Position'Control'Management,'Automation'and'Payroll ... · • Best tool to reduce over scheduling...

Position'Control'Management,'Automation'and'Payroll'Leakage'Presented'by'Labor'Management'Institute'at'the'Minneapolis'HR'Summit'on'June'12,'2019

©2019'Labor'Management'Institute,'Inc.'No'duplication'or'distribution'without'the'written'permission.' 1

Perinatal Budget, Staffing and Scheduling Best Practices

6th Annual Perinatal Leadership ForumNovember 5, 2019

Jennifer Guild, RN, MSN, CNML, CSSC™

LABOR MANAGEMENT INSTITUTE, INC. © 2019 ALL RIGHTS RESERVED

OBJECTIVE

Identify the components of best practices in budgeting, staffing and scheduling that impact patient outcomes and fiscal accountability.


DISCLOSURE

I have nothing to disclose.




Healthcare is changing…• Cost

• Hospitals closing

• System consolidations

• Shrinking profit margins (Kacik, 2019)

The reality of our struggle…


What can we as leaders' control?

Staffing

• 60 - 70% of the operating budget

• Largest percent of staffing budget

• Nursing leaders have the most impact


Knowing & Owning Your Financial Budget

• Key to your leadership• You can’t lead if you can’t take responsibility for actual to

target variances• You can’t manage what you can’t measure • You can’t change what you can’t document• Units, service lines and departments that fail to “know

their numbers” set themselves up for changes and reductions they are helpless to change




Beyond immediate financial cost…

• Safety of our patients (Liu et al., 2012 & Paulsen, 2018)

• Safety of staff

• Ramifications (Witkoski Stimpfel et al., 2013 & Paulsen, 2018)


Beyond immediate financial cost…

• Wisconsin OB nurse charged with manslaughter

• Minnesota nurse falls asleep behind the wheel after working overtime

• Ohio nurse killed on her way home after working a 12-hour overtime shift


Financial Management & Budget Basics




Managing FinanciallyA Financial & Clinical Partnership

New Era

Nursing

Staff Nurses

Finance

Nurse Leaders


Unit DescriptionsWhat kind of unit is your unit & why does it matter?

• Basis for defining your budget FTEs, Key Performance Indicators (KPIs) and ratios • Basis for your unit description, team and workload criteria (LMI, 2018)

• Benchmarking to other similar units gives you data to DEFEND your KPIs to tell your story


Obstetric Units & Workload Measurement

Unit Name Workload Indicator Hours Per Unit of ServiceGynecology Census HPPDAnte-partum Census HPPDPost Partum Census HPPDMother Baby Couplets H/Couplet

Labor & Delivery Deliveries H/DeliveriesLabor, Delivery & Recovery Deliveries H/Deliveries

Labor, Delivery, Recovery & Post Partum Deliveries H/DeliveriesLabor, Delivery, Recovery, Post Partum & Nursery Deliveries H/Deliveries




Labor Budget LifelineAll components must be linked for success

Budget Position Control Schedule Target Staff Workload


Workload Units of Service (UOS)

• The foundation for telling your unit’s story

• The foundation for defending your budget

• The foundation for asking for increases


Blended Census vs. Midnight Census

Nursing AND Finance Experience“We are full all the time, but midnight census doesn’t reflect it”

Average Daily Census (ADC) PLUS consideration forBedded OutpatientsUnit based outpatient treatments Outpatient observation and treatments




Most Frequent Volume (MFV)Definition: Most commonly occurring volume (deliveries) by day of week

• Best guideline for pro-active scheduling & staffing

• Best tool to reduce over scheduling fixed by over-staffing, floating or cancelling

• Best tool to prevent under-scheduling fixed by short staffing, floating or calling-in, extra, OT & agency

L & D Unit Mon Tue Weds Thu Fri Sat Sun Avg.Budget Deliveries 20 20 20 20 20 20 20 20

MFV Deliveries by Day of Week (DOW) 26 24 26 22 16 14 12 20

# of RNs at Budget if Ratio is 1:2 10 10 10 10 10 10 10 10

# of RNs at MFV if Ratio is 1:2 13 12 13 11 8 7 6 10Variance Budget to MFV or

Over/Under-Staffed -3 -2 -3 -1 +2 + 3 +4 + / - 4


Most Frequent Volume Worksheet (LMI, 2019)


