It’s no secret that the healthcare industry is rapidly changing alongside emerging technologies, heightened cost pressures and growing patient influence. And despite disruption from COVID-19, the trend toward healthcare industry consolidation is showing little sign of slowing down.
According to an August 2020 Bank of America/HealthLeaders survey, 69 percent of healthcare leaders said their organizations were exploring or completing merger and acquisition (M&A) activity within the next 12-18 months. When survey respondents who were exploring potential deals were asked about their organizations’ future M&A activities, 91 percent expected it to increase or remain the same.
But as more hospitals, medical practices and other healthcare providers come together to operate as one, interoperability among the various IT systems, databases, reporting environments and processes poses an extraordinary challenge.
While providers have made strong investments in electronic health record (EHR) technology and other systems to build data-rich environments, many still lack the information essential to drive operational cohesion and efficiency. As such, healthcare providers are hard-pressed to simultaneously drive high-quality patient care and significant cost reduction.
What they need is the ability to access the right data analytics and business intelligence on one fully integrated and secure platform. This capability reduces unnecessary burden on staff, improves enterprise-wide communication and enables strategic decision-making.
Enter the ERP.
As many providers have transitioned non-clinical administrative staff and departments to remote work alongside COVID-19, the importance of digital readiness and connectivity has never been more important.
From this view, Enterprise Resource Planning (ERP) platforms are one of the most important technology solutions for health systems and providers to unify around. This business-critical system (or suite of integrated ERP tools or applications) can collect, store, manage and interpret data across an organization’s departments, including finance, supply chain, human resources and more.
At its core, the benefit of an integrated ERP solution across a health system is establishing a centralized place to manage operations, streamline communications and view analytics systemwide. Yet even as ERP solutions can align separate departments and improve workflows, historically, ERP platform deployment has been both time intensive and cost prohibitive.
Conventional, on-site ERP solutions can take years to deploy and include a range of costs to maintain, from purchasing hardware to hiring a team of consultants. As a result, many health systems continue to utilize outdated systems that struggle to adapt and align with the evolving healthcare landscape.
Thanks to recent technology advances, however, providers now have access to cloud-based alternatives that boast rapid, cost-effective implementations ─ and are agile and scalable to quickly and easily accommodate changes to organizational structure. And with a healthcare-specific ERP partner and platform, providers gain speed to value that cannot be realized with an industry-agnostic ERP.
When it comes to selecting an ERP system, it's important to remember that there's information. And then there's insight.
Organizations expect ERP tools to do the basics: manage the books, pay invoices, procure supplies, calculate depreciation, etc. However, today’s healthcare landscape demands business intelligence that’s more than powerful – it demands intelligence that’s empowering.
Modern and advanced ERP solutions provide a holistic, intuitive and intelligent experience that empowers providers to more proactively and precisely pinpoint both opportunities and areas for improvement.
Let’s take a closer look at four key benefits of a next-generation ERP platform:
- Standardization: ERP technologies that digitize and automate internal processes have been around for decades, but the most progressive ERP systems combine data and analytics to better support standardization goals. Next-generation ERPs have the capabilities to limit order options, automatically suggest or substitute options, and quantify the financial impact of non-compliance.
- Performance Improvement: Performance metrics are yet another type of actionable data that should be housed in a next-generation, cloud-based ERP platform. When provider teams can access benchmark data related to staffing, payer mix, procedure mix or referral patterns, leaders are able to make more informed decisions about budgeting and managing operations. ERP workflow capabilities can also provide significant opportunity to reduce clinician burnout and help relieve overworked staff in seemingly simple ways such as voice-recognition, data-entry automation and other routine administrative tasks
- Cost Reduction: Next-generation ERP solutions help health systems improve efficiencies and simultaneously reduce costs by standardizing processes, centralizing services and eliminating waste.
- Improved Patient Care: Providers are increasingly investing in next-generation ERPs to improve the accessibility and quality of patient care. With a strong ERP system in place that integrates with EHR systems, providers can more easily access patient medical records and details can be stored and transferred among departments and facilities ─ whether a trip to the physician's office, the emergency department or the x-ray lab. This helps clinicians to make the right diagnoses, provide the best treatment and help speed up reimbursement, because all the necessary information is readily available.
They allow staff to spot new items, pinpoint outlier clinicians, benchmark performance compared to peers, forecast volume and streamline the entire purchasing process ─ and all in real time. The value to organizations includes contract optimization, improved compliance, appropriate utilization and much more.
The end goal is to pinpoint gaps and problem areas, so health system leaders have the time, knowledge and resources to turn things around ─ enabling the insights to drive meaningful, enterprise-wide performance improvement.
An ERP solution helps the hospitals’ financial process by keeping track of the patients’ payments, as well as the operating costs for supplies and other relevant services. In addition, implementing an ERP helps reduce costly administrative and inventory errors, as well as saves employees time by handling distribution and purchasing responsibilities.
The most effective, modern healthcare leaders don't just analyze their data ─ they also understand it.
Whether the aim is cost reduction, patient outcome improvement or a head start on the value-based care movement, a next-generation ERP solution serves as a provider’s “central nervous system” ─ collecting information and data that can be interpreted, used, shared and managed consistently across the enterprise. With data fueling the future of healthcare, providers need an advanced solution capable of meeting business objectives and keeping up with their evolving requirements.
Interested in learning more about Premier’s award-winning ERP solution? View our ERP Buying Guide or learn more about how our data and technology are enabling better operational efficiencies.