Simple workforce strategies to save costs
April 13, 2017
I have written a lot about the need for healthcare organizations to approach workforce management in new ways. Value-based payment models, ever-changing regulations and the ongoing need to stay focused on cost containment across the organization all lead us to look at our crucial staffing practices.
I generally offer a 10,000-foot view of workforce management and I encourage and support a long-term cultural shift to a patient centered strategy. However, I also work with healthcare organizations large and small, every day, to help them find simple and straightforward ways to save costs, now. Here is what I’ve found.
It’s time to standardize processes and information across systems.
A health system CEO I recently talked to said he is seeing more efficiencies across his system’s supply chain, but not across his staffing practices and labor costs. He really wants to provide the tools to his managers to find the root causes of rising costs and to fix them, long term. That means more than downsizing staff, which may look good to the finance department, but can show up in lower HCAHPS patient satisfaction surveys and hurt value-based payments.
This is where automation and a single source of truth come in. While healthcare organizations have been moving toward automation for the past two decades, that move tends to focus on traditional processes such as time cards, payroll, shift scheduling and generating reports retroactively. Systems aren’t using that automation to identify or predict areas for improvement. Information is still in silos in different departments and, in this era of mergers and acquisitions, may vary widely across facilities within the same health system.
Let’s tackle overtime.
Staff overtime has always been a challenge for healthcare organizations. For employees who punch a clock, a one-minute difference in when they punch out can cost millions of dollars. One common issue is gaming at the clock. For example, I was working with a small community hospital looking to save labor costs. One of the things we did is graph all out-punches for a year. Using quarter hour rounding, employees had seven minutes after the end of their shifts to clock out. We found that many employees were punching the clock eight minutes after their shift, which rounded to the next quarter hour. That extra minute doesn’t sound like a big deal, until you do the math: If employees have a quarter hour round-up once per week and you multiply that by 2,500 employees in a system, it can equal 32,500 hours of overtime per year. That adds up to millions of dollars. With Infor Workforce Management, you can create criteria and alerts around overtime to keep it in check.
Who’s working through lunch?
It’s not uncommon for clinical units to be so busy that staff members can’t take their allotted 30 minutes for lunch. This is also a place where costs can add up. For example, if an employee works 8 to 5:30, the existing system takes the 30 minutes out for lunch. But when an employee cancels out that lunch and gets paid an extra half hour that could convert to overtime. I recently had a client who took a careful look at this issue. We made a list of the top 20 employees based on cancelled meals, with one employee topping out at 506 cancelled meal deducts in a single year. Overall, this cost the organization $70,000+.
Now that the information is automated in Infor’s Workforce Management system, the organization has the data and analytics to create a balanced workload and approach its finance department and ask for additional staff to help it avoid overtime and missed lunches. As my colleague Danielle Miller, Infor’s Chief Nursing Officer, likes to say, “Finance doesn’t talk clinical. Clinical doesn’t talk finance. But both talk data.”
In the end, saving costs is all about having the right information, in the right place. The future of healthcare and system sustainability depends on it. What are you doing to save costs in your organization, today? To find out more about what Danielle and I have to say on this topic, feel free to listen to our webinar: “Practical strategies for managing the workforce.”
Alan Bateman, Industry Strategy Director, Infor Healthcare
- North America