productivity

Big Picture:

Allied health providers are challenged to improve productivity without lowering service quality. To that end, we’ve just read an interesting research note from e61 Institute (link below). Here are our key takeaways:

Why it matters:

We are part of the ‘care economy’ that employs over 15% of the workforce, fueled by the NDIS and an aging population. But our sector has had essentially no labour productivity growth for more than 20 years, contributing negatively to Australia’s overall underwhelming productivity growth since the pandemic.

Barriers:

Limited competition between providers in some areas.
Separation between who uses a service and who pays for it (reducing incentives to control costs and to innovate).
Difficulties measuring service quality.
Overlaps and gaps in state/federally funded government services.

Potential ways to increase productivity

Adjust funding models to pay for outcomes, rather than service quantities.
More focus on preventative care and removing funding for care that is not evidence-based.
Better exchanges of ideas about what works/doesn’t work.
Increased technology adoption, e.g. for administration, assessment tools, and to replace some labour and services.
Better vocational training and wages to increase labour supply.
Getting rid of non-compete clauses in employment contracts to increase mobility.
Review occupational licensing and minimum qualification requirements to increase mobility and supply while maintaining quality.

Bottom line:

Given the nature of our work, productivity gains may be easier to find in continuous quality improvements – providing better quality care with the same inputs – rather than providing the same care with less inputs.