Budget ComponentsAdjusted annual volumes = primary + secondary workload that counts into the annual volume

LDRPN Statistics #

Annual Deliveries 2,847 (7.8/Day)Observation Hours 3,900

Total Adjusted Hours 3,900Divide by Budget Total Worked Hours/Delivery ÷ 33.43 Hours

Adjusted Deliveries 116.66

Annual Deliveries + Adjusted Deliveries = Total Adjusted Deliveries

2963.66

Divide by 365 = Adjusted Average Daily Deliveries 8.12/Day




Other Workload Types for Obstetrics1. # of Deliveries

2. # of Couplets

3. # of Ante-partum patients

4. # of Surgical cases and Hrs. per surgical case

5. # of RN 1 to 1 events and RN hrs. per 1 to 1 event

6. # of OB triage patients and Hrs. per OB triage patient

7. # of Observation/holding patients and Hrs. per observation or holding patient

8. # of Visits and Hrs. per visit

9. # of Follow-up discharge phone calls and Follow-up discharge phone call hrs.

***Follow-up phone calls improve patient satisfaction 30 to 40% & decrease readmissions!


Obstetrics (LDRPN) Case Study: HPPD vs. HPDelivery


Sharing Tools For Your Tool Chest

Budget, Policies &Position Control Standards

Workload / Units of Service (UOS)

Scheduling & Staffing

Management ReportingBenchmarking




What is the Budget?Annual plan that establishes revenue & expense relationships• Specifies the workload type demand• Identifies deficit demand • Sets the foundation for the resource management plan

Budget assumptions• Flexible or variable budgeting is the foundation of census driven schedule• Expenses and revenue will remain relative as agreed• Volume is projected for each schedule & staffing response adjusted• Worked hours are determined for each workload unit of service (UOS)


Standard Financial Terms

Direct Hours Per Unit of Service (H/UOS): A standard measure that quantifies the direct care worked hours available to each patient by direct caregivers.

Example: Post Partum UnitCalculating Direct H/UOS (HPPD):Census: 20 Post Partum Patients

7 direct staff (6 RNs- includes charge & 1 NA) X 3 shifts = 21 direct staff per day

21 staff X 8 hrs. per shift = 168 worked hrs. ÷ 20 patients = 8.4 Direct Care HPPD

RN to Pt. Ratio: 1 to 3.3NA to Pt. Ratio: 1 to 20


Standard Financial Terms

Indirect Hours Per Unit Of Service (H/UOS): a standard measure that quantifies the indirect care worked hours supporting the direct caregivers.

Total Worked Hours Per Unit Of Service (H/UOS): a standard measure that quantifies all (direct & indirect) worked hours in a unit or department.

Example: Post Partum UnitCalculating Total Worked H/UOS (HPPD):Census: 20 Post Partum patients

7 direct staff (6 RNs & 1 NA)

X 3 shifts = 21 direct staff

2 indirect staff (1 Mgr. & 1 Clerk) x 1 shift = 2 indirect staff

23 staff X 8 hrs. per shift = 184 worked hrs.÷ 20 patients = 9.2 Total Worked HPPD




BudgetCore vs. Supplemental Staffing

• Developed with a staffing pattern as the base

• Division of direct, worked and paid FTEs and hours

• Indirect caregivers (aka: fixed)

Direct Indirect


BudgetCore vs. Supplemental StaffingCORE• Budget FT & PT FTEs to cover the budget or target workload each shift each day

each schedule• Includes range of staffing elasticity for the budget key skill mix % and ratio

Supplemental • Budget FTEs to cover replacement of planned, unplanned absence, education,

meeting and orientation • SOURCES: Unit based PRN, Floating, Resource Pool, outside Agency and

Travelers

Direct Indirect


Laying the Financial Foundation

• Consider the model of care delivery impacting the distribution of care hours• Core direct staff• Core indirect staff• Unit description and scope of service considerations• Reconcile the Position Control list to the unit's core schedule• Budget sitter hours and FTEs• Overtime• Outsourced supplemental staffing




Calculating FTE Budget Using Target Hours/UOS

Example Unit: Labor/Delivery

Direct (Variable) FTE Based on the Target Hours/UOS (Hours/Delivery)

