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Summer 2023 - Vaccines

Reducing Healthcare Costs for Patients

With economic burdens continuing to pressure the American people, easing the financial strain of healthcare is more important than ever.

The ever-rising expense of healthcare is not only a patient’s concern — it’s also the healthcare system’s responsibility to lower costs. Part of a healthcare provider’s duty is to protect patients from exorbitant fees for even routine procedures. In 2020, U.S. healthcare costs totaled $4.1 trillion, making it one of the country’s costliest expenses.1 Health spending accounted for 19.7 percent of the nation’s gross domestic product that same year.2 That equals an annual healthcare cost of $12,530 per person in 2020 versus roughly $150 per person in 1960.3,4

The United States’ dependence on the health insurance model has increased administration expenses. Studies have found such expenditures make up about 15 to 25 percent of U.S. healthcare costs. Roughly half of those costs are due to the complexity of billing alone. For example, a 2018 Journal of the American Medicine Association study found that American physicians used 14.5 percent of their primary care revenue just on administrative billing costs.5

Add to this the expense of high-tech equipment, treatments, facilities and other indispensable and costly necessities. According to Molly Cooke, MD, FACP, professor of medicine at University of California, San Francisco, “Our country is remarkably generative in the development of new diagnostic tests, drugs and procedures — and remarkably undisciplined in their deployment.”5

Such financial quandaries and bloat have caused healthcare systems to look at ways to reduce costs without compromising patients’ safety or quality of care, requiring strategy. It’s difficult, however, to know where to start, since so many financial strains affect expenses. The following ideas could give providers and hospital systems direction to begin the process of easing the burden on patients.

Prevent Burnout and Turnover Among Healthcare Staff

When it comes to preventing employee burnout and turnover, the major question is: “How can we improve our staff’s work experience?” The answer is to support healthcare staff by empowering them to succeed, equipping them to work more effectively and fostering a positive workplace culture to help everyone, including the patients for whom healthcare workers provide care, by:6,7

  • Offering training and development opportunities such as communication training, cross-training between jobs and team building activities. This not only equips workers to perform their jobs more effectively, but it also decreases worker frustration and offers incentive to stay with the organization. This, in turn, reduces the costs of recruitment and promotes team efficiency and satisfaction.
  • Keeping track of overtime and scheduling, and offering breaks when workload is intense. This fights burnout and increases efficiency because staff is better able to complete tasks when they are less strained.
  • Providing a positive work environment. Offer fun perks and activities like fitness competitions, holiday parties and other beneficial yet interesting events. Show staff they are appreciated and celebrated because of their hard work. Employees who feel supported and valuable are more likely to perform better and desire to work longer term.8

Streamline Scheduling and Patient Flow

Improving scheduling and patient flow is another way to reduce the cost of healthcare without sacrificing patients’ health and safety. Clinics and hospitals can monitor how patients move throughout facilities, then create a standardized plan for managing patient flow. This decreases delays and wait times for patients, saves staff resources and ensures maximum occupancy for each exam room and/or bed. Healthcare institutions can also monitor where and how required staff work at any given time. Such analysis can determine the best staffing strategy for all departments to increase or decrease staff according to the patient census.7,8

Outsource and Bundle Contracts with One Partner

Outsourcing provides another way for hospitals to reduce the cost of healthcare without compromising patients’ health and safety. Specialty support services such as food service, information technology, environmental services and lab services can be outsourced and standardized to reduce overhead, which means more funding is freed up for other necessities. These changes should be implemented strategically, since having too many contracts and protocols with vendors can waste money and diminish patient satisfaction. Carefully standardizing support services with one quality vendor enhances an institution’s culture and ensures streamlined and efficient hospital services.7,8,9

The U.S. spent $4.1 trillion on healthcare in 2020. Where did that money go?
Source: Pie graph on page 17 of the following document:

Create a Patient Satisfaction Strategy

Providing patients with quality care even beyond medical procedures can help prevent operational costs, while also improving patient outcomes. Think about what’s important to patients beyond medical care. Focus on patient facilities, personalized care and friendly staff. Use regular surveys and feedback forms, then follow up with patients about their input to inform your strategy for making improvements. Consider adopting new methods such as using a telehealth platform to offer remote care (which can improve patient satisfaction because it spares patients commute time and costs while improving access to care) or implementing an online portal. Clients appreciate the ease of being able to check their billing, appointments and doctor instructions online.9

Implement Technologies to Reduce Operational Costs

Consider automating technology (e.g., for billing, appointment scheduling and appointment reminders). This not only simplifies processes, but also saves time and contributes to overall improved patient care. Using technology such as electronic health records and electronic medical records can also reduce overhead. Restructuring and utilizing these technologies means staff has more time to focus on providing quality care. It also helps decrease administrative costs and increase staff satisfaction.9

Explore Value-Based Care

Value-based care is a new delivery model that accentuates quality instead of quantity. An analogy of this might be the old adage: “Work smarter, not harder.”

In this model, providers must research the most cost-effective and promising treatment paths and procedures.9 They can focus on providing patients with the most effective treatments at the best price. For example, oncologists can deliver improved outcomes at lower costs by considering various treatments in light of effectiveness versus price. They can concurrently provide access to other support services as needed such as telehealth appointments for conditions and treatments that do not always require in-person visits such as psychiatry services, lab result reviews or follow-up appointments. When physicians offer patients strategic and cost-effective treatment, they can use resources more efficiently and effectively.

Reimagine and Redesign to Reduce Cost

Certainly, major changes like these take effort to research and implement effectively. A learning curve might be in a staff’s future should healthcare facilities choose to restructure their services to provide better patient care at a more reasonable and responsible cost. But such a redesign can also improve overall staff satisfaction by making their work more efficient and patient-focused.


  1. Rama, A. National Health Expenditures, 2020: Spending Accelerates Due to Spike in Federal Government Expenditures Related to the COVID-19 Pandemic. American Medical Association. Accessed at
  2. Federal Reserve Economic Data. Gross Domestic Product. Federal Reserve Bank of St. Louis, updated March 2023. Accessed at
  3. Centers for Medicare and Medicaid Services. National Health Expenditures by Type of Service and Source of Funds, CY 1960-2020. Accessed at
  4. United States Census Bureau. Historical Population Change Data (1910-2020), April 26, 2021. Accessed at
  5. Herbert, F. Cutting the Cost of Health Care: The Physician’s Role. The Texas Heart Institute Journal, 2016 Feb;43(1)4-6. Accessed at
  6. Compass One Healthcare. Three Tips to Reduce the Cost of Healthcare Without Compromising Patients’ Health and Safety. Accessed at
  7. Compass One Healthcare. Cost Reduction Strategies for Health Systems. Accessed at
  8. Mann, A, and Dvorak, N. Employee Recognition: Low Cost, High Impact, June 8, 2016. Accessed at
  9. Guideway Care. 4 Easy Tips to Reduce Operational Costs in Healthcare, Aug. 16, 2022. Accessed at
Meredith Whitmore
Meredith Whitmore is a freelance writer and clinical mental health professional based in the Pacific Northwest.