According to an article in the Pittsburgh Tribune-Review, UPMC will be outsourcing its medical transcription services at the end of June. The move will result in the layoffs of about 100 medical transcription workers.
The medical transcriptionists are expected to be rehired by Nuance Communications, Inc.
In a medical setting, those actually caring for patients arguably have the best understanding of how much staff is needed to do it properly. In light of this, a new bill has been introduced to Congress that would allow registered nurses to have a larger role in hospital staffing levels.
Staffing Levels Outcomes
The Registered Nursing Safe Staffing Act of 2013 (H.R. 1821) is a bipartisan bill sponsored by the co-chairs of the House Nursing Caucus. It has the backing of the American Nurses Association (ANA), who claim that higher staffing levels are directly linked to better patient care. Research shows that appropriate staff levels lead to lower rates of patient falls, infections, medical errors, injuries, and death. When negative events occur at a hospital, low staffing rates are usually a contributing factor.
What the Bill Entails
The safe staffing bill would require that hospitals establish committees to create unit-by-unit staffing plans. Their plans would take into account several inputs, including number of patients per unit, experience of the floor nurses, and technological capabilities. It would also require that hospitals that participate in Medicare would have to publically report the nurse staffing plans for each unit, provide whistleblower protection for those who complain about staffing, and place limits on the practice of “floating” nurses.
Implications
If the bill passes and nurses have more say in staffing levels, we might see high demand for more nurses to fill positions. Temporary nurses might become more needed, and therefore staffing companies will also see an uptick in demand for their services. Factors will be busy funding these institutions so that they can grow their operations. Hopefully the ultimate end result of this legislation will be better patient care at hospitals—then everybody wins.
As we pointed out in our last post, skilled care facilities are facing a growing shortage of nursing aides. A number of factors contribute to the high turnover rates, but chief among them may be the high rates of injury among the aides.
Nursing aides have a very physical job, and must work long shifts on their feet and lift willing and unwilling patients regularly. Nursing aides say that they are often required to look after more patients than they can safely handle—on average, one aide for every ten patients. A telling statistic is that nursing aides suffer more occupational injuries than construction or factory workers.
The high number of injuries leads to a high turnover rate—between 34-75% of nursing aides turn over every year. This is costing the industry much, about $6.3 billion a year, in terms of hiring and training new workers, and experts say the costs could be reduced if better working conditions were implemented.
According to a recent article appearing in the Wall Street Journal, a worsening labor shortage in the care of the elderly is hitting the country just as older generations need help most. Looming retirements in the current labor force, of which one-fifth is over 55, is also a big concern of skilled care facilities and home-care agencies. The three major reasons for the staffing shortage are:
1. Low pay: The median pay for nursing aides is $11.74, almost $5 less than the national average of all occupations at $16.71. Some nursing aides start hourly at barely above minimum wage. Nursing home operators say that while they would like to increase pay, recent cuts in Medicare and Medicaid reimbursements make it impossible to do so.
2. High injury rates: Occupational injury rates for nursing home aides are higher than that for factory and construction workers—almost double the yearly rate. Back injuries are prevalent as their duties include lifting patients out of bed, and they are often are bitten, kicked, and spat upon by residents with dementia.
3. Draining work: According to nursing aides, as the shortage continues they are asked to work more hours and care for more patients than they can handle. Industry turnover is high at 43%-75%, compared to other health occupation turnover at 28%.
This story is important for factors and brokers to know about because skilled care facilities and home care facilities, prime factoring clients, are going to face cash flow shortages. Government agencies are giving less money back and facilities need more employees to cover the shortage, a combination which means a shortage of cash. Factoring companies are in a position to help these institutions through this tough time and ensure that the elderly are always cared for.
2013 is starting off on a good note for some sectors; the question is, will this translate to job growth? According to this Wall Street Journal article from Tuesday, recent positive figures from the consumer and housing sectors are causing economists to raise their growth estimates for the first three months of the year. The revised rate of 3.5% would be the fastest growth pace since the end of 2011 and a kick-start from the stall at the end of last year.
Job Growth Slows
Job growth, though, seems to be slowing down in March compared to February. The Labor Department showed that hiring slowed to 88,000 jobs in March, which is less than half of the estimated amount. These underwhelming results are tempering optimism about sustainable economy growth. It is in following with a recent trend of strong winter months and then a seasonal slowdown in spring- what some call the “April Fool’s Economy.”
Overall Picture
While looking at month-to-month data can be useful, economists warn not to put to much stock into monthly results. It remains to be seen whether economic growth will follow recent year trends and slow down over the year, or break the chains of post-recession blues. Like the old adage warns, let us hope for the best while expecting the worst.
In 2010, the U.S. Department of Health and Human Services (HHS) introduced measures that lay a groundwork for the widespread adoption of electronic medical records (EMR) within medical institutions. Electronic medical records are a digital files containing health information about patients that are typically filled out by doctors.
With these electronic medical records now mandated by Obamacare, does that leave any room for flesh and blood medical transcriptionists? Medical transcription is the process of converting voice-recorded reports dictated by healthcare professionals into text format. The transcription industry has faced threats before, such as outsourcing and voice recognition software, but the mandated EMRs are likely to reshape the whole transcription industry.
Almost everyone agrees that completely electronic records will never eradicate the need for medical transcription. Instead, experts say that future transcriptionists will simply need to augment their existing skill set with new EMR structure knowledge. The job will evolve with technology, just like every other industry must. Accurate health documentation is a must, and the human touch is still needed when it comes to doing so.