Indirect (Fixed) FTE Based on the Target Hours/UOS

Projected)Annual)Volume)x) Target)Total)Direct)Labor)Hours)÷

FTE)Definition)= Annual)Direct)FTEs)

9125%Deliveries%X 12.36%Hours/Delivery%%÷ 2080%= 54.22%Direct%FTEs

Projected)Annual)Volume)x) Target)Indirect)Labor)Hours)÷ FTE)Definition)= Annual)Direct)FTEs)

9125%Deliveries%X 2.06%Hours/Delivery%%÷ 2080%= 9.03%Indirect%FTEs


Calculating Hours/UOS Using FTE RequirementsRNs• 25 Deliveries/Day x 9.78 Hours/Delivery = 244.5 RN Hours/Day

• 244.5 RN Hours ÷ 12 Hour Shifts = 20.37 RN Shifts/Day • 244.5 RN Hours/Day x 365 Days/Year = 89,242.5 Hours/Year• 89,242.5 Hours/Year ÷ 2080 Hours/FTE = 42.90 RN FTEs

PCTs• 25 Deliveries/Day x 2.58 Hours/Delivery = 64.5 PCT Hours/Day

• 64.5 PCT Hours ÷ 12 Hour Shifts = 5.37 PCT Shifts/Day • 64.5 PCT Hours/Day x 365 Days/Year = 23,542.5 Hours/Year

• 23,542.5 Hours/Year ÷ 2080 Hours/FTE = 11.31 PCT FTEs


Position Control

• Allows leadership to monitor all filled and vacant positions

• Identifies all budgeted positions

• Identifies all new or non-budgeted positions

• Prescription to the labor budget




Position Control PurposeAssists leadership to determine:

• FTE/Shift needed to cover the department appropriately (Suby, 2010)

• Unbudgeted labor requests• Departmental vacancy rates• Departmental turnover rates• Predict additional resources required when volume increases• Labor plan to deliver organizational outcomes


Advantages of Position Control

• Consistency • Control and management of budget• Diminished legal risk• Reports and analytics for workforce planning• Reduction of risk of missing key positions • Reporting of the positions and vacancies in the organization• Ensures discipline surrounding positions (Lockton, 2015)


Labor Productivity

• Measure of how efficiently your labor force is utilized• Skill mix, staffing patterns and workload scheduling• Timely and accurate information allows monitoring, maintaining and

adjusting labor resources to achieve optimal efficiency




Creating Position Control

• Define schedule requirements

• Define positions Full-Time (FT) & Part-Time (PT) for weekend coverage

• Budget core FTEs by skill mix

• Budget Education, Meeting, Orientation (EMO) & Non-Productive (NP) FTEs

• Combine core + supplemental (EMO & NP) FTEs to plan required on-call staff, resource pool FTEs or additional unit staff if you are hiring into the FTEs (no more than 50%)


Full-time & Part-time Ratios

Why does it matter?

• Resource for employee shift exchanges or trades

• Resource for workload fluctuation that avoids overtime

• Source to cover unit-based budgeted deficit demands

• Source to cover service-line budget deficit demands

• Determines total positions for position control


Managing Position Control

• Determine the rules

• Maintenance

• Develop Reports




Best in Class Position Controls

INCLUDE:

• Budget information • Staff data • Staffing plans built on budget• Workload scheduling• Vacant positions


Position Control Example BUDGET YEAR: 2019 FTE DEFINITION: 2080

DAYS/YEAR: 365 DEPARTMENT: MOTHER BABY

COST CENTER: 6121 CAPACITY: 30

WORKLOAD TYPE: DELIVERIES BUDGETED AVG DAILY UNIT OF SERVICE: 24

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Best In Class PC’s Capture

Departmental• Vacancy rates• Turnover rates (NSI, 2019)

• Full-time vs. Part-time percent• Operational vacancy• Totals identifying hired vs. budgeted FTEs by skill mix and

hired shift • Comparison of budgeted workload to actual workload




Scheduling

• Short range plan based on the budget• Defines deliverable clinical resource• Manager is accountable for schedule

Right PersonRight&PlaceRight TimeRight SkillsRight&Cost


Scheduling Principles: Weekends

• Every other weekend off policy means 1/2 of staff will be unavailable every weekend

• Every third weekend off policy means 2/3 of staff will be unavailable every weekend

• Weekend needs will determine total number of staff required on unit

• Weekend needs will determine FT & PT mix


Scheduling Principles: Scheduling Order

Permanent Shifts• FT employees• PT employees

Rotating Shifts • FT employees • PT employees• Per diem or casual employees

Scheduling FT around PT employees incentivizes the PT at the expense of the FT employees




Making the Most of Your ResourcesFlexible or Alternative Shifts are Helpful When

• The workload is > 8-hrs.

