Over these past couple of years, healthcare emergency management and business continuity (BC) plans have been rigorously tested. As a whole, there seems to be an acknowledgment that the response and coordination activities that are involved in day-to-day operations are strong. There is, however, an area that has been found lacking that must be bolstered: formalized business continuity and resilience.
Senior Solutions Engineer Anthony DeGeorge and Healthcare Account Executive Lance Lynch, MBA, CBCP, as practitioners themselves, recognized this gap and wanted address the barriers, the opportunities for improvement in terms of how we look at resilience itself, as well as how Veoci can help your organization improve your business continuity plan.
This blog post is a summary of a previously held webinar, which occurred on March 31st, 2022. If you’d like to see the recording, you can access it here.
Costs of Maintaining the Status Quo
As in any industry, there are barriers when it comes to establishing a business continuity program. Whether it be the training of stakeholders, approval and support from senior leadership, buy-in from departmental leadership, or tracking the status of deliverables from departments, every organization is facing a hurdle that they must confront. So how can you overcome these barriers? Look at the cost of the status quo.
Though there are many costs, Lance and Anthony focused on four key ones within the healthcare sector:
- Loss of Life
- Reputational
- Regulatory
- Financial
Loss of Life
Loss of life is, of course, the biggest cost when it comes to not having active and formalized business continuity plans. Two storms were presented as examples, Winter Storm Uri and Hurricane Irma, both of which took the lives of patients.
Winter Storm Uri blazed through Texas in February of 2021. The Texas Department of Health and Human Services reported 246 deaths, with over 30 Long Term Care (LTC) facilities evacuated. Both the deaths and the evacuations were blamed on not having workarounds or back up plans when it came to things such as power, heat, fresh water, etc.
Hurricane Irma had a huge impact on the State of Florida, with Hollywood, Florida reported 12 lives lost in a nursing home due to power outages and therefore air conditioning outages. According to a Brown study, they suggest that there are 421 deaths within the Florida LTC community that can be tied to the storm.
Both Uri and Irma highlight a potential lower than appreciable amount of business continuity and resilience plans within LTC’s. If there had been up to date and functional plans, the hope is that the loss of life would not have been as tragic.
Reputational
When an event occurs and a response doesn’t go as planned or lacks a level of resilience that a community expects, finding where to place the blame is quick to follow.
Even now, over a year after Winter Storm Uri, there is (understandably) fallout for the lives that were lost. Power Grid Managers within the affected communities in Texas are still feeling the reputational costs, and feeling the effects of not having proper plans in place.
Regulatory
Managing a PR disaster is not the only cost of staying the same. A less than resilient response can lead to loss of licenses, which then can influence access to federal or state funds, as well as being stripped of accreditations.
If the aforementioned occurs, the trickle down continues, leading to loss of jobs, which begins to directly impact the community the healthcare system is in.
Loss of utilities is not considered an appropriate reason for clinical care failure. Unexpected events that lead to an outage will not be pardoned by regulatory standards. So what does that mean? It means that recommendations are important, and don’t represent the bar that must be met, but instead, the expectations that can be exceeded with a functional business continuity plan.
Financial
If the loss of life, reputational and regulatory costs aren’t enough to persuade your organization to take immediate action on their business continuity and resilience plans, perhaps some numbers and dollar signs might do the trick.
Below demonstrates the average financial cost of an IT outage:
- $7,900 / Minute (Ponemon)
- $740,357 / Incident (Interbit)
- $140,000 – $540,000 / Hour (Gartner)
So what does that all mean? It means that when an IT outage occurs, on average, an organization is looking at spending $14 per bed, per minute. That doesn’t sound terrible, but when you do the math for a hospital with hundreds of beds, the numbers paint a different picture.
Let’s keep the average of $14 per bed, per minute, and pretend the hospital has 300 beds in total.
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$14 x 300 beds = $4,200 per minute
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$4,200 per minute x 60 minutes = $252,000 per hour
A 6-hour downtime brings you to $1.5 million
A 12-hour downtime brings you to $3 million
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To put this into perspective, 69% of Texans lost power due to Winter Storm Uri. The average disruption was 42 hours – 31 of those being consecutive. A hospital who experienced that downtime would be facing a business continuity cost of over $10.5 million on top of all other associated costs.
Another way to take financial cost into consideration when putting together a business continuity plan, is to calculate what your highest revenue generators are within your organization. These revenue generators can be anything from operating room or surgical services, to laboratory or pharmacy services.
This is not something normally considered within emergency management planning, but it is something to consider in BC; there needs to be an understanding of what areas of the hospital should be prioritized when everything goes down.
The Joint Commission’s Revised Standards
The Joint Commission has revised their emergency management standards, and they are effective come July 1st, 2022. You can find the new revisions here.
Within the new revisions, there seems to be a shift in the use of resilience buzzwords. For example, the number of times “continuity” shows in the revisions is double than in the current standards. Phrases such as “Disaster Recovery”, “Supply Chain” and “COOP” were also mentioned for the first time within the revised standards.
The addition of these buzzwords demonstrates that formalized resilience is a gap that needs to be addressed–hence the upcoming revised standards. As the industry shifts its focus from reactivity to proactivity, it is important to have a software that helps your organization make the necessary revisions so come June 31st, you are prepared for a survey.
Step Over the Bar With Veoci
Anthony was able to spend the rest of the time showing attendees a demonstration of Veoci and how the business continuity plans work for healthcare organizations. Anthony was able to demonstrate the flexibility of Veoci, and how the platform can adapt to the different levels of maturity within business continuity programs of healthcare organizations: basic, intermediate or advanced.
The beauty of the platform is that it can grow with your program. If an organization starts with a basic set up but after a bit decides to make it more detailed and collect more data, the information that is already documented can be pulled forward and will serve as the foundation for the new plan.
Anthony walks you through the entire process from triggering the plans to reviewing information on dashboards in the demonstration. To view it, navigate to 24:40 within the recording.
Moving Forward
Every industry understands that business continuity helps when it comes to saving money. Healthcare is unique in the sense that the focus of business continuity is on the community.
Within the healthcare community, it has been proven that we are great at reacting when it is necessary. The emphasis, however, should now be placed on how proactive we can be which saves organizations from paying the costs of staying the same, but more importantly, allows us to serve our patients and our communities.
