HHS Blog

From Linen Loss to Financial Gain: How HHS LUM Saved $652,000 in One Year

Written by HHS | Oct 25, 2024 5:00:00 AM

What is LUM?

Linen Utilization Management (LUM) is the series of processes, managers, educational content, and strategies that help healthcare facilities organize and optimize the utilization of resources. HHS developed our LUM program to assist facilities with the management of the linen services needed to provide excellent care for patients and help mitigate unnecessary expenses. HHS has designed LUM to be risk-free with zero upfront costs to the customer.

I have enjoyed the partnership and willingness of the leadership team to align priorities. We were able to have transparent conversations when goals were being set to focus on issues that were important to us as the customer.

- Vice President of Patient Services

Challenges

Integrating additional support services into an existing healthcare ecosystem can be a challenge under the best of circumstances, but what about when all of the other support services are being operated by a different vendor?

HHS employs a meticulous approach, marked by empathy and strategic planning, when introducing innovative support services such as LUM. This proven methodology was pivotal to the accomplishments of the client, a facility currently partnered with a competing service provider.

When every single team member is driving towards running the facility at peak efficiency, healthcare providers can focus on care, and patients can focus on healing. This shared vision enables HHS to work with other vendor partners to propel a value-added service like linen management to success.

Results

HHS started on-site in June 2023 with a request for support from the existing staff. Transparent communication, coupled with a newly established Linen Committee, would ensure that everyone felt heard, and that the new initiatives would have the buy-in needed to succeed.

Communication and partnership required new approaches and education for success, and our interactions with the laundry facility greatly improved while service levels also markedly improved.

- Director of Operations

Success: Education & Adoption

LUM had a straightforward goal – ensure that no one took linen for granted. The results speak for themselves.

Implementing LUM doesn't reduce linen availability but rather improves accessibility and promotes mindful linen consumption while providing what is needed for patients. By teaching staff how to use items effectively and properly dispose of soiled linen and rejects, we can reduce waste, lower processing costs, and minimize loss charges by teaching proper disposal methods.

Linen usage can be measured in a few different ways at a healthcare facility, but chief among them is pounds per adjusted patient day (PAPD). This is calculated by dividing the total weight of linen delivered per month by the number of adjusted patient days (adjusted days are calculated by balancing patient revenue by inpatient and outpatient services). 

Success: Loss Prevention

Linen is often an overlooked asset in healthcare, despite its significant impact on operational costs. Large healthcare facilities like this client can consume millions of pounds of linen annually. This high volume makes it challenging to track linen accurately, creating opportunities for loss. Linen loss is measured by a metric called Clean/Soiled Variance (CSV), which compares the amount of clean linen sent to a facility with the amount of soiled linen returned. Ideally, the CSV should exceed 105%, as soiled linen weighs more than clean linen. However, this facility initially experienced a CSV below 98%, indicating substantial linen loss.

To address this issue, the site implemented the LUM program and dedicated resources to linen management. By prioritizing education, awareness, and staff satisfaction, the facility was able to significantly reduce linen loss. The implementation of two linen utilization managers played a crucial role in achieving these results.

After one year of service, the client saw their CSV rise from 98.4% in 2023 (indicating linen loss) to 105% in 2024 with HHS LUM. With average replacement costs of $4.50 per pound, this amounts to approximately $489,055 in just loss prevention savings in the first year of implementation.

Treating linen like an inevitable cost of business can be extremely expensive and, importantly, avoidable.

Success: Linen Utilization

Before launching our linen utilization management program, HHS conducted a thorough analysis of the facility's linen usage, costs, and patient volume to establish a baseline of pounds per adjusted patient day (PAPD). This location's initial PAPD was 7.25. Within the first year of the program, we successfully reduced PAPD to 5.96. The program’s sustainability is key to maximizing long-term savings.

To date, we've generated $198,483 in cost savings solely through linen utilization improvements. Anticipating continued success in loss prevention and utilization, we project approximately $652,000 in savings for the entire year.

Success: Nursing Satisfaction

When LUM was first introduced, nursing satisfaction was notably low at 77.81%. Nurses primarily cited issues with handling reject linen, inconsistent linen par levels, and unreliable weekend deliveries. By collaborating with our competitor on distribution and implementing a robust reject linen education program, LUM successfully addressed these challenges, increasing nursing satisfaction by 11 points to 88% within the first year.

Another significant area of concern was the quality of the existing scrubs program. HHS LUM played a pivotal role in launching a new program to enhance nursing satisfaction and address these issues.

Through comprehensive education on proper linen handling, disposal, and alternative product options, we've demonstrated how small changes can yield substantial improvements. Combining this with dedicated management oversight, open communication, and teamwork, LUM can effectively integrate into existing vendor relationships.

A key challenge was the facility's strained relationship with its linen vendor. HHS LUM acted as a crucial intermediary, fostering a strong partnership with the linen plant through in-depth operational knowledge. This collaboration ensured consistent linen availability.

Success: Mutual Benefits

The mutual benefits of LUM were shared among the hospital, the nursing staff, and the laundry cooperative. The initial advantages included financial savings due to reduced resource consumption and minimized waste and loss due to improved collaboration with all stakeholders. While the cooperative laundries gained a smoother workflow, improved order fulfillment, and enhanced accuracy in revenue forecasting.

Together, the partnership yielded quantifiable benefits, shared successes, and advantageous outcomes for all parties involved.