See how three Care Logistics hospitals are increasing efficiency in care delivery to improve healthcare quality and nurse morale while reducing costs from overtime, agency use, and turnover. By Care Logistics CFO Samantha Platzke.

1. labor costs
5 Signs That You Can
Reduce Staffing Costs and
Boost Nurse Satisfaction
BySamanthaPlatzke
Improving efficiency in care delivery
improves healthcare quality and nurse
morale while reducing costs from
overtime, agency use, and turnover.
Our company recently posted a social media link to an
article about how stress is overwhelming nurses. The post
received many responses, mostly from exasperated care-
givers imploring that providers “just hire more nurses.”
Finance leaders understand that sentiment but often
feel pressure to maintain or reduce nursing headcount.
Hospital leaders typically manage their nurse labor pools
through schedule planning, daily reconciliation of time
scheduled to time worked, staff deployment with automat-
ed scheduling systems, and open shift filling.
However, these approaches do not always effectively
predict and match nursing resources with patient clin-
ical demand. That discrepancy can lead to undesirable
outcomes—frustrated nurses, overstaffed or understaffed
units, costly overtime and agency staffing, and possible
lapses in care.
The following are five signs that your hospital can better
match clinical demand with capacity to capture labor sav-
ings while boosting morale.
Sign No. 1: Productivity And Efficiency Challenges
Has your hospital failed to reach peak productivity and
efficiency in care delivery? Even asking this question can
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2. concern many nurses and clinical leaders
because they regard efficiency programs as
code for cutting corners
and increasing workloads.
Not so, says Scott Wolf, DO, MPH,
FACP, president, Mercy Medical Center,
Springfield, Mass. Mercy embarked on
a clinical transformation initiative in
2013 that has built efficiency and contin-
uous improvement in care coordination
from admission to discharge.
“It’s not about doing more with less,”
says Wolf, citing an efficiency mantra that
many have come to dread. “It’s about doing
different with different.”
His hospital adopted a new, hub-and-
spoke care model that has improved point-
to-point communications, bottlenecks,
and poor care handoffs. This foundation for
efficiency may drive more accurate staffing
and lead to happier nurses.
Sign No. 2: Agency Staffing Use
Do you depend heavily on agency resourc-
es and overtime? Overtime and outside
nursing resources can be costly when
used to meet unanticipated demand.
Mercy Medical Center Chief Nursing
Officer Jessica Calcidise, RN, believes the
remedy for this is better anticipation of that
demand.
“When you make the operations and out-
comes of care delivery reliable and predict-
able, you also make patient clinical demand
more predictable,” Calcidise says. “The
whole system and the units know which
patients are going where, for how long, and
what the care path will be. It makes staffing
more precise and attentive to the needs of
all patients.”
When you make the operations
and outcomes of care delivery
reliable and predictable, you
also make patient clinical
demand more predictable.
Calcidise cites Mercy’s rapid, dramatic
reductions in overtime and agency labor,
which dropped from more than 17 percent
to approximately 5 percent over three years
from the launch of its care coordination
initiative.
“We credit these results to our care coor-
dination initiative,” says Calcidise. “By tak-
ing a systemwide approach to care delivery,
we can much more precisely predict and
staff for patient demand. And the nurses
are much more focused on patient care in-
stead of wearing out shoes and phone lines
tracking down information, test results,
people, and equipment.”
The hub-and-spoke model at Mercy has
contributed to an overall annual financial
benefit of $7.8 million, driven by through-
put efficiencies that have significantly
reduced both inpatient and observation
length of stay, increased case-mix index,
and lowered rates of readmissions and
leaving without treatment.
Mercy Medical Center’s new care
model, along with other internal
initiatives, has also contributed to an
$858,000 reduction in costs for nursing
agency and overtime labor.
A Hub-and-Spoke Care Model
Thehub-and-spokeapproachcentralizescare,establishingaphysicalhubandtechnologythat
connectsandcoordinatespeopleandcareactivities.Coordinatorsmanagecareactivitiesand
throughputacrosspeopleanddepartments.Hospitalsmovefromdepartment-basedcareand
servicestocarethatfocusesonthepatientandhospitalgoals.Themodelestablishesefficiency,
predictability,andtimeliness,improvingthroughputwhileservingpatientsandcaregivers.
Source:CareLogistics,Alpharetta,Ga.Usedwithpermission.
2 December2016 Healthcare Cost Containment
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3. Sign No. 3: Nurse Satisfaction
Are you struggling to keep your best nurses
happy—and employed? According to a
2016 research survey published by NSI
Nursing Solutions, the average cost of
turnover for a bedside registered nurse
ranges from $37,700 to $58,400, resulting
in the average hospital losing $5.2 mil-
lion—$8.1 million at the 2015 turnover rate
of 17.9 percent. So nursing turnover costs
hospitals millions while disrupting care
continuity, damaging morale, and creat-
ing staffing challenges. Many factors lead
to nurse dissatisfaction—understaffing,
compensation, and lack of growth oppor-
tunities (Teeter, K., “Relationship Between
Job Satisfaction and Nurse to Patient Ratio
with Nurse Burnout,” Nursing Theses and
Capstone Projects, 2014, Paper 39).
But one of the core stresses for nurses
is the fear that distractions and activities
unrelated to care will create situations in
which they could potentially harm pa-
tients. A 2014 nursing survey by Jackson
Healthcare highlights the concern that
chaos in care coordination robs nurses
of time they should spend with patients
(“Practice Trends and Time at Bedside,”
Jackson Healthcare and Care Logistics,
2014). Specifically, poor care coordination
can lead to the following problems.
