Healthcare and its rising costs have become a contentious issues within America and abroad. Healthcare costs, unlike other aspects within a developed society are not cyclical. Costs related to healthcare don't move in tandem with economic activity. Instead, as historical trends indicate, it continues to rise as the populations of developed countries become older. The United States is no different in this regard. Healthcare costs as a percentage of GDP continues to rise. The Centers for Medicine and Medicaid Services found that health care spending grow at 5.3% in 2014 to over $3 Trillion. This rise in healthcare spending accounting for over 17% of the United States GDP in 2014. Furthermore, the 5.3% rise is spending far outpaces the 2% to 3% historical rise in GDP. If the trend continues, as experts believe it will, healthcare costs will quickly take larger and larger portions of our nations GDP (Mahar, 2006). Costs must therefore be lowered in an attempt to make the industry more competitive will also lowering the burden on families throughout the developed world. As it relates to Nightingale Home Care Inc., the company should look to technology and innovation to improve its competitiveness within the industry. This proposal looks to improve corporate efficiency while reducing costs through the implementation of an EMR system. The chosen piece of equipment for the documentation of EMR home visits is the HP Spectre 13 laptop. This system, when fully functional will allow the company to reduce costs through error reductions. It will also help improve efficiencies through rapid customer record retrieval and a reduction in bureaucracy. Through both of these initiatives not only will the company improve its profitability and competitive position, but it will also enhance the quality of service to all patients.
To begin, costs are a major concern for the industry overall. Legislation such as the Affordable Care Act, a rapid increase in the insured population, and an aging baby boomer population creates significant opportunities for Nightingale Home Care Inc. (Manning 1988). With the HP Spectre 13 laptop, costs over the long-term can be reduced, while also improving quality of care. Currently the equipment costs over $800 per laptop to purchase. Fortunately, the laptop already comes equipped with the Windows 10 suite of applications, and its touchscreen. This reduces the costs associated with the purchase of software. Also, the laptop has strong battery life, lasting over 9 hours on a single charge. This is well in excess of the industry average of 6 hours per charge. Ultimately, the laptop offers superior performance at a reasonable value. It is fast processing speeds, has a long battery life, already comes equipped with the necessary software, and it's reasonably prices compared to competitors.
As mentioned in the introduction, the company benefits substantially from the purchase of the HP laptop. It first saves the company money on both supplies and paper. Supplies such as pens, pencil, notepads, copy paper, and ink will all be substantially reduced through the purchase of the HP laptop. Employees will no longer need to search through countless stacks of papers, or sift through an endless sea of manila folders. Instead, employees can quickly access information, files, and paperwork from a centralized location. Technology also helps employees reduce costly errors and miscalculations. Medical malpractice continues to grow as the overall insured population has now ballooned. Lawsuits alleging negligence of improper treatment can therefore become costly. Proper retention of medical records is therefore critical to saving the company money, but also for protecting the company. Medical records are often the most sacred and classified information a person has. Treatments, diagnoses, payments, credit card information and social security numbers are often found in hospitals. Those will malicious intent have a strong willingness to steal and use this information for nefarious reasons. Standard paper and physical copies can easily be forged, or stolen. With the right technology and the application of EMR systems, patient information is much safer.
Billing and collection can be quite difficult for many firms in the healthcare industry. Varying insurance coverage, insurance companies, and payment methods further complicates the issue. Through proper implementation of an EMR system, these processes can become streamlined. The HP laptop is critical to this as it can help process information faster, while also keeping track or records and purchases. This will allow the company track expenses...
Nightingale Home Care will also be in a better
position to pinpoint exactly where errors are occurring in the company's overall cost structure. For example, the company will be in a better position to pinpoint salaries as a percentage of
revenue to see if staffing levels are appropriate.
Quality of care is vital in regards to home healthcare industry overall. The value proposition of Nightingale must be compelling relative to other alternatives in the industry. Through the use of the HP laptop, the quality and security of service is enhanced. Patient information for example, can be easily and seamlessly accessed. In need be, this sensitive information can be transferred in a safe and secure manner through the EMR system. The laptop itself is portable and easy to carry as care is administered. The laptop provides convenience in the form of emailed invoices, online payments within the home, patient signatures, and a reduction in data entry errors.
Profit maximizing organizations are looking to earn a return on the capital they deploy in a business. To justify the expenditure on laptops, the company must earn a return. This can come in the form of reduced costs, or increased revenue. In this instance, both could possible occur. To support these initiatives however,
management must formulate goals. These goals in regards to the HP Laptops would be twofold. First, productivity enhancements must be measured. This will come in the form of a reduction in data entry errors, customer service scores, and overall quality scores. The first goal is relatively straightforward. Over the fiscal quarter after implementation of the new laptops, did data entry errors decrease substantially. To measure customer service scores, the firm could use the Net Promoter Score which is commonly used in the
retail industry to measure satisfaction. Finally for quality improvements, the company can use repeat purchases, patient growth, and revenue per customer as guides to the overall improvement of quality in the service.
The primary stakeholders of the project consist of patients, employees, shareholders and the community. In regards to patients, the aim is to improve the overall quality of service. Through this improved service, we hope to increase patient growth, revenue per customer, and strong customer satisfaction scores. If the patient is being treated properly, in should reflect in one of the above metrics. In regards to employees, they are impacted by a shift in their normal work operations. Some, particularly the older employees, may need to learn an entirely new method of delivering a service. This could cause resistance and
conflict within the company. However, through proper training, conversation, and insights, an apprehension should be eliminated. Shareholders, as mentioned earlier, are looking to earn a return commensurate with the
risk of the venture. This project does that by reducing costly errors, increasing efficiency, and enhancing service quality. Finally, the community is impacted through our employees and the work that they do. Healthcare not only impacts a patient, but it also impacts families. It is therefore important that entire staff realize that a happier patient ultimately enhances the time and quality of time that they spend with
family.
Generally any capital investment project is not without its risks. This project is no different in that regard. In terms of purchasing, risks include not realizing the efficiencies and benefits discussed in detail above. Customers may not like the use of laptops. Employees may become resistant to change and delay the overall implementation of the project. The systems and laptop may not be compatible with each other as was previously thought. Bugs and malfunctions can occur throughout the process. Employee theft of personal records and the laptop itself can occur. The laptops may break or more importantly, become obsolete, and require replacement. All of these instances will undoubtedly add costs to the overall project. Some are minor such as malfunctions, while other is very major such as employee theft of confidential records. Although these circumstances can occur, the likelihood is relatively small in relation to the overall benefit that could be achieved
Not purchasing the products can be worse. The overall quality of care relative to competitors in the industry would diminish. Patients could leave and elect to use the more technologically advanced health care provided. Customers often are willing to pay premium prices for top notch health care. The
perception of substandard care could negatively impact the company both in reputation and in the overall patient count. The company risks becoming obsolete as federal and state regulations are now shifting towards the use of electronic means of health care servicing. Below is the
budget associated with the overall capital spending proposal.
Line Item
Cost
Optional / Not Optional
HP Spectre Laptop
$800 per laptop,…
