1. Chapter 7. Staffing
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

2. Outline Workload Management Overview
The Establishment of Work Standards and Their Influence on Staffing Levels
Patient Acuity Systems
Internal Work Standards
Utilization of FTEs
FTEs for Nurse Staffing
Coverage Factor
Reallocation-Daily Adjustments
External Work Standards
Productivity & Workload Management
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

3. Importance of Staffing Decisions
Human resources is the greatest expenditures of many health care organizations.
In manufacturing, determination of skill-mix and staffing levels is fairly straight forward.
In healthcare, uncertainty makes staffing particularly difficult.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

4. What would you do? Staff for peak levels at all times?
Staff for minimum census and acuity levels?
Staff for minimum census and acuity levels and
hire part time agency nurses?
What are problems with each approach?
A solution-- flexible staffing!
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

5. Flexible Staffing
Setting a core level staff based on a long term needs assessment which is then augmented by short-term (daily) adjustments using various methods to match staffing levels and patient needs.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

6. Figure 7.1 Workload Management
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

7. Workload Management: the components
Staffing-- determining the appropriate number of full-time equivalents (FTEs) to be hired in each skill class (RN, LPN, aides, MHA, MBA, etc..)
Scheduling-- who is on and off duty and when; operational procedure
Reallocation-- fine tunes the previous decisions; daily if not shift by shift
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

8. To staff efficiently we need a standard!
Work standard-- a predetermined allocation of time available for each unit of service (presumably at the appropriate quality level)
Acuity Adjusted-- patient days are adjusted for the acuity level of the patients being served
Example: Nursing hours per patient day
Procedural standard-- when the unit of service is a procedure, such as a lab test or x-ray
Example: Technicians per CT scan
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

9. What is a problem with this approach?
Standard development
Historically based solely on estimated average census of the entire organization
What is a problem with this approach?
1) Doesn’t account for unit to unit variation.
2) Dependent upon a physician estimate of LOS.
Today, precise estimates of LOS can be determined from information systems.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

10. An adequate staffing system contains three components.
Reliable patient classification and acuity system that determines patient need for services based on patient specific characteristics.
Development of time standards to reflect the time needed to provide services based on the patient classification system.
A method of converting total service time needed to FTEs
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

11. The patient classification and acuity system
Departmental acuity adjusted census is best for determining workload standards
Fewer staffing adjustments are necessary when an admissions monitoring information system is based on the unit’s patient care requirements rather than unit census.
An illustration: Who requires more
care, a patient in the ICU or one
recovering from minor surgery?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

12. Before developing acuity standards. . .
A patient acuity system is necessary to measure the amount of care required by any given patient.
Also called patient classification systems
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

13. Types of Acuity Systems
Prototype systems
Classify according to type of care needed
Patients grouped into 3-10 categories based on expected time commitments, diagnosis, mobility, and education needed
Highly subjective; easy to implement
Factor-analytic systems
Establishes classes by summing relative values assigned to individual tasks or indicators of patient needs (Example: GRASP, MEDICUS)
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

14. Number of Patients in Acuity Level
Table 7.2 Daily Census, Required Labor Hours, and Acuity Level Statistics for a Medical/Surgical Floor.
If staffing was based on unadjusted census, inaccuracies would result. For instance, compare January 5 (Census = 9) and January 7 (Census =12). Which day would require a greater number of FTEs?
Census
Based on Patient Classification--
Required Hours
per Patient Day
Number of Patients in Acuity Level
Date
Day of Week AM PM
Night
Total 1 2 3 4
01/02/05
SUN 12 13
12.3
2.3
1.4
0.8
4.5 6 7
01/03//05
MON
1.9
1.6
0.9
4.4
01/04/05
TUE 22 10
18.0
2.1
1.7
1.0
4.7 5 16
01/05/05
WED 9
9.0
4.8
01/06/05
THU 11
10.3
1.8
4.1
01/07/05
FRI
12.0
1.3
0.7
3.6
01/08/05
SAT
11.7
2.0
4.6
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

15. Number of Patients in Acuity Level
Table 7.2 Daily Census, Required Labor Hours, and Acuity Level Statistics for a Medical/Surgical Floor.
But, if we look at acuity levels, we observe that 80% of patients on January 5 are in categories 3 and 4, compared to only 17 percent in these categories on Jan. 7. The greater acuity is reflected in the greater number of required hours.
Census
Based on Patient Classification--
Required Hours
per Patient Day
Number of Patients in Acuity Level
Date
Day of Week AM PM
Night
Total 1 2 3 4
01/02/05
SUN 12 13
12.3
2.3
1.4
0.8
4.5 6 7
01/03//05
MON
1.9
1.6
0.9
4.4
01/04/05
TUE 22 10
18.0
2.1
1.7
1.0
4.7 5 16
01/05/05
WED 9
9.0
4.8
01/06/05
THU 11
10.3
1.8
4.1
01/07/05
FRI
12.0
1.3
0.7
3.6
01/08/05
SAT
11.7
2.0
4.6
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

