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Staffing and Productivity. Goals to understand some of the key terms in workload management Know the relationship between staffing, and scheduling Understand the meaning of productivity in health care organizations Develop and describe commonly used productivity ratios. Workload Management.

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staffing and productivity
Staffing and Productivity
  • Goals
    • to understand some of the key terms in workload management
    • Know the relationship between staffing, and scheduling
    • Understand the meaning of productivity in health care organizations
    • Develop and describe commonly used productivity ratios
workload management
Workload Management




Staff Utilization

Patient Satisfaction


Staff Satisfaction


workload management3
Workload Management
  • Staffing
    • Decide on the appropriate number of full time employees to be hired in each skill class
    • Longer term– tactical
  • Scheduling
    • Establishes when each staff will be on or off duty and on which shifts they will work
    • Often per pay period
  • Reallocation
    • Fine tunes the previous decisions. Shift-by-shift decisions.
staffing setting standards
Staffing:Setting Standards
  • Why are workload standards important?
    • Labor costs can represent 40 percent or more of a hospital's budget.
    • Thus vital only to hire only the necessary staff
    • Also must maintain high quality care
    • Pay attention to patient and staff satisfaction
hca operating costs 11 billion in salary wages and benefits


Operating Costs


All Other Operating



Supply Expense

(in Billions)


Shared Services






makes up

makes up

makes up






of Total


Salaries, Wages



& Benefits




Operating Expense





HCA Operating Costs $11 Billion in Salary, Wages and Benefits
establishing standards
Establishing Standards
  • Work standard – the predetermined allocation of time available for a unit of service to maintain an appropriate level of quality
  • The unit of service varies – could be measured as patient days or procedural
establishing standards7
Establishing Standards
  • Historically Standards were based on overall census of the facility.
    • Easy to calculate
    • Misses much variation across departments
  • Today there are more sophisticated techniques which are calculated at the department level and adjust for the acuity of the patient.
  • Steps
    • Establish patient classification and acuity system
    • Develop time standards to reflect the time necessary to care for each patient using the classification system
    • Convert total coverage needed into appropriate number of full-time equivalents (FTE).
patient acuity systems
Patient Acuity Systems
  • Hospitals rely on departmental acuity adjusted census to establish work standards
    • More accurate
      • An 85 year old man in ICU vs. minor surgical procedure
    • Population entering hospital is sicker today than 10 years ago. Trend likely to continue
    • Coupled with decreased reimbursement and increased emphasis on cost control
    • Requires more fine tuning to maintain quality
patient acuity systems9
Patient Acuity Systems
  • Patient Acuity Systems or Patient classification systems are used routinely in Nursing
    • Joint Commission Standard
      • “Define, implement, and maintain a system for determining patient requirements for nursing care on the basis of demonstrated patient needs, appropriate nursing intervention, and priority for care.”
patient acuity systems10
Patient Acuity Systems
  • Two types of systems
    • Prototype.
      • These classify patients into the type of care needed.
      • Patients grouped into one of up to ten levels based on expected nursing time commitments, diagnosis, mobility, medications and education needed.
      • Simple to do but highly subjective
    • Factor Analysis
      • More complicated statistical analysis
      • Looks at all possible determinants and assigns them to groups and gives the groups weights
workload standards
Workload Standards
  • Once acuity is measured, we then convert to time level required and then needed FTEs
  • First step is a careful identification and documentation of activities in the department
    • Flow and process charts
    • Fixed and variable activities
  • Second step is assessing time required to perform tasks
    • Estimate
    • Historical averages (aggregate level)
    • Logging
  • Adjust for utilization
    • Utilization rate is generally not 100%
      • Controllable – vacation, avoidable delays, etc.
      • Uncontrollable -- sick leave, physicians, etc.
some examples
Some Examples
  • See Staffing Examples Spreadsheet
determination of ftes for nurse staffing
Determination of FTEs for Nurse Staffing
  • Minutes of required care

Minutes of care = (average census) * (average required minutes per patient)

  • Unadjusted FTEs

Unadjusted FTEs = (Total minutes of care)/(Minutes available to work per nurse per day)

  • Core Level FTEs

Core Level FTEs = (Total Minutes of Care)/(utilization standard)*Available work minutes)

See example on Excel Spreadsheet

  • Here we want to understand the meaning of productivity in the context of healthcare
  • How do we measure?
  • problems with measuring
  • Relationship between productivity and quality
  • Some examples
definitions and measurements
Definitions and Measurements
  • In its simplest form productivity is defined as output over input:
  • Alternatively Hours Per Patient Day:
  • Or in the outpatient setting:
definitions and measurements16
Definitions and Measurements
  • Nurses in unit A worked a total of 25 hours to a treat a patient who stayed five days. Nurses in unit B worked 16 hours to treat a patient who stayed four days. Which unit is more productive?
  • Productivity is a relative measure
  • Compare to similar unit or the same unit over time
  • These comparisons over time are referred to as historical benchmarking
  • Alternatively best practices across organizations can be established and the unit’s numbers are compared to these
  • On a day-to-day level, departments are compared to what is budgeted
what about outpatients how are they counted
What about outpatients? How are they counted?
  • Using Gross Revenue as a proxy indicator for facility output, the Outpatient Factor is calculated to adjust for this
  • So adding 27% more to inpatient volume will account for the outpatient activity

Outpatient Revenue = $3,020,000

Inpatient Revenue = + $11,185,200

Total Patient Revenue= $14,205,200


terminology concepts
Terminology & Concepts

How is productivity measured at the hospital level?

