The U.S. healthcare system is shifting. Healthcare systems are adapting to a change in demand, and therefore, are forced to think creatively about how to maintain safe and competitive staffing levels while looking for new ways to save on costs. To know where we’re going, it’s important to first now how we got here.

Following the emergence of the COVID-19 pandemic, hospitals were forced to quickly adapt their staffing models to better meet the overwhelming demands for patient care. The sudden, massive influx of patients forced many hospitals to rely heavily on contingent labor— a temporary workforce made up of staff members not directly employed by the organization— as their only option.

A well-organized, effective contingent workforce became an invaluable resource in meeting increased needs for healthcare services during an unprecedented time. The benefits of deploying a large-scale contingent workforce were clear, as were the downsides. Third-party, agency-provided contingent labor often comes at a premium, both in quantity (due to a limited supply of qualified candidates) and in cost. Due to demand, some healthcare systems experienced a top-heavy reliance on costly third-party contingent labor.

As the COVID-19 pandemic continued to recede and inflation levels reached above 8 percent, healthcare systems across the country began looking for ways to make up for the burdensome cost of maintaining a standard of care during the pandemic. Now, we are in the midst of a significant course correction in healthcare, with an industry shift focused on matching supply with demand in order to cut back on costly contingent labor.

Across the healthcare landscape, hospitals and healthcare systems are approaching this shift through different lenses and with different end goals in mind.

Traditionally, workforces are built with a mix of core (full/part-time), shift coverage through PRN, float pools, overtime, and contingent labor or travel. Percentages vary, as each system constructs its workforce differently. Ideally, the “pyramid” is constructed with a sturdy base of core staff and PRNs that can absorb the majority of required coverage. In the event of a surge in demand, hospitals can pull different levers, including the use of float pools, per diem, or other types of contingent labor.

Another approach that healthcare systems are taking is to place more emphasis on the utilization of internal float pools and per diem staffing. Hospitals are becoming more adept at constructing their own internal float pool and per diem program through the use of next-generation technology, such as Trio VMS. By building up a well-maintained, adequately supplied internal float pool, healthcare systems can change the type of contingent labor from third party contingent labor to in-house, shift-based work, cutting out sometimes-costly third-party agency fees.

The key lies in striking a balance between leveraging contingent labor appropriately while simultaneously focusing on long-term strategies that are more cost effective and efficient, such as building out an internal float program.

If you are interested in learning more about how healthcare systems are combatting the changing tide, get in touch with our team of experts to learn more. Our high-powered VMS, Trio VMS, is a leading-edge VMS in the healthcare industry, supporting nursing, allied, Locum Tenens, non-clinical, and per diem.