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Staffing to demand: Combating volatility in healthcare

March 13, 2024 Article 4 min read
Kiran Kaur
Matching your staffing levels to patient demand is an important factor in controlling costs at your healthcare organization. Consider these four ways to better manage labor costs.
Healthcare staff collaborate and talk on strategy before surgery.The healthcare industry has experienced wave after wave of change and disruption over the last several years, leaving leaders with several issues to contend with, including staffing shortages and rising costs. With labor costs representing an upwards of 55% of total expenses in an acute care environment (American Hospital Association), it’s become more essential than ever to right-size staffing according to volume to control expenses and combat instability. This is forcing healthcare leaders to ask, “What can I do to ensure that I’m staffing appropriately to meet demand?”

While the answer isn’t so simple, benchmarking, measuring, and tracking labor productivity across all departments of your hospital are key to gathering the information necessary for controlling labor costs. Consider these four ways to get a stronger handle on costs and improve the sustainability and resilience of your organization.

1. Measuring labor productivity

Labor productivity is about getting the most out of every labor hour worked. Measuring labor productivity at a department level allows hospital leadership to pinpoint which areas of the organization are performing to benchmark and which indicate opportunity for improvement compared to like-hospitals across the industry. It serves as a gauge on production compared to present workload, which can guide managers to make data-driven staffing decisions that ensure your teams stay fully productive.

Table depicting cost centers, hours worked per procedure, and FTEs.

When numbers deviate from benchmark, leaders should be thinking of their departments with a small business owner mindset and asking themselves what tools do they have to improve productivity in staffing?

Using the information collected from a labor productivity benchmarking analysis drives conversation on key levers that managers have within their control to impact their productivity performance. Keep these in mind when aligning staffing to demand:

  • Are you monitoring labor productivity and comparing results with benchmarks?
  • Do departments stagger staff schedules to align with workload?
  • Are your hours of operation in sync with patient demand?
  • Is the department prioritizing volume growth such as increasing number of patient slots?
  • Is the check-in process streamlined?
  • What is the department doing to reduce the number of patient no-shows?

Is your hospital meeting key labor productivity benchmarks? 

2. Scheduling to volume

Are your staff shifts scheduled in a way that ensures they will be fully productive each shift? Is there significant idle time baked into the schedule? The volume of patients a department sees will fluctuate throughout the day, with certain hours being busier than others. Monitoring patterns in this fluctuation is a great way to ensure your team isn’t overstaffed during a period where patient volume is low or understaffed during peak volume times. Reviewing data such as the ED patient arrival curve data for staffing the emergency department, for example, is one way health systems can appropriately staff departments while also mitigating patient boarding. Similarly, syncing your hours of operation with patient demand will allow staff to stay productive and see patients when there is a need. Extending or shortening hours of operation will allow you to better provide care to patients while also staffing to proper demand. Once hours of operations are in alignment with demand, your departments can also implement staggered staff schedules. This will provide better coverage during high volume hours as well as reduce staffing issues. Staggered shifts allow for overlap in staff schedules, making the hand-off of work much smoother and quicker.

3. Operational efficiencies

Convoluted operational processes can cause barriers to productivity, including staffing challenges, financial concerns, and even a dip in the volume of patients that can be seen during the day. Working to optimize administrative and clinical operational processes through sustainable transformation efforts ensures that your organization can withstand the volatility the industry is facing today. When thinking about operational efficiencies, consider these questions:

  • Are your departments doing everything they can to grow patient volume such as increasing the number of patient slots available?
  • Are the check-in/check-out processes streamlined?
  • Are all administrative and clinical processes as streamlined and efficient as possible?

Taking a closer look at your day-to-day operational processes will allow you to improve outcomes and address any obstacles you face with staffing and patient volumes.

4. Increasing volume

What can you do when a department still needs to align to demand but doesn’t want to reduce staffing levels? The solution lies within increasing your patient volumes. Consider improvements such as online self-scheduling features to streamline the check-in process. The ease of scheduling promotes patient engagement, keeps patients within your organization, and prevents them from turning to more mobile-friendly health systems.

To go a step further, your departments can also introduce text reminders for appointments and implement stronger policies regarding patient no-shows and cancellations to reduce loss of appointment slots. Making a few actionable changes will go a long way in growing volume and retaining your patient population.

Benefits of aligning staffing to demand

While the primary benefit of staffing to demand is improved cost control, collecting necessary information can help you spot additional issues unknown to leadership, identify opportunities for improvement, and compare your performance to other organizations. If the last few years have taught us anything in healthcare, it’s that disruption isn’t going to stop anytime soon, so stabilizing measures like this can play a major role in the sustainability and resilience of your organization.  

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