Most health systems are experiencing financial challenges and leaders are concerned about funding clinician wellbeing work when finances are stretched thin.
The commonly discussed approaches to decreasing burnout – reducing workload and providing wellness support services – risk reducing revenue and increasing expenses, reducing margins. No health system has the financial capacity to engage in activity that will reduce margins.
Here are three approaches to improve the workplace and reduce burnout that can make financial sense.
Focus Redesign Work First on High Margin Services
It’s best to start with a pilot project for proof-of-concept. By starting in a high-margin service, such as imaging or lab, there is potential to reduce the drivers of burnout in the clinical workplace, while increasing throughput 25-50% and realizing greater revenue, without adding expenses or increasing staff work hours or intensity of work. The improved access and turnaround times enhance the clinician and patient experience across the system.
Factor in the Savings of Reduced Physician Turnover
Depending on specialty, it costs $500,000 to $1,500,000 to replace a physician factoring in the lost productivity of the departing clinician, plus recruiting costs and ramp up in productivity for the new clinician.
The approximate cost for your organization can be calculated using the AMA StepsForward Organizational Cost of Physician Burnout calculator. Dividing this number by the organization’s investment in wellbeing support, it’s easy to calculate the ROI for wellbeing work. Please let me know if you have questions about this how to use this tool.
Balance Sheet Approach
Clinician wellbeing work often requires a larger upfront investment, increasing expenses in the first year of the project and negatively impacting operating margins. Improved revenues or decreased expenses are realized in subsequent years far surpassing the initial start up cost.
Such financial fund flow methods are used for analyzing the impact of long term capital investment projects such as high-end diagnostic or therapeutic equipment, which are amortized over the life of the object. For capital equipment, this minimizes the impact of the front-end investment and acknowledges the long-term financial gain.
CFOs are comfortable using this approach with facilities and equipment. Ultimately, the investment in reducing work overload and engaging clinicians has the same impact.
While it’s unlikely one could amortize the cost of clinician wellbeing investments using traditional accounting approaches, it does raise the question of pursuing philanthropy funding for wellbeing work, similar to philanthropy support for long-term capital projects. There is increasing interest among donors in supporting clinician wellbeing. Grateful patients care about their doctors and are likely to contribute to a cause that can reduce their doctors' burnout.
If you have questions, don't hesitate to contact me.