• The workload is < 8-hrs.

• The workload is variable by day of week

• Call-back hours occur within 2-hrs. of the end of the shift

• It meets the needs of the unit, service-line or department and does not cause unplanned OT or disruption in unit coverage


Scheduling to Unit Workload CapacityWhen it’s not the Most Frequent Volume (MFV)

NOT good practice!• Increases use of non-productive (backfill) hours taking you over budget

• Increases worked hours on the unit if staffing overages not caught or if staff refuse to float or go home

• Increases risk for greater turnover because of the frequent staffing changes due to shift cancellations, floating out of the home unit or using benefit time to cover cancellations


Constructing the Schedule1. Begin with staffing and scheduling template2. Schedule policy rules3. Update work agreements & skill mix changes4. Update block, core patterns5. Assign weekends to work & be off in order of6. Schedule preceptors with orientee’s7. Enter FMLA 8. Enter approved requests for time off based on budget 9. Schedule FT, then PT rotating staff in order of DN, DE10. Assign charge nurses and other unique skills to all shifts




Constructing the Schedule

11. Check your work12. Shift audit to requirements13. If you’re scheduled shifts are < your requirements what’s your strategy to fix it in

order of least to most expensive?14. If scheduled shifts are > your requirements what’s your strategy to fix it in order of

most to least expensive15. Best Practice Schedule Audit; publish with schedule16. Audit past schedule & publish

17. Prepare for next schedule


Be Operationally Clear & Transparent

• The schedule represents the department plan to deliver safe and effective care

• Your priority is to produce a safe schedule, only so many staff can be off at one time and still accomplish this

• You can only grant the time away budgeted

• If staff have benefit time available, they may find their own replacement, not in overtime

• Monitor and hold staff accountable for excessive absenteeism (CDC, 2018)


OvertimeWhy do we care?Direct impact

• Increases operational costs • Reduces available funds for hiring more staff, equipment, new or expanded

programs etc.

Indirect impact• Increases risk of adverse outcomes• Increases employee job dissatisfaction, burn out, turnover• Increases employee fatigue contributing to “failure to rescue”, on-the-job

employee injuries and unplanned absences (call-ins)




Guidelines for Overtime Usage (LMI, 2019)

OT% Recommended+Findings+&+Implications<+5%

Reasonable)response)to)fluctuating)workload)volumes)or)deficit)demands

5+to+7.9% Sign+of+financial+bleeding+Consider)schedule)imbalances)(e.g.,)too)many)on)the)day)shift)and)inadequate)coverage)on)the)off)shifts),)over?authorizing)employee)requests)such)as)PTO)requests)causing)staffing)shortages

8%++ Sign+of+financial+hemorrhaging+Consider)vacancies,)ADT)activity)within)the)unit)that)creates)workload)intensity)and)workload)fluctuations,)mismatched)8)&)12?hour)shift)combinations)in)addition)to)the)previous)suggestions


How Overtime Adds Up

1-hr. per shiftX 3 shifts/day 3 hours X 365 days/year (38,325 per year)X $54.00/hour (OT rate) (US News, 2018)

$59,130 + Per Year


Hospital Unit PlanA Variable Staffing Plan exists which does not exceed the budget

Flex when census ↑ or ↓

• A plan exists for managing low census/census fluctuation • The impact of incentives, premium pay, bonuses is demonstrated• A clear plan exists for managing overtime• Advanced planning occurs for seven to ten days • The charge role is clearly defined- responsible for staffing that follows the financial

pathway of the manager and organization• When variations from the plan occurs the leader follows up to understand and

coach if appropriate




Using KPI for Staffing DecisionsBudget Data & Summary in Hours/Delivery by Day & Shift: Labor/Delivery/Recovery

