Wisconsin hospital uses employee wellness, energy management to cut costs

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Cost-cutting is a major focus for all hospitals during the recession. Some hospitals are in survival mode, instituting cuts designed to keep the doors open rather than to position the facility for long-term prosperity. For example, Kent Hospital in Warwick, R.I., has laid off all 46 of its licensed practical nurses and plans to replace them with 12 registered nurses and an unspecified number of certified nursing assistants to save $1 million annually. Kent also will outsource its rehabilitation services to save another $1 million, reports the Providence Journal. And San Joaquin General Hospital in Stockton, Calif., will save some $500,000 a year by cutting operating hours at its cancer clinic and lowering the income threshold for low-income patients who receive free medical care, according to The Record.

However, other hospitals are thinking outside the box to improve the bottom line. Froedtert & Community Health in Milwaukee, Wis., began a comprehensive employee wellness program as part of a three-year initiative to earn Milwaukee a Well City USA designation from the Wellness Council of America, reports the Business Journal of Milwaukee. The health system launched the program "because it was the right thing to do," but the result was significant savings, says Bill Petasnick, president and CEO. "In the end, we were able to reduce our own health spending close to $1 million."

In addition, Froedtert has trimmed $500,000 in energy costs during the first six months of fiscal 2010 and is on schedule to cut those costs by $1 million by June 30. The "culprit" is a real-time data monitoring system from Johnson Controls Inc. that allows the hospital system to manage the energy consumption of its 3.2 million-square-foot campus. Froedtert can detect and adjust problems as they happen rather than waiting for the monthly bill from the power company and reacting after the fact, explains John Balzer, vice president of facility planning and development.

Saint Michael's Medical Center in Newark, N.J., also is finding new ways to save. The hospital will be able to track more than 2,000 pieces of equipment, including heart monitors, infusion pumps and ventilators, using ultrasound receivers and tagging technology (i.e., IBM's Real-Time Location Services software and Sonitor Technologies' ultrasound infrastructure), reports InformationWeek. Not only will the tracking system reduce the amount of time that nurses spend looking for lost equipment, it also will ensure that technicians service equipment more efficiently and on a consistent schedule, says Angelo Schittone, vice president and chief information officer.

To learn more:
- read the Providence Journal article
- read this The Record article
- check out this article from the Business Journal of Milwaukee
- read this other article from the Business Journal of Milwaukee
- check out this InformationWeek article