    • EEOB = Equivalent Employees per adjusted Occupied Bed
    • Use of AADC reflects length of stay (LOS)
    • Also referred to as “FTEs per AADC”, EPOB
  • EEOB =

Paid FTEs


Can use either Paid or Prod

terminology concepts21
Terminology & Concepts

How is productivity measured at the hospital level?

  • MH/AA= Man Hours per Adjusted Admission
    • MH/AA=
    • To convert FTEs into Manhours, multiply FTEs

by the number of hours in the time period of study

Can use either Paid or Prod

Total Manhours

Adj Adm

terminology concepts22
Terminology & Concepts

How is productivity measured at the hospital level?

  • SWB/AA = Salaries, Wages & Benefits per Adjusted Admission
  • SWB/APD = Salaries, Wages & Benefits per Adjusted Patient Day
    • SWB/AA=
    • SWB/APD=
    • Expressed in terms of dollars instead of hours

SWB (in $)

Adj Adm

SWB (in $)

Adj Pt Day

case mix and quality
Case Mix and Quality
  • Previous examples assumed:
    • Homogeneous outputs
    • Constant quality
  • In practice outputs and inputs are hard to measure
    • Two nursing units with the same staffing levels each treat thirty patients in a day. Equally productive?
    • Suppose one unit is ICU, the other med/surg. Clearly ICU is more productive given numbers above once we account for case mix.
    • Even if case mix were constant, one unit may be providing better quality.
  • Thus in theory productivity measures should account for both case mix and quality (although historical quality has been largely ignored --- until now)
adjustments for inputs
Adjustments for Inputs
  • Skill Mix Adjustment
    • We can use the wage (or salary) to weigh the hours of personnel of different skill levels.
    • Suppose RNs = $35, LPN=$28, Aides =$17.5
      • WRN=35/35=1
      • WLPN=25/35=0.8
      • Waide=17.5/35=0.5
    • That is one hour of an aide’s time is worth a half hour of RN time.
adjustments for inputs25
Adjustments for inputs
  • Adjusted hours:
    • Where Wi = the weight for skill level i
    • Xi is the hours worked by skill level i
  • Adjusted hours per patient day:
  • Given the weights above (RN=1, LPN=.8, Aide=.5), calculate the adjusted hours per patient day for unit A and B
  • Adjusted HoursB= 1(180,000 x .45) + .8(180,000 x .35) + .5(180,000 x .25) = 146,700
  • Adjusted Hours Per Patient Day:
    • Unit A: = 210,000/14,000 = 15.0 Hours
    • Unit B: = 146,700/10,000 = 14.7 Hours
  • Note that if we used unadjusted HPPD we would reach the opposite conclusion
adjustment for inputs
Adjustment for Inputs
  • Standardized Cost of labor
  • Alternatively we can construct the numerator using the total costs of labor
    • Labor Cost = Σcixi
      • Ci=the wage for skill level i
      • Xi is the hours worked for skill level i
  • SWB/AA and SWB/APD
adjustments for outputs
Adjustments for Outputs
  • The above measures do not consider case mix, so they are useful primarily when comparing similar patients in similar settings or for use in a departmental budget, but not across specialties or hospital types.
  • Patient classification systems categorize patients daily into several categories of acuity.
  • This allows the construction of a case mix index:

where Pij= percent of patients for acuity category i in unit j, and Wi is the weight for the ith acuity category

unit of service uos
Unit of Service (UOS)

