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Getting the Numbers Right

January 31, 2011
by Mark Hagland
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CIOs Find the Use of HR and Staffing Solutions Pays Major Dividends

EXECUTIVE SUMMARY

CIOs, CEOs, and other senior executives in hospital organizations are pursuing a number of approaches to leverage clinical and other key data in order to analyze staffing needs, and are working to optimize staffing, as they address the single biggest operating cost for most hospitals: labor.

On the surface, it should seem obvious: since labor costs are the largest single operating expense for the vast majority of U.S. hospitals, and the complexities of scheduling are so often daunting, leveraging IT to optimize staffing should seem like a no-brainer choice, right? Perhaps, but, as in other areas of hospital and health system management, it's only been in recent years that CIOs have gotten heavily involved in helping chief nursing officers, HR professionals, and others to optimize staffing levels, as costs for such groups as agency nurses have gone through the roof.

In fact, CIOs, CEOs, and other C-suite executives are moving increasingly to analyze their constantly fluctuating staffing needs, and to be able to staff up-or down-with a far greater level of precision in the past. And that's actually where the journey begins with many organizations-just getting a handle on staffing levels to begin with.

Michael Poore
Michael Poore

That certainly was the case for Michael Poore, president and CEO at MedWest Health System, a three-hospital system based in Clyde, N.C. that includes 189-bed Haywood Regional Medical Center, 86-bed Harris Regional Hospital, and a 25-bed critical access hospital, Swain County Hospital. “Our FTEs per adjusted occupied bed were pretty high as a system, but we didn't have a lot of idea of where we were overstaffed or not,” Poore says. “And we had no internal resources with which to do a productivity study within our hospital. In his organization's case, what made sense was to turn to the combined IT solution and consulting services of the Charlotte-based Premier, the nationwide hospital alliance.

Stephen M. Stewart
Stephen M. Stewart

“They helped us implement the Operations Advisor tool, so we could develop the benchmarks to help us decide where to flex our staffing or look at our levels,” Poore says. “I never ask a manager to do something unless I can give them the tools to do it. And I recognized that our managers didn't have the tools to manage our productivity; we didn't even know what our productivity was.” All staffing areas were involved, both clinical and non-clinical, from environmental services to engineering, to nursing, he notes, adding that, “We were able to benchmark ourselves against similar hospitals with similar patient volumes.”

OUR FULL-TIME EMPLOYEES PER ADJUSTED OCCUPIED BED WERE PRETTY HIGH AS A SYSTEM, BUT WE DIDN'T HAVE A LOT OF IDEA OF WHERE WE WERE OVERSTAFFED OR NOT.-MICHAEL POORE

What was learned? “We found out that we were overstaffed in a lot of areas, and that the way our processes were set up didn't allow us to manage that on a real-time basis,” Poore says. For example, he and his colleagues discovered that the number of FTEs in the flagship hospital's emergency department was very high in relation to the number of patients being seen on a daily basis, but that Heywood didn't have the mechanisms in place to adjust staffing precisely enough on a daily basis. So Poore and his colleagues went to work in a number of areas, including the ED, to get truly granular and use data to pinpoint staffing needs, in order to avert cycles of hiring and layoffs that so commonly afflict hospital organizations, as well as to avert the classic situation in which nursing goes through periods of understaffing, putting undue burdens on floor nurses and leading to stress and burnout.

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