Continuing on with the second part of my column highlighting an open forum seminar with approximately 70 to 90 facility engineers from the hospital industry and the “state-of-the-state” of the healthcare business, the following question was asked of the attendees:

“Are outsource O&M support service firms more or less cost-effective than in-house operations?” Their responses were:

  • Outsource firms can provide diversified specialists who may serve several accounts but hospitals have not banded together to establish the same concept. This is very unfortunate for the hospitals that have merged because it is a “lost opportunity.”
  • Outsource firms are better prepared to win an argument based on their ability to pick and choose the issues. In-house support service job descriptions are very broad and undefined.
  • Outsource firms are better organized because they function on a “for-profit” philosophy.
  • Outsource firms present themselves as a “leaner” organization than the traditional hospital support services groups because the scope of work is far more defined. Other services can be provided at additional cost.
  • Outsource firms are in a better positioned to hire, terminate, and reward their employees.
  • Outsource firms can better manage scope because it is clearly defined. Endusers within the hospital may not like this limited scope of services but they recognize that the outsource firm has a specific contract. In-house support groups don’t have this same luxury to limit their services.
  • There is a dual standard for productivity with in-house support services running at 50% productivity. The opinion stated was based on in-house facility manager’s limits on hiring, terminating, and rewarding their staff.
  • Outsource firms are “for-profit” organizations and in-house support services are not recognized as “for-profit” but instead, a cost of doing business.
  • Outsource firms have the ability to promote and/or transfer personnel. These individuals can focus on a career path that isn’t necessarily offered to in-house employees.
  • Once an outsourcing firm is in a hospital, the staff has job security fears that they didn’t necessarily have when they were part of the hospital organization. In addition, the opinion was expressed that work performance drops off once the work has been outsourced.
  • Outsource firms are far better at documenting results/performance.

    All the opinions expressed above came from in-house facility engineers who also recognize that their management has tolerated this double standard, much to their dismay.

    It was also noted that outsource firms are better prepared to meet the hospital executive’s interpretation of O&M support services primary function because:

    • Tech support is available and yet is not necessarily a day-to-day cost to the hospital.
    • Peak workloads can be met by drawing upon other company resources for short periods of time.
    • Purchase power appeared to be more prevalent with the outside firms, although hospitals that have merged should have the same potential to “buy-better.”

    When the question was asked, “Do outsource firms have a better database to run today’s complex O&M support services?”, The answer was a unanimous “Yes.” Outsource firms have multiple sites to draw upon for information and are more conscientious at collecting this data. Here again, hospitals that have partnered or merged should have the same potential to produce this performance database.

    In closing the forum, I asked the audience how many of their hospitals had changed and/or added a eye-catching logo to their facility and on their letterhead. More than 50% of the attendees’ facilities have new logos and letterheads. The reason hospitals are projecting a “new image” is because they are competing to survive in the healthcare industry. Hospitals either have in-house marketing or they hire a marketing firm to get the message out. At the same time, outsource firms are also very aggressive at marketing their services. The only ones who are not consistently out marketing themselves are the in-house, facility support service groups.

    What’s that tell you?