>>Poor communication among nurses,
doctors, hospital leaders, and staff on
units and service areas
>> Time wasted arranging, tracking,
and following up on patient tests and
procedures
>> Nurses needing to divide their time
among more patients
>>Nurse fatigue from excessive overtime
To avoid these negative consequenc-
es, healthcare leaders should focus on
the efficiency of the system. “The value
of streamlining nursing workflows and
finding ways to make nursing care more
efficient is immeasurable,” says Brittney
Wilson, BSN, RN, an author and a blogger
also popularly known as “the Nerdy Nurse.”
“Nurses are tired of spending their time
communicating the same things multi-
ple times. It takes them away from their
patients and reduces their ability to provide
well-rounded care.”
Bethesda Health, Boynton Beach, Fla.,
also adopted a centralized care model that
connects and coordinates the right people
and care activities, giving nurses the time
back to spend at the bedside, not on the
phones and running the hallways.
“The centralized care management
model empowers the nurses,” says Mary
McClory, RN, LHRM, CPHQ, vice president
of quality, Bethesda Health. “For example,
daily progression huddles on the unit gath-
er nurses, doctors, and other caregivers
responsible for ensuring that patient care
plans and discharge targets stay on track.”
In addition, the optimized care mod-
el gives nurses and other staff the tools,
platform, and freedom to shine in their
positions.
“We’ve seen some of our best nurses
grow and flourish,” McClory says. “They
identify challenges to care and throughput,
Nursing Overtime and Temporary and Agency Hours as a Percentage of Productive Hours
LeadersatMercyMedicalCenterreducednursingovertimeandagencylaborfordirectcareinpatientunitsfrommorethan17percenttoapproxi-
mately5percentoverthreeyears.
5%
Nursingovertimeandtemporaryandagencyhours
7%
9%
11%
13%
15%
17%
19%
Jan. Feb. Mar. Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec.
2013
2014
2015
Source:CareLogistics,Alpharetta,Ga.Usedwithpermission.
hfma.org/hcc December2016 3
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4. and apply problem-solving tools to coach
hospital leaders during weekly rounding to
improve all aspects of patient care and the
patient experience.”
Sign No. 4: Patient Satisfaction
Are patient experience scores lagging?
It makes sense that understaffing would
spread nurses thin across too many patients
and diminish patient satisfaction. But it is
about more than just numbers. It is about
what the nurses are empowered and asked
to do, and how much they are allowed to
focus on patient care and treatment.
For example, some suggestions for
improving patient satisfaction seem to have
little to do with providing better care and a
more satisfying experience. One example is
encouraging nurses to say the word “always”
frequently when interacting with patients
because that is the desired answer to each
of the HCAHPS survey questions.
Such attempts to finesse higher survey
scores are aimed in the wrong direction.
Hospitals should focus on processes and
tools that allow nurses and teams to coordi-
nate quality care for all patients. If hospitals
reliably can get that right and keep improv-
ing, happy and satisfied patients and nurses
will likely follow.
Sign No. 5: Nurse-to-Patient Ratios
Do nurse-to-patient ratios fail to closely
match clinical demand with nurse capac-
ity on the units? Nurse-to-patient ratios
do not always accurately match clinical
demand with nursing capacity. This is an
area where many hospitals are applying new
technologies to improve staffing precision.
Holy Cross Hospital, Fort Lauderdale,
Fla., adopted software that provides
demand visibility across the units from
a central hub, with a staffing coordinator
continuously matching unit patient demand
and nurse capacity for upcoming shifts.
“It makes real-time scheduling and
staffing objective, rather than subjective,”
says Brandon Charette, operational perfor-
mance coordinator. “We can tell at a glance
whether upcoming unit shifts properly
match the clinical needs of the patients,
and adjust assignments accordingly.”
He says the system looks ahead in one-
hour increments, which helps them ac-
count for continuous changes in workload,
admissions and discharges, and patient
clinical needs across the hospital.
“We used to track it on paper as best as we
could,” Charette says. “Now the system tells
us immediately: Are we flexing appropri-
ately? Are we understaffed? Are we floating
people appropriately? Is it affecting our dis-
charge times? It’s really advancing the objec-
tives of our care coordination initiative.”
Predicting and Planning
“One of the most interesting things about
working in a hospital is dealing with a
fluctuating census,” author and blogger
Wilson says. “With the feast or famine
world in staffing needs, hospitals are
throwing money down the drain if they are
not actively working to predict and plan for
clinical demand.”
As you wrestle with reducing and
forecasting labor costs, consider the five
signs that your hospital may benefit from
creating a better match between clinical
demand and capacity. In addition, con-
sider approaching the remedies not as
isolated cost containment projects, but as
opportunities to transform care delivery to
continuously improve quality, experience,
throughput, and flow.
Samantha Platzke
isCFOandseniorvicepresidentofsystemperfor-
mance,CareLogistics,Alpharetta,Ga.,andamember
ofHFMA’sNorthwestOhioChapter(info@carelogis-
tics.com).
Interviewedforthisarticle:
Scott Wolf, DO, MPH, FACP,
ispresident,MercyMedicalCenter,Springfield,Mass.
Jessica Calcidise, RN,
ischiefnursingofficer,MercyMedicalCenter.
Brittney Wilson, BSN, RN,
isanauthorandabloggerpopularlyknownas“the
NerdyNurse”(thenerdynurse@gmail.com).
Mary McClory, RN,
isvicepresidentofquality,BethesdaHealth,Boynton
Beach,Fla.
Brandon Charette
isoperationalperformancecoordinator,HolyCross,
HospitalFort Lauderdale,Fla.
ThisarticleoriginallyappearedintheDecember2016issueofHealthcareCostContainment.
Copyright2016byHealthcareFinancialManagementAssociation,ThreeWestbrookCorporateCenter,Suite6­00,Westchester,IL60154.
Formoreinformation,call800-252-HFMAorvisithfma.org.
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