4 Key Takeaways from A New Reality—The Flat Talent Market

Meaningful Use was introduced to providers in 2009 with the goal of providing transparency of information for both patient care and the reporting of quality measures to improve overall quality of care. Final rules were published in the Federal Register on July 28, 2010 and became effective on September 26 that same year. This effort led providers on a journey of ensuring their electronic health records (EHRs) met criteria. Eight years have now passed since its enactment and its impact has taken on new forms.

Although the concept of Meaningful Use rested on the ‘5 pillars’ of health outcomes policy priorities, namely 1) improving quality, safety, efficiency, and reducing health disparities, 2) patient engagement, 3) improvements in care coordination, 4) improving population health, and 5) protection for personal health information, the program forever changed the talent market for various revenue cycle functions. In his book, The World is Flat, Thomas L. Friedman argues that it is the evolution of the Internet that has turned certain skills into commodities and created the outsourced world we live in today. The fact that hundreds of publicly traded companies seek lower costs through outsourcing is undisputable. The key contributor, the World Wide Web, has enabled access to a global talent pool with the Internet serving as its vehicle for the delivery of services previously restricted by access and geography.

The talent market in healthcare becomes a level playing field

Healthcare entities today face this same certainty, although many are not aware or choose not to adapt. The choice of offshore versus domestic labor is known and debated. What is lost is the fact that the domestic labor market has changed, and the consequences and rewards are equally as important. EHR technology has enabled numerous functions involved in the processing of a claim to be performed remotely. As a result, hospitals have opened to the possibility of recruiting the best and brightest nationally. Location is no longer the driving factor in the cost of talent for many positions including: coding, CDI, billing, AR follow up, insurance verification, and more. In fact, traditional on-site leadership positions are now performed from home with equal efficiency.

Hospitals that realize this and adapt accordingly are lowering labor costs within key positions that determine their bottom line. Organizations that fail to realize this are relying on salary guides compiled by local staffing companies using cost of living as a driving factor in position salaries. Ultimately, those policies on salary are limiting their ability to recruit and over time I feel will lead to an increased reliance on outsourced labor and the acceptance of lower quality performance based on the perceived availability of resources.

Here are four key takeaways from our flat talent market:

  1. Hospitals in high cost of living areas are providing attractive salaries to individuals living in states with a lower cost of living
  2. Hospitals in lower cost of living areas are unable to recruit the best talent on a national scale because of lagging salaries for key positions
  3. Hospitals in high cost of living areas without flexible hiring models continue to pay a premium for less than optimal talent
  4. Hospitals in low cost of living areas that have flexible hiring policies fill positions quicker and enjoy less turnover
Hospital leadership needs to embrace this new reality of a flat talent market

Harmony Healthcare is a human capital management company with a vested interest in understanding these dynamics. This impacts our recruitment strategies, our advice to clients, and ultimately our delivery of high acuity experts throughout the revenue cycle. Key leadership positions that must be performed on-site still abide by the same rules that existed prior to the talent market becoming a level playing field. The ultimate cost of securing resources is dependent on the available talent within a daily commute. If you’re located in a rural area and need a CFO, my guess is the available qualified resources can be counted on one hand. That same facility that needs talented CDI professionals is not bound by the same limitations.

Meaningful Use cost providers billions of dollars and the result of that investment may or may not have met the intended goals. That separate discussion does not impact today’s fact—today’s search boundaries for available talent for numerous bottom-line defining key roles no longer need a protractor. Those “borders” no longer exist and the potential benefits of that truth are only limited by a lack of imagination from hospital leaders. Hospital leaders need to be aware and embrace this new reality.

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