Budget Data Per day 700 1500 2300RN hours / UOS (Hours/Delivery) 13.11 4.37 4.37 4.37Direct hours / UOS 16.66 5.55 5.55 5.55Indirect hours / UOS 2.72 1.08 1.08 0.54Total worked hours / UOS 18.88 6.63 6.63 6.09Total paid hours / UOS 21.14 7.38 7.38 6.84

Budget workload by day and shift BUOS / day 700 1500 2300Average daily deliveries (BUOS): 16 16 16 16

1. Assess workload & actual staff every 4-hours2. Multiply actual UOS X the selected KPI for day = delivery hrs./day ÷ 8 or = # staff

needed in 8 or 12-hour shifts3. Subtract actual staff from calculated staff = variance in staff to increase or decrease


Monitoring for Success

• Review of labor and productivity targets by the manager daily is the most optimal method to allow for daily trending of volume and labor hours

• Daily monitoring encourages the department to respond to changes in the volume/work units on a real time basis to ensure appropriate use of staff

• Educate and coach charge nurses to be part of the solution

• Monitoring by managers & directors each pay period allows unit managers to course-correct for the next pay period with measurable results in the fiscal or monthly reports

“What gets measured, gets done.”


Our Goal….



Thank You!

If you have any questions or would like to chat, please stop by BOOTH 47


References CDC (2015). Worker Illness And Injury Costs U.S. Employers $225.8 Billion Annually. Retrieved from https://www.cdcfoundation.org/pr/2015/worker-illness-and-injury-costs-us-employers-225-billion-annually

Kacik, A. (2019). Operating margins stabilize, but not-for-profit hospitals still vulnerable. Retrieved from https://www.modernhealthcare.com/providers/operating-margins-stabilize-not-profit-hospitals-still-vulnerable

Labor Management Institute, Inc. (2018). PSS Annual Survey of Hours Report (28th ed.). Bloomington, MN.

Labor Management Institute, Inc. (2019) Clinical Staffing and Scheduling Certification. Bloomington, MN.

Liu, L., Lee, S., Chia, P., Chi, S., & Yin, Y. (2012). Exploring the Association Between Nurse Workload and Nurse-Sensitive Patient Safety Outcome Indicators. The Journal of Nursing Research, 20, 300-308.

Lockton, M. (2015). Position Control 101: It helps manage an organization’s structure. Retrieved from https://www.hr.com/en/topleaders/all_articles/position-control-101-it-helps-manage-an-organizati_i8x5ayua.html


References cont.

Nursing Solutions Inc. (2019). 2019 National Healthcare Retention and RN Staffing Report. Retrieved from http://www.nsinursingsolutions.com/Files/assets/library/retention-institute/2019%20National%20 Health%20Care%20Retention%20Report.pdf

Paulsen, R. (2018.) Taking nurse staffing research to the unit level. Nursing Management, 7, 42-48.

Suby, C. (2010). Controlling Overtime Through Position Control. Healthcare Financial Management Association Healthcare Cost Containment, 4.

US News (2018). How Much Does a Registered Nurse Make? Retrieved from https://money.usnews.com/careers/best-jobs/registered-nurse

Witkoski Stimpfel, A., Lake, E., Barton, S., Chavanu Gorman, K., & Aiken, L. (2013). How Differing Shift Lengths Relate to Quality Outcomes in Pediatrics. Journal of Nursing Administration. 43, 95-100.

https://www.cdcfoundation.org/pr/2015/worker-illness-and-injury-costs-us-employers-225-billion-annually

https://www.modernhealthcare.com/providers/operating-margins-stabilize-not-profit-hospitals-still-vulnerable

https://www.hr.com/en/topleaders/all_articles/position-control-101-it-helps-manage-an-organizati_i8x5ayua.html

https://money.usnews.com/careers/best-jobs/registered-nurse




2019© Labor Management Institute, Inc. All Rights Reserved. Duplicating this program without the written permission of Labor Management Institute, Inc., (LMI) is a violation of copyright laws and strictly prohibited and may subject the offender(s) to civil liability and severe criminal penalties.

Please visit Labor Management Institute at LMInstitute.com or call at 952-746-7610 to obtain information about its educational seminars and certification programs, research and consulting opportunities or contact ChrysMarie Suby to obtain written permission to reference the material in this program at [email protected].

http://www.lminstitute.com/

mailto:[email protected]

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