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WRX Launches Hospital Labor Waste Calculator
Date:4/16/2009

(Hospitals target the disease, not the symptoms)

HUDSON, Fla., April 16 /PRNewswire/ -- Workforce Prescriptions ("WRX") announced on Friday the launch of a no-cost online tool developed to allow hospitals to estimate their unique labor waste derived from 7 sources:

  • Overtime utilization
  • Agency utilization
  • Other "Premium Pay" utilization
  • Excessive length of stay driven by avoidable days
  • Process labor waste
  • Productivity labor waste
  • General labor waste

"The tool was developed by analyzing data provided by over 140 adult acute hospitals who have participated in detailed labor efficiency audits over the last 3 years," states Dean Kristiniak, Vice President of Key Service Lines. He goes on to state, "It took some work to clarify linkages in order to distinguish between root causes and correlating factors in order to produce reasonably accurate estimates based on just a few key data points."

"Our goal in providing this tool to the marketplace is to elevate the discussion of alternatives to traditional methods of reducing labor expense. We'd like to move the industry past conversations of FTE (full time employee) or workforce reductions into conversations about the practices and processes that are at the root of unnecessary labor dependence and ultimately labor waste," states Charlie Dawson, President. He continues, "While we know that this tool produces only a remedial analysis of cause & effect, we've discovered it provides a valuable touch-point for senior leadership teams wanting to explore alternatives to optimizing labor without reducing staff."

WRX speaks and writes frequently about a single paradigm, "To assume that the most effective manner of reducing labor expense is to reduce the availability of labor" is to consciously choose to jeopardize:

  • employee engagement
  • workforce flexibility
  • & physician willingness to refer

"When you lower employee engagement, lower access to labor, reduce workforce flexibility and risk the revenue that physician referrals represent, you have just created the perfect storm for yourself," states Keith Bush, CIO/Vice President of Analytics.

WRX audits illustrate that any financial benefit derived from a reduction in staff is nearly always lost over the following 30 months. Data further validates that RIF's (reduction in force) can engender circumstances where higher paid staff are required to assume the duties of downsized lower paid staff resulting in a raised cost-per-hour of labor within the organization. "Over time, this creates the opposite result of what was intended," states Mr. Dawson. "We now see hospitals paying a $25-40/hr RN to complete the tasks that were previously provided by an $8-12/hr unit secretary. Not only does this take the RN out of direct patient care for a larger amount of time, but it requires that the organization find a way to back-fill the clinical expertise the RN can no longer provide."

John Delaney, Sr. VP of Client services comments, "We have all heard the mantra: No money - no mission, but we'd like healthcare to begin embracing some of the core productivity, process and business competencies that have become the cornerstone of bottom line performance in other industries. In a market rife with staff shortages, access to labor (having enough of the right kind of staff at the right time) must be preserved."

"In the final tally, healthcare isn't like a manufacturing business and patients can't be managed like an assembly line. The only product involved is the productive labor of staff (and staffing benchmarks don't tell that part of the story). What our industry struggles with is identifying the work processes, automation levels or unique operational pressures that drive human behavior and force labor waste," states Mr. Kristiniak. "We are hoping this tool is able to provide a low-touch/high impact insight into some of these mitigating factors to enable more robust decision making, so that as an industry, we can target the disease and not just the symptoms."

The tool can be found at: http://www.workforcerx.org/recaptureCalculator.php

About Workforce Prescriptions

Workforce Prescriptions is an "evidence based" consulting firm headquartered in Hudson, FL that provides assistance to hospitals desiring to: enhance revenues, reduce their cost of labor & length of stay or to improve their work practices/processes. Workforce Prescriptions focuses primarily in the not-for-profit sector of healthcare in order to "assist those organizations whose own mission requires them to take extraordinary risks in order to ensure access to quality healthcare for the neediest of American's."


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SOURCE Workforce Prescriptions
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