Hospital outsourcing: A lasting trend?

To combat sequestration-induced Medicare cuts and healthcare reform, hospitals have increasingly reduced costs with outsourcing, according to Becker's Hospital Review.

And though outsourcing in hospitals is on the rise, experts believe the trend may not persist in the long term. "The driver is the cuts in reimbursement," Adam Higman, vice president at Soyring Consulting, told Becker's. "[Hospitals] know they have to be more efficient and have to save money. That's helping drive [outsourcing] decisions."

Support staff, such as housekeeping and food services, usually bear the brunt of hospital outsourcing, but the healthcare sector has lately seen increased outsourcing in more specialized functions, such as IT and clinical services. The U.S. healthcare IT outsourcing market, the article states, is expected to grow by more than 40 percent over the next five years. The global market is expected to reach $50.4 billion over the next five years, FierceHealthIT previously reported.

Meanwhile, the top five most commonly outsourced patient care services include dialysis, anesthesia, diagnostic imaging, hospitalist staffing and emergency department staffing. "We will continue to see outsourcing in these areas in the next two to three years," John Boland, director of healthcare at consulting firm Navigant, told Becker's.

What makes these services particularly vulnerable to outsourcing is that although they are musts for full-service acute care hospitals, they do not rely on a long-term physician-patient relationship, according to Becker's. The trend may extend even further. Last year, South Florida's Jackson Health System considered outsourcing emergency department physicians, physician assistants and nurse practitioners, FierceHealthcare previously reported.

However, the shift toward healthcare outsourcing may reverse as hospital consolidation increases among hospitals and physician groups, Becker's reported. "What I think is going to happen is as hospital systems get bigger, they may begin creating their own operations," Barnabas Health President and CEO Barry H. Ostrowsky told Becker's. "Outsourcing may start to decline as companies are big enough to perform the services in an equally efficient way."

To learn more:
- here's the Becker's article