Hospital staffing automation can help you meet budget goals.

Last week I spoke at the NACHR Conference in Seattle on the benefits of automating your hospital staffing process.  Here are the notes from that talk.

Almost everyone I speak with thinks healthcare is immune to economic downturns.  Any of us working in the healthcare staffing industry know otherwise.  Like almost every other sector of the economy, healthcare too is suffering from the financial crisis.  The down economy has forced hospitals and health systems to tighten their budgets and there are few, if any, signs indicating near term improvement.

Some of the major factors impacting hospital budgets include bad debt, increased costs for providing care, state budget cuts, lower reimbursements and treating an increasing amount of uninsured consumers.  These factors have many hospitals across the country cutting their budgets, some hospitals are cutting their budgets by tens of millions of dollars in order to meet their fiscal goals. 

One of the main areas at which hospitals are looking to make most of their cuts is in labor costs.  Typically accounting for 60-70% of a hospital budget, labor costs can increase dramatically and without warning due to overtime, shift bonuses, on-call and other incentive pay.   However, making labor cuts is difficult because hospital workloads have not decreased.  On July 6, the American Nurses Association (ANA) published results of a recently completed survey where 70% of the 14,000 plus respondents stated that current hospital staffing is insufficient.  The combination of all these factors is creating a nightmare scenario for many hospitals and their employees.

But there is hope.  Several solutions exist to help hospitals navigate these negative financial waters.  Perhaps the best way for hospitals to better manage their budgets, improve efficiencies and increase the productivity of their staff is by automating their staffing processes.

Today’s Staffing Challenges:
Hospitals constantly face new challenges when it comes to staffing, especially if they have a manual staffing process. Today, many hospitals are dealing with:

• A multi-generational workforce with a wide variance in motivators and objectives in their career, as well as different attitudes in their approach to their daily work routines.
• Increased overtime costs as they deal with staff shortages and hiring freezes, requiring their existing staff to work more and suffer from burn out. 
• Tighter budgets due to cost cutting measures, lower census and reimbursements, caring for uninsured patients, state budget cuts and higher costs related to patient care.
• Unpredictable variances in staffing levels and patient acuity.
• Ineffective ways of properly utilizing temporary healthcare staff.  Many hospitals still view working with healthcare staffing suppliers as a last minute, necessary evil instead of approaching it as a partnership that can produce many benefits. Partnering with the right healthcare staffing suppliers and implementing an effective healthcare vendor management strategy can ensure you are adequately staffed and save you money. 
• Compliance. Compliance. Compliance.  Compliance – has and always will be a daunting task for hospitals to keep up with.  Doing so adequately can be time consuming and costly.

Meet the challenge:
The best way to meet these challenges is to automate your staffing process and implement software applications that will make your life much easier.  By automating your staffing process you can face and overcome all of these challenges while increasing the productivity of your existing staff.  Effective staffing automation tools can help you:

• Create a flexible, open scheduling environment that affords your staff more freedom when it comes to their schedule.  This helps improve morale and cut down on the amount of time it takes to create multiple staff schedules.
• Match your most qualified, cost effective caregiver to every assignment.  Automation tools enable you to ensure your staff are properly credentialed for each assignment.  In addition, they help you review pay differentials and identify any outliers, such as employees making disproportionally more by working extra shifts or too much overtime, as well as bonuses offerings that may be outdated.
• Eliminate unnecessary overtime and rationalize it when it's cost effective.  For example, there are times when it may make sense to approve overtime in clinical areas that typically generate revenue for your hospital by keeping beds filled.  Additionally, automation tools enable you to easily build rules that will alert you when a scheduling decision would put someone into overtime or even disallow it without authorized pre-approval. 
• Meet your safe staffing goals by ensuring adequate staffing levels and better staff to patient ratios by quickly reviewing reports or dashboard data summaries. 
• Successfully manage multiple staff pools as easy as managing one.  Automation tools give you a complete view into all available core and contingent staff.  Such oversight helps ensure your internal resource pool staff is put to its highest and best use - supporting areas of high demand rather than filling routine shifts that core staff can work.  In addition, creating an effective strategy for using healthcare agency staff ensures you get the best return on investment for all of your staffing decisions. 
• Receive real time data, alerts and visual triggers to assist you in your fast pace daily routines.  Being alerted instantly for overtime, cancellations or approvals can save you money by enabling you to quickly take action or avoiding mistakes.
• Achieve budgetary goals.  Automation allows you to track expenses. By tracking things like pay codes, you might find that scheduling additional staff, even temporary staff, can actually save you money over putting multiple people on call or pushing core staff into overtime. 
• Guarantee compliance.  Automation tools help reduce the human error factor inherent in a manual process.  People get busy and when they do they tend to get sloppy.  Reading through piles of paper and faxes, and combing through spreadsheets for hours will inevitably produce errors.  Staffing rules that disallow scheduling for lack of proper documentation, active credentials, scheduling conflicts and overtime can easily be created to ensure you stay compliant.
• Better understand your staffing needs and staffing levels.  Your staffing data will help you recognize your total staffing needs and enable you to staff strategically instead of reactively. 
• Measure employee performance and identify areas that need improvement as well as those that are working.
• Integrate data sources for seamless work flows. If you can’t track it – you can’t manage it.  Most applications now have API's that will allow you to import/export data to/from other systems.  The more your data is integrated the easier it is to track and improve your processes.

Conclusion
Most hospitals today are facing similar situations and have the same goals.  With the state of the current economy it’s difficult to cover your costs and manage your workloads.  It makes sense to look at your labor costs first.  However, making labor cuts without first attempting to optimize the productivity of your current workforce could end up being unnecessary and much more costly in the long run.  The demand for healthcare professionals will return and cutting staff without proper analysis could hurt you in more ways than one.  By automating your staffing process you will see an instant return on investment that will continue paying off long after this economic crisis is over. 

Comments

[Jeff Long]

These are good points Jason, my concern is that it seems like getting some of these things in place during a downtime could be difficult as everyone is suddenly doing double duty and dealing with the new work environment. These are things that I would think need addressed in good times to prepare for the storm that always seems to go in 5-6 year cycles to varying degrees. What have you seen?

[Jason Lander]

You bring up an excellent point Jeff. I'm sure some hospitals have higher priorities and this solution may not make sense across the board.

However, at ShiftWise for example, we find that most hospitals choose to implement automation tools during down times so that when things pick back up and scheduling becomes even more difficult - they're ready to go.

I think another good reason to act now is because hospitals are looking to make cuts. Specifically, labor cuts. This will only exacerbate the current situation. Therefore, my advice for hospitals is to at least consider automating their processes prior to making sweeping cuts. Automation can save hospitals 100's of thousands if not millions of dollars, potentially making labor cuts unnecessary.

Example: http://www.shiftwise.net/Customers/CaseStudies.html