Labor Productivity - King’s Daughters Medical Center
The Case: King’s Daughters Medical Center, Brookhaven, MI
King’s Daughters Medical Center, a 90-bed facility located in Brookhaven, Mississippi, was struggling to adjust its staffing to reduced volumes, and was in jeopardy of losing money due to its inability to control staffing levels in the hospital.
“We were showing an 8 percent operating loss after two months of our fiscal year,” said KDMC CEO Alvin Hoover. “With the downturn in our state and local economy, our financial situation looked pretty bleak.”
Q Solutions
QHR began by helping the hospital develop staffing grids based on Operations Outlook 90th percentile. This helped ensure that KDMC had the right mix of staff in place. QHR also helped the hospital’s department managers, who were struggling to meet hours per patient per day (HPPD) targets. Working together, they created schedules that were easily adjusted to census fluctuations.
In addition to the staffing grids, QHR and the department managers established minimum core staffing needed for each department. By having the minimum core staffing, and the staffing grids and schedules, the hospital was assured that it would have the right staff at the right time to care for the needs of each job.
Most importantly, QHR and KDMC’s interim CFO partnered in the development of a daily staffing tracking tool, which – to this day – helps the hospital make staffing adjustments on a daily basis, rather than two-to-three weeks retrospectively.
The Results
Within a month of launching the new staffing grids, schedules and daily staffing tool, KDMC’s red ink disappeared and the hospital posted a positive bottom line, even though patient volumes were still down.
“Over the final 10 months of our fiscal year, we reduced our salary expense by $785,000,” Hoover said. “And even though our patient volumes never recovered, we turned our -8 percent operating loss into a 2.7% operating margin.”
Hoover attributes the success of this turn in economics, in large part, to getting a handle on the staffing expense.
“With the daily staffing tool, it’s much easier to monitor staffing. My managers report staffing on a daily basis. They take full ownership of the process. They have the tools they need to be successful,” he said.
“Having real time information for managing labor – especially in a small hospital that doesn’t have the budget for a large, expensive system – is invaluable.”