A quantity by which workload can be measured— aka Statistic

units of service
Units of Service
  • Nursing Departments Patient and Observation Days
  • Dialysis Treatment Center Dialysis Treatments
  • Respiratory Therapy Relative Value Units
  • Delivery Room Deliveries
  • Operating Room Minutes of Surgery
  • Outpatient Surgery Visits
  • OR Sterile Processing Minutes of Surgery
  • Cath Lab Billed Procedures
  • Post Anesthesia Care Minutes of Recovery
  • Emergency Department Visits
  • Endoscopy Billed Procedures
  • Laboratory Billed Tests
  • Non-invasive Cardiology Billed Procedures
  • Vascular Lab Billed Procedures
  • TOTAL IMAGING Billed Procedures
  • Cancer Treatment Center Billed Procedures
  • Pharmacy Billed Doses
  • Physical Rehab Relative Value Units
units of service34
Units of Service
  • Administration General Total Patient and Observation Days
  • Nursing Administration Total Patient and Observation Days
  • Case Management Total Patient and Observation Days
  • In-service Education Total Patient and Observation Days
  • Plant Ops & Maintenance Total Patient and Observation Days
  • Biomedical Engineering Total Patient and Observation Days
  • Security Services Total Patient and Observation Days
  • General Accounting Total Patient and Observation Days
  • Business Development/Marketing Total Patient and Observation Days
  • Infection Control Total Patient and Observation Days
  • Quality Management Total Patient and Observation Days
  • Housekeeping Cleanable Square Footage
  • Transportation Services Adjusted Patient Days
  • Central Supply/Materials Management Adjusted Patient Days
  • Community Health/Outreach Adjusted Patient Days
  • Administration Medical Staff Adjusted Patient Days
  • Information Services Adjusted Patient Days
  • Communications/PBX Adjusted Patient Days
  • Research Clinical Trials Adjusted Patient Days
units of service35
Units of Service
  • Admitting & Registration Registrations
  • Medical Records Registrations
  • Dietary Services Meal Equivalents
  • Pastoral Care Calendar Days
  • Volunteers Calendar Days
  • Human Resources/Employee Benefits Employed FTEs
  • Patient Accounting Accounts Open/Worked
  • Transcription Lines Transcribed

Daily Productivity Trend

  • Worked Hours: Hours expended to carry on operations
  • Worked / Productive Hours = Regular + Overtime + Contract
  • Paid Hours: All hours expended in a department
  • Paid Hours = Regular + Overtime + Contract + Orientation + Education + PTO + Holiday
  • Contract: Per Diem or Contract Agency
  • Overtime: Hours paid at time and a half
  • Orientation: Hours used for orientation
hours cont
Hours (cont.)
  • Productive Hours = Worked hours or hours expended that contribute to operations
  • Non-Productive Hours = Hours expended that do not contribute to operations
  • Non-Productive = Orientation + Education + PTO + Holiday
  • Paid Hours = All hours previously described
  • Application:

If a department has 500 regular hours, 100 overtime hours, 100 contract hours, 100 orientation hours, 100 PTO hours and 100 continuing ed. hours,

How many are worked hours?

How many are non-productive hours?

How many are paid hours?



Review the various metrics on the Labor Variance Rpt

worked manhours per stat
Worked Manhours per Stat

Daily Labor Variance Report

Number of Worked Hours per Statistic—aka Worked Hours Per UOS / Stat

worked hours per stat
Worked Hours per Stat
  • Worked Hours per Stat =

Total Worked Hours/Total Units of Service

  • Application:

If a department has 1000 Worked Hours with a total of 100 Patient Days, what is the Worked Hours per Stat?

If a department has a Worked Hours per Stat budget of 10.00 with a total of 10 Patients, how many Staffing Hours does the department have?

paid manhours per stat
Paid Manhours per Stat

Number of Paid Hours per Statistic—aka Manhours Per UOS / Stat

OT %

% of Total Paid Hours that are Overtime

Contract %

% of Total Paid Hours that are Contract

salaries per unit of service
Salaries per Unit of Service

Total Salary Cost per Unit of Service—aka Salary Cost Per UOS / Stat

salary cost per uos
Salary Cost per UOS
  • Salary Cost per UOS =

Total Salary Cost/Total Units of Service

If a department has $100,000 in Salary Cost with a total of 1000 Patient Days, what is the Salary Cost per UOS?

budget information
Budget Information

The budget sets the standard

salary wage variance to target
Salary & Wage Variance to Target

Month-to-Date Salary Cost Variance

unfavorable variance
Unfavorable $ Variance

Departments with Negative Salary Variances

variance from budget
% Variance from Budget

% of Salary Cost Variance from Budget

prior week salary wage variance to target
Prior Week: Salary & Wage Variance to Target

Prior Week: Month-to-Date Salary Cost Variance

prior week variance from budget
Prior Week: % Variance from Budget

Prior Week: % of Salary Cost Variance from Budget

daily productivity trend
Daily Productivity Trend
  • Focused mainly on the management of actual hours
    • Worked Hours
    • Paid Hours
    • Agency Hours
  • Provides trended view of hours used during a given pay period
  • Allows one to see improvements or failures in labor resource management from day to day
daily productivity trend55
Daily Productivity Trend

UOS (Unit of Service)

Worked Hrs

Paid Hrs

Salary Cost Per Stat

Avgas Hrly Rate

Agency / Contract Hrs & %

Overtime Hrs & %

Orientation Hrs & %


Daily Productivity Trend

  • Totals hours used for Pay Period
  • Total hours used in prior Pay Period
  • Total hours used month to date