The management of labor in the hospital environment is a process that truly requires day-to-day oversight by the hospital leadership team. Salary, wages and benefits are the most significant operating expenses for a hospital trying to improve financial performance. CHC Consulting’s approach for productivity, customized for rural and community hospitals, brings just what’s needed to make staffing effective for quality care delivery.
There is no question that hospitals are challenged with increasing costs and tighter margins. The goal of productivity is to ensure each hospital department has the right level of staffing to provide quality care. By establishing a productivity budget and then staffing to a budget number, the hospital can deliver excellent patient care while reducing costs and increasing efficiency.
How to Implement Productivity Management
One of the most important aspects of productivity implementation is involving the right people from the beginning. Participants should include community hospital executives and front-line departmental managers. The role of the executive team is to set financial targets for each department that roll up to the top-line hospital budget. The department managers then become involved to determine the level of staffing needed to meet these targets. During this process, department managers need education about the reasons for and benefits of productivity management.
The staffing targets are established based on both internal historical data and industry benchmarks. Each hospital department uses specific utilization metrics to determine the staffing levels needed. Examples of utilization statistics include patient days, lab tests or surgical procedures. After the optimal ratio of hours worked to the utilization statistic is defined, the departmental manager tracks departmental volumes and schedules staff based on current and predicted volumes. In cases where the department begins to be more or less busy than projected, the manager will adjust staffing to keep the productivity ratio in check.