In-house and contract services pros and cons

Hospitals across the country depend on environmental services (ES) departments each day to maintain cleanliness, quality and aesthetics, and to help reduce health care-associated infections.
Hospital administrators have several options for who will lead their ES departments, including:

• Hiring an in-house ES management team (e.g., director, manager, assistant managers and supervisors);
• Hiring an ES contract service company under a management fee contract in which only the management team is provided;
• Hiring an ES contract service company under a full-service contract in which the management team and the front-line hourly staff are provided.

Each model has benefits and shortcomings, including the following:

In-house benefits. Among the benefits of an in-house team is a large available pool of experienced ES managers. Moreover, an in-house team likely will have more experience with the patients the hospital serves; the internal customers such as nursing and support services; and local and state regulators.

Additionally, an in-house team will enable the organization to avoid paying a management fee and a markup on supply and equipment costs. In-house teams also experience lower turnover.

Finally, employee development is also a big advantage of in-house teams, because some contract management companies may not support participation in professional societies, and internal management also creates an opportunity for upward mobility for ES staff who have management potential, given mentoring and further education.

In-house shortcomings. In-house teams also have shortcomings. They may demand higher salaries and a more expensive benefit plan, for instance. After numerous years at the same hospital, there also is a risk of complacency. A manager may lose his or her drive to be creative, find ways to improve quality and service, and manage resources effectively. Finally, if an in-house ES manager retires, resigns or is fired, it can be a costly and time-consuming process to hire a solid replacement.

Contract company benefits. Among the benefits of contract service companies are professionally trained management personnel and an available talent pool. Additionally, contract employees come with proven systems, policies, training, chemicals and new equipment. They also come with corporate support and start-up team support and provide guaranteed cost and quality.

Contract company shortcomings. Of course, contract service companies also have shortcomings, such as less experienced managers and higher turnover. Moreover, a contract company sales representative may lowball a bid to obtain the contract and then fail to deliver. Additionally, a hospital could end up tied to a contract for several years.

Ultimately, whichever direction is pursued, it is essential to conduct thorough background and reference checks, and include key stakeholders in the decision.

By Carl Solomon Sr., CHESP, director of hospitality services at UCSF Medical Center/Benioff Children's Hospital, San Francisco, and a former contract ES management company employee.

AHE insight

Valuable resources available

AHE represents, defines and advances the professionals responsible for care of the health care environment to ensure high-quality outcomes and healthy communities. Here are a few of the resources that AHE offers.

• Recommended Practice Series: Environmental Services Equipment and Supplies. The equipment and supplies covered in this booklet are essential, discrete components of safe, efficient and productive environmental services (ES) operations. For more information, go to www.ahe.org/ahe/learn/tools_and_resources/publications.shtml.

• Expanding Your Influence in Today's Healthcare Environment. What skills must you develop to expand your influence and position ES as a department to be reckoned with? This prerecorded webinar explores effective communication skills and how emotional intelligence can be leveraged to influence others. To access it, log on to www.ahe.org/education.

• AHE Environmental Sustainability Certificate Program. AHE has launched a new certificate program to acknowledge the ongoing and outstanding environment and ecological sustainability efforts of ES departments. For more information on the program, go to www.ahe.org/ahe/lead/environmental_sustainability_certificate_program.shtml.