How to Optimize Labor Management in Your Organization July 12, 2013

How to Optimize Labor Management
in Your Organization
July 12, 2013
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Healthcare market trends
Consolidation
• Named as biggest healthcare market trend (CEO of Cleveland Clinic)
• 60% of AHA member hospitals are now part of a multiple-hospital system
Focus on Savings
• Healthcare organizations moving from ‘revenue’ mindset to ‘cost’
mindset due to downward pressure on reimbursements
• Need to do better with less = more efficient
HELM Methodology
TM
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Healthcare Enterprise Labor Management
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Logan Pigg – MSHA
• 13 hospitals, serving 29 counties in Tennessee, Virginia,
Kentucky and North Carolina
• Tennessee’s first Magnet® facility - Johnson City Medical
Center 2005, 2009
• 2012 Most Wired Health System
• National Quality Forum’s National Quality Healthcare Award
winner – August 2012
• 1 Union-workforce facility, Norton Community Hospital
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A Case Study
Opportunity:
• National Nursing Shortage; resource mix not appropriate
• Reactive and expensive incentive program
• Silo-approach to managing labor
• Lack of organization communication and resource sharing
• Inability to coordinate resources system-wide
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A Case Study
Opportunity, cont’d.:
• Communications breakdown between Nursing and Finance
• Lack of transparency relative to staffing and productivity
metrics and data
• Productivity and financial data was not timely
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3 Strategies to Better
Manage Labor
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1
Optimize labor resources, including internal
contingency staff, to align with staffing plans
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10
Right-Sized & Layered Float Resources
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Contract Labor FTE Comparison
FY2012
# FTEs
FY2011
FY2010
FY09
140
120
100
80
60
40
20
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Pay Period #
12
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Contingency Labor Cost Trends
Sept 08 – Jul 10
Holding the Gains
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Premium Pay Cost Trends
FY08-FY12 YTD
Open Shift & Bonus
Average Hourly Rates by Skill
FYTD Jan 2012
$10.07
$9.60
$9.20
$7.13
$7.37
$6.07
$4.78 $4.90
$4.77
$4.23
$3.50
$3.31
$2.32 $2.29
RN
LPN
Facility 1
Facility 2
Facility 3
$2.03
$2.31 $2.50
UL
Facility 4
Facility 5
Facility 6
Facility Comparison by Skill Level
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Open Shift Management Tool
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2
Centralized Staffing enables a
coordinated response to needs across
the system
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Sample Enterprise Staffing Analysis
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Sample Enterprise Staffing Analysis
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System-Wide Deployment
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3
Continuously Measure Outcomes
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A Case Study
MSHA implemented:
• Business Intelligence Tools
• Schedule, Financial, and Variance Dashboards
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Sample Financial Dashboard
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Sample Financial Dashboard
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Sample Financial Dashboard
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Sample Variance Dashboard
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Sample Variance Dashboard
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Incidental Worked Time
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Outcomes
• $3.2M savings within first year
• $12M annual savings in contract labor costs
• Increased core staff / reduced reliance on contingency
• Reduced hourly incentives from $20 to $7
• Project expansion to ancillary departments, ED, rehab, and
physician clinics
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Outcomes
• Integrated 24/7 staffing office coordinating activities across
12 hospitals
• Nurse satisfaction scores improved
• Automated business rules at enterprise, hospital, and unit levels
to accommodate facility and department specific rules and
union requirements
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Outcomes
• Productivity and variance-related data is available on a daily
basis
• Actionable data allows nurse managers to adjust staffing on an
hourly, daily, and monthly basis
• Managers struggling with issues related to productivity can be
spotted and mentored
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Recap – 3 Strategies to Better Manage
Labor
1
Optimize labor resources, including internal contingency
staff, to align with staffing plans
2
Centralized Staffing enables a coordinated response to
needs across the system
3
Continuously Measure Outcomes
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Presenter Contact Information
Chris Fox
Logan Pigg
CFox@Avantas.com
402.717.7794
www.avantas.com
PiggLK@msha.com
423.302.3349
www.msha.com
CEO
Avantas
Corporate Dir. Of Finance
MSHA
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Upcoming Events
• Webinar: Topic TBA
– August 13
• Webinar:
Optimizing
Reimbursement –
September 10
• Webinar: Topic TBA
– October 8
• Webinar:
Navigating ACA
Eligibility –
November 12
tnhfma.org/calendar
tnhfma.org/webinars
• Cahaba Road Show
– September 2013
• Fall Institute –
October 23-25, 2013
• TSCPA Healthcare
Conference –
December 2-3, 2013
• Tri-State Institute –
January 22-24, 2014
• Dixie Institute –
February 25-28,
2014
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