For more information, see How EMR is Going to Affect Medical Transcription Industry
Though often overlooked, the trucking industry is vitally important to the health of the US economy. Think about it: without truck drivers delivering goods, interstate commerce would grind to a screeching, tire-burning halt.
Unique Challenges
Despite the importance of trucking companies, the way the system is structured often leaves them in a shaky financial position. Truck companies submit invoices for services rendered, and then often wait 30-90 days for payment on the accounts receivables.
For a bigger company with large cash reserves, waiting to be paid would not be a problem. But for small to mid-size companies operating on a tight budget, it might not be an option. Expenses such as payroll and gas add up in the time between payment, and not paying your drivers is never a good business practice. Add to that rising fuel costs, delays due to traffic congestion, driver shortages and new regulations, and it is a recipe for financial hardship.
Therefore, trucking companies often have to turn to outside financing. The following are some options for trucking companies to consider:
Asset-Based Lending
Also known as factoring, this options refers to the process by which businesses sell their accounts receivables to a factoring company. Approval for factoring is based on the creditworthiness of the trucking company’s customers.
At the time of the sale, the client gets 80-90% of the cash back immediately from the invoices. The remainder of the balance comes after customer repayment, less a percentage fee that typically ranges from 1-5%.
This option is best for B2B companies that cannot afford to wait for payment, and the cost is usually 4-5% monthly with an effective annual interest rate typically between 18-30%.
Bank Loans
Though hard to come by, bank loans are often the cheapest form of financing. The loan process involves an application and review of the company’s creditworthiness and financial history. Small companies especially tend to be turned down for loans, although exceptions do exist.
After approval, fund disbursement usually takes about 30-90 days to reach a trucking company’s bank account. This form of funding is best for trucking outfits with a great credit history and don’t need the money immediately.
Cash-Advances
Cash advances take place when a company receives an advance sum from a lender. The company pays the lender back with percentages of their monthly card receipts until the loan (plus a predetermined rate) is repaid. There are legal limits to the rates, and they cannot be changed retroactively. The benefit to cash advances is immediate cash- it is the fastest method for obtaining cash without going to a loan shark.
This financing method is best for trucking companies who need immediate cash for a short amount of time and have limited financing options. The cost is usually 20% and up.
Lease-Back
A trucking company may choose to sell property, plant, and/or equipment, and simultaneously leases it back for cash.
It is best for trucking companies with valuable plant or equipment assets that are underutilized, and the cost is monthly lease payments plus the depreciation and tax burdens of equipment.
Choices, Choices
Every trucking company is unique, and it is up to them to find funding solutions that meet their individual needs. Being informed on all the options is the first step toward finding a suitable cash flow solution.
Waiting to get paid for work you have already done is a pain, but waiting for money when you have bills to pay is a huge problem. Trucking companies in particular often face cash flow problems when invoices from loads go unpaid for long periods. The work is done, but the cash is often tied up in accounts receivable. For a large trucking company with consistent cash flow, this might not be a problem—but for small and medium sized companies, sometimes waiting to be paid is not an option.
Freight factoring is one alternative financing option for trucking companies that get rejected for a bank loan. Approval for factoring is based on the credit worthiness of the freight customers, not the company’s credit, and therefore is much more likely than with a bank. Factoring is also a flexible option that allows for same-day cash. Here are the steps to take when deciding to factor freight:
Do research: Only choose factors with knowledge of the industry. Not everybody has someone on the staff who has worked with the industry before, so be picky.
Don’t hurry: Plan in advance so you don’t feel obligated to factor invoices urgently. Doing so could result in getting caught in a contract that you don’t want, or making costly mistakes. Take your time and find the best fit for your individual needs. Some companies offer back-office billing services or one-time invoice factoring agreements. Figure out what is best for you.
Start the process: Contact the company and you will get placed with an account manager. They can help you navigate the process and start getting cash right away for your receivables.
For more information on freight factoring, see here.
The first effects of sequestration are starting to be felt, and staffing agencies are feeling the ripples. Some in the recruiting industry are starting to see signs of agitation in the workforce market as companies begin to change their hiring strategies. According to the Washington Post, the current trend seems to be companies turning to staffing experts and wanting a “super multitasker” that can do the jobs of many. Many hiring managers also want to hire as soon as possible, because as the sequester drags on it could decrease the budget even more.
As more clients turn to staffing agencies, the agencies themselves may be in need of increased cash flow so they can accept more business. Factoring companies that specialize in the staffing industry should take heed, as they might see an increase in demand for staffing and payroll financing. Turmoil often leads to opportunity, and it’s those who take advantage of opportunity that come out on top.
Factoring professionals, do you have a few hours to spare a day between April 30th and May 2nd? Before you say no, keep in mind that you wouldn’t even have to leave your desk. The Commercial Finance Association (CFA) is hosting a three day virtual workshop on 2013 Factoring and Managing Client Risk.
Those who should attend include:
Existing or new employees of factoring companies
Those in operations, account executive and credit/underwriting roles that either want or broader understanding or a comprehensive refresher in general principles
Staff members in specialist (accounting, branding etc.) or new business roles that want a broader understanding
For those interested, sign up here. Continuing education is important for those who want to stay on top on trends and on top of the industry.
