Healthcare Linens: Should You Outsource Service or Keep On-Premise?

Updated on November 2, 2012

This article outlines key factors to consider before outsourcing linen service.

By Joe Shough

The business of healthcare is becoming more complex with each passing year. But there are a few critical aspects of running a hospital, clinic or nursing facility that should not be complicated, such as securing electricity, water and linens. You count on the power and water company to deliver quality service on a consistent basis and at a reasonable cost. The same can be said for healthcare linens.

It’s only when these critical services aren’t available as needed, lack quality or cost too much that they come under scrutiny, as they should!

Outsourcing Linen Can Bring Significant Savings

As healthcare reimbursements decline and costs increase, I have observed that many healthcare organizations can achieve significant savings by partnering with a linen expert and outsourcing their service. This article outlines key factors to consider if your organization is evaluating the pros and cons of outsourcing laundry operations.

Know Your True Costs 

Many healthcare organizations do an excellent job of processing linen in-house. But is an on-premise laundry cost effective to operate? Each organization is unique, but to determine how cost effective your laundry operations are, step one is to gather cost data on the following:

  • Labor and benefits (management and hourly),
  • Administrative and overhead costs,
  • Taxes. licenses and permits,
  • Capital expenditures on equipment and machinery,
  • Maintenance and engineering expertise,
  • Chemicals for laundering,
  • Purchase of linens and garments,
  • Utilities (water, electricity, gas), and
  • Insurance.

In some cases, it may be difficult to secure all of this data. But gather what you can. Or begin collecting this data for three to six months. This will give you a good benchmark when comparing outsource options.

Consider, ‘What if?’ The Costs of Space and Insurance

In addition to knowing your costs, consider what your organization might do with the additional space now used by the laundry. Does your organization need more space? Would additional space allow your facility to generate more revenue?

Another “What if,” to consider is the cost of your insurance. Would eliminating the laundry (and any associated risk of fire and employee injury), help reduce insurance costs and workers compensation claims?

Quality, Economies of Scale and Sustainable Operations

Are you happy with the quality of your healthcare linen? Every organization demands good quality linen delivered to floors on time and in the quantities ordered. After all, whether a hospital, clinic or nursing home, you are entrusted with the care of people in your community. It is your job to ensure their comfort and provide linens that are hygienically clean. Key questions to consider:

  • Is your laundry certified or accredited as meeting the highest industry standards for processing healthcare textiles? In an era when fighting MRSA and C-Diff is an ongoing battle, you deserve the peace of mind that all precautions are being taken in processing laundry to keep it hygienically clean.
  • Does your equipment allow consistent quality? Do you operate an ironer, which provides a nice finish?
  • Is your equipment able to efficiently use water, electricity and chemicals for maximum cost savings and to support sustainable (Green) operations? Traditional washers can use as much as 2.5 to 4 gallons of water per pound of linen. In comparison, tunnel washers use less than a gallon of water (.7 gallons). Tunnel washers are made to reuse water, reclaim heat and conserve chemicals. Every healthcare laundry, with sufficient volume, should have one. And that’s the catch. Tunnel washers and other pieces of high-efficiency equipment and processing systems are expensive and only cost effective if your linen volume is large.

The Decision Is Individual

My goal has been to outline key factors to consider when evaluating the cost effectiveness of processing linen in house. Because each organization is different in size and the type of laundry it operates, the decision to outsource is an individual one. Only you can determine if outsourcing linen service is an opportunity to secure cost savings.

Joe Shough is the Director of Business Development for Paris Healthcare Linen Services, a division of Paris Companies. The company serves the Mid-Atlantic region and has healthcare operations in DuBois, Pittsburg and Williamsport, Pa., as well as in Ravenna, Ohio. Shough began his career in the textile services industry on the operations side of the business, working as a supervisor and general manager for a large national company. In 2006, Shough joined Paris Healthcare to manage business development and work closely with the Paris customer service team. He has been involved in adding more than 80 new hospital and nursing home client partners in recent years.

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