before renewal deadlines. Through the evaluation process and collaboration with multiple department heads and leaders, HPC uncovered that the organization’s pharmacy department had a duplicate subscription to the same drug resource already available as an institutional license through the medical library.

The result of not having HPC’s oversight until recently led this health system to waste nearly $500,000 on paying for this duplicate subscription for the past six years without anyone in the supply chain, accounting, or legal noticing. However, with HPC’s centralized oversight now in place, HPC immediately brought this duplication to light, saving the healthcare system about $90,000 per year moving forward.

Consolidated Book Purchasing Yields 12% Savings

HPC consolidated the ordering, negotiating, purchasing, invoicing, and shipping processes for a healthcare system’s fragmented departmental book orders. By becoming their single centralized source for all books and training products through the EducationManager solution, HPC simplified the procurement process, enhancing efficiency and reducing administrative burdens. At the same time, HPC leveraged its large volume of spend to secure lower pricing, resulting in 12.2% savings for the organization.

Enhanced Administrative Support and Efficiency

HPC’s EducationManager solution includes access to a customized online portal. This portal enables employees to submit education expenses, manage profiles, track requests, access free or institutional training resources they may be unaware of, and review company policies in one place. By handling the request, approval, and payment processes, HPC reduces paperwork and saves time for employees and the accounting department, allowing them to focus on higher-priority tasks.

Many top healthcare organizations, including industry leaders like Henry Ford Health and Franciscan Health, have already adopted this innovative approach to managing continuing education expenses. Partnering with a specialized provider like HPC International is considered a best practice for organizations struggling with decentralized processes and inconsistent spending policies. With deep expertise in healthcare education, HPC delivers the transparency, cost savings, aggregation, and administrative support healthcare systems need to manage this critical spend category more effectively.

As published by jhconline.com