CFO Issues


INSIGHTS Organizational Roll-up

One key to optimum labor productivity is an understanding of the institution's structure of staff organization. With a firm grasp of functional reporting relationships, senior leadership can uncover opportunities for change. INSIGHTS' Organizational Roll-up feature delivers a valuable "span of control analysis" that reviews the organization and the reporting structure of a specific facility and visually maps the unique reporting responsibilities of each level—from senior executive management through directors and managers. Once the structure is visually defined, imbalances can be identified that negatively affect effective communication, administrative management, and implementation of strategic initiatives. This knowledge gives leaders the ability to recognize resource expenditures that could be better applied elsewhere.


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Measuring Productivity

Measuring productivity in a meaningful way has never been more important for healthcare institutions. Yet, often the information collected is either pointless (and overly abundant) or not detailed enough to rely on for decision making. Amassing actionable productivity metrics at the macro level for an entire organization is relatively easy to accomplish. But it's at the department or individual job level that the process becomes not only laborious and complex but also elusive. Some healthcare institutions, however, are able to collect, report, and assess data down to the employee and pay code level in seconds. Can your system do that?


Pressure to be more productive

As a result of the national healthcare mandate, hospitals, medical centers, clinics, and other healthcare organizations are becoming increasingly focused on ramping up labor productivity and optimally managing resources and decreasing costs—all while trying to enhance the quality of care. Total labor expense for healthcare provider organizations can exceed 50 percent of a hospital's operating costs and 90 percent of its variable costs. The ability to reduce labor costs by even a very small percentage is critical to increasing the operating margin and helping grow the bottom line.


Hospitals and healthcare organizations must be able to monitor and manage productivity on a timely basis and more accurately forecast staffing needs compared with actual volumes. They also need access to micro-level data and an effective reporting format that enhances understanding and accountability in order to insure the optimum staffing to achieve their benchmark targets for quality, outcomes, and costs.


Controlling labor costs

INSIGHTS® Labor Productivity assists hospitals with labor expense control, productivity, and efficiency, by immediately identifying process and performance improvement opportunities that can lead to significant hospital-salary expense savings—without compromising the quality of care delivered. It provides decision makers with comprehensive monthly, bi-weekly, daily, or even shift-based information about productive and non-productive labor costs. In seconds, this data can be collected, reported, and compared to flexible or fixed budget figures for full-time equivalent employees (FTEs) per productivity (workload) unit at the department/job, pay code, and employee level.


INSIGHTS Labor Productivity enables organizations to adapt reports to the unique needs of any area within the enterprise—inpatient, outpatient, surgical suite, and so on. Managers get timely reporting that combines relevant indicators of workload, and calculates required hours for comparison to actual hours so they can make sufficient staffing modifications.


Another way INSIGHTS® Labor Productivity helps monitor labor rates and identifies opportunities for efficiency improvement is by detailed monitoring of overtime, agency use, skill-mix, and pay-rate decisions to balance the mix of employed to supplemental staff. In addition, labor review and automated alerts based on user-defined benchmarks display on-demand and foster a culture of accountability.


Realize the advantages of INSIGHTS Labor Productivity

HCI believes that monitoring productivity is an ongoing process—a process that has become even more important as healthcare providers are challenged, on a daily basis, to manage costs as well as revenues. INSIGHTS Labor Productivity delivers accurate, well-timed information that helps hospitals manage to budget, adjust actual to required staffing levels, adjust staffing mix, and assess productivity. But realizing these advantages also requires the commitment and involvement of all levels of management to:


  • Link hospital labor productivity to cost and budgets;
  • Align labor decisions with strategic objectives;
  • Identify and quantify savings opportunities;
  • Benchmark hospital performance standards at the corporate, facility, and department cost-center levels.


INSIGHTS Labor Productivity enables healthcare organizations of all sizes to meet all of these criteria and optimize labor expenditures while enhancing patient care. Can your system do that?


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