Hospital Budgeting: 3 Main Areas of Cost Challenges

Hospital Budgeting for Finance Executives - Here are 3 main areas of cost challenges for hospitals:

1. Physician preference items:

These are the implants and tools that different physicians prefer or are trained on when doing surgery. It is challenging for hospital budgeting.

Different tools might bring the same benefit but have very different costs to the hospital.

2. Purchase services:

These are very diverse and sit throughout the hospital, e.g., laboratory services, dietary services, etc.

They’re about 50% of a hospital's non-labor costs.

3. Outsourced physician service agreements:

They include outsourced ER services, outsourced anesthesia services, etc.

These agreements are very complex and can significantly drive up costs.

We analyze these 3 complex areas and map them to other data to find cost-saving opportunities for hospitals.

P.S. In the coming videos, I’ll talk in detail about where you can find opportunities in these areas.

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