Healthcare Employer Costs Rising in 2023
How Much Will Employer Healthcare Costs Increase?
Healthcare employer costs are set to rise by as much as 6.5% in 2023 compared to 2022, affecting most healthcare facilities and hospitals nationwide. The reasons for these higher costs are partly inflation affecting the nation, and somewhat other health reasons that affect patients directly: for example, many Americans, in general, are getting sicker more frequently and have a general deterioration of their health, at the same time as the population is increasing. A solid reason is also that the tests and examinations that are performed on patients are done on an individual basis, i.e., every time a test is needed, it is paid for, and not for the quality of the tests and examinations, which results in more healthcare employees seeking to perform more tests to make more money. Doctors often order optional tests because they are part of protocols that, if not followed, can get them in trouble for malpractice. In this case, updating protocols might be a great way to decrease costs.
Many employers have noticed rising healthcare costs and have budgeted the average increase per employee to $13,800. These employer health costs should be covered by the companies that saw a reduction in the health budget during the pandemic. Although the employee budget is being reduced by a third, inflation is wreaking havoc on employers’ budgets, increasing by 6-6.5%, which is estimated to continue to rise over the next three years.
One of the ways that companies can alleviate some of these significant health cost is through chronic disease prevention: that is, if companies invest more in their employees leading healthier lives, health costs will likely decrease, as preventable chronic diseases are the costliest to health insurers, and among the most affecting the population nationwide. Improving employee health would be a long-term answer and one in which hospitals and employers of all companies should invest.
Unfortunately, most employers decide to alleviate these per-employee costs in the short term by cutting costs for lower-paid employees or by taking from employees’ earnings directly to cover healthcare costs. Of course, it is up to healthcare facilities and hospitals to find long-term solutions to reduce unnecessary healthcare costs and find alternatives, such as combating fraud or waste in their hospitals. They can also look for ways to combat employee costs, such as PRN contracting.
What Does PRN Mean in Healthcare?
Another way to decrease said budget is through PRN hiring since a large part of the high healthcare costs lies in the shortage of healthcare personnel, which costs healthcare facilities and hospitals dearly. What usually happens is that healthcare employers have few employees, and they have to pay high costs by hiring at the last minute or through specialized agencies. It even happens that, unable to hire anyone to cover shifts, they lose money by losing patients (who have gone through long waiting times or who do not receive the quality of treatment they need precisely because the staff is significantly reduced) or staff who are exhausted by overwork and stress.
PRN stands for pro re nata, which in medical abbreviation means “as required,” a term used to express the need to utilize a medical resource in high demand. Regarding contracting, PRN jobs and shifts are temporary, calling on healthcare personnel when required by a healthcare facility or hospital. Hospitals can save a lot of money through PRN hiring because, although the hourly wages they offer are higher, PRN shifts save precisely the money lost in agencies, in time spent looking for employees at the last minute. The money they could lose by having good employees quit due to extreme fatigue. There are many advantages to hiring PRNs, especially when using a popular PRN search app, such as Nursa. For example, the employees they hire tend to be very flexible and quick to adapt to new work situations precisely because they are used to changing workspaces quickly. Another advantage is that they cover empty shifts and their employees feel the relief of having helping hands when they need them most. Of course, there is the advantage of saving quite a bit of money yet still paying what is fair without middlemen to each employee. Many nurses and other healthcare personnel are opting for PRN employment because there are also many advantages, such as choosing their shifts and schedules, having better pay, and gaining more experience in different work settings. This could be a long-term solution to reduce health costs.