16. Percent of Patients in Acuity Level
Table 7.3 Average Census, Required Labor Hours, and Acuity
Level Statistics for a Medical/Surgical Floor.
Average Census
Based on Patient Classification--
Avg. Required Hours
per Patient Day
Percent of Patients in Acuity Level
Year
Month AM PM
Night
Total 1 2 3 4
2003
January
14.1
13.8
13.9
1.8
1.5
0.9
4.1
26.3
26.9
45.0
1.7
February
14.9
14.3
14.4
26.2
31.8
38.6
3.3
March
15.3
14.6
1.9
4.3
19.7
27.5
48.8
3.5
April
18.7
18.4
18.2
1.4
0.8
27.3
26.4
44.3
2.0
May
19.8
19.5
19.3
1.6
4.4
21.7
21.0
52.7
June
19.2
18.5
18.3
4.2
23.8
24.9
50.2
1.1
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

17. Table 7.3 Average Census, Required Labor Hours, and Acuity
Level Statistics for a Medical/Surgical Floor (Cont.)
July
8.7
8.2
7.5
8.1
1.7
1.4
0.8
4.0
18.0
43.4
38.1
0.6
August
8.0
6.7
7.4
1.6
3.7
23.1
44.8
32.1
September
6.9
6.5
1.8
15.4
44.6
38.2
October
6.4
6.1
5.3
5.9
1.5
0.9
4.1
13.0
39.7
47.3
November
13.5
13.2
12.7
13.1
28.7
30.4
38.3
2.6
2004
December
13.3
12.6
11.2
12.4
1.3
0.7
30.3
43.6
25.7
0.4
2005
January
11.3
10.1
10.9
1.9
4.2
18.9
32.7
45.9
2.5
Statistics
Mean
14.4
13.9
13.4
14.0
1.8
1.5
0.8
4.1
23.3
32.0
42.1
2.4
Minimum
4.5
4.4
4.3
1.6
1.3
0.7
3.7
12.2
21.0
25.7
0.0
Maximum
22.8
22.2
21.9
22.3
2.0
0.9
38.0
44.8
53.7
5.2
St. Deviation
5.3
5.1
0.1
0.2
6.7
6.8
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

18. Standard Development
Standards can be internal or external -- choice of standards used depends on cost and accuracy targets
Internal standards are often more accurate
The first step in standard development is identifying and documenting the activities performed on the unit/department being examined
What tools might you use to identify these activities?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

19. Fixed or Variable? Can you think of examples of each?
All activities identified should be classified as fixed or variable
Fixed -- do not vary by volume
Variable -- fluctuate with services offered
Classification by direct or indirect care should also be made
Direct -- centered around the patient
Indirect -- Patient care support services
Can you think of examples of each?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

20. Determining Activity Times
Often no need to analyze all activities on the unit, but the activities chosen should be representative of all department activities
For some departments, it is better to analyze all activities, especially if service mix and complexity differs greatly
What are some tools we can use to determine activity times?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

21. We should remember these!
Work sampling
often done by outside source
Time and motion studies
expensive and time consuming; not common in healthcare
Estimation- low cost and minimal time
Historical averaging- easiest and least $$
Logging- excellent, low cost method
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

22. To determine work standards. . .
Divide the total estimate of hours required for a given activity by the total volume to determine the workload standard.
If Radiology works 1500 hours to produce 3000
x-rays, the work standard would be:
1500 hrs.
3000 x-rays
= 30 minutes per x-ray
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

23. But can we expect 100% from anyone?
Many factors prevent 100% staff utilization
Controllable-- staff scheduling, avoidable delays, scheduling of vacations,
Uncontrollable-- physician ordering patterns (and golf tournaments!), sick leave, market constraints of labor force
Estimating Utilization
Review historical levels and agree to a target
Quantify delays and downtime and allow for acceptable levels
Calculate a weighted average utilization
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

24. Table 7.4 Weighted Average Utilization for a Laboratory Based on Workload Fluctuations by Shift
Percent of Work Load
(A)
Expected Utilization (Percent) (B)
Weighted Utilization (A*B)
Morning 45 95
.428
Afternoon 35 85
.298
Evening 7 90
.063
Night 13
.111
Total
100
0.900
Weighted Average Utilization Target = 90 %.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

25. Example 7.1
A teaching hospital’s laboratory routinely performs nine microscopic procedures. Average monthly volume of each procedure has been determined from the historical data. An earlier time study also revealed the workload standard for each procedure, as shown in Table 7.5.
Table 7.5 Workload Standards for Microscopic Procedures in Laboratory
Variable Activities
Volume
(# of procedures per 30-day period)
Workload Standard (hours per procedure)
Standard Hours for 30-day period
Procedure 1
350
.12
42.00
Procedure 2
222
.30
66.60
Procedure 3
185
.45
83.25
Procedure 4
462
.26
120.12
Procedure 5 33
.84
27.72
Procedure 6 12
.88
10.56
Procedure 7 96
.362
34.75
Procedure 8
892
.46
410.32
Procedure 9 26
1.9
49.4
TOTALS
2278
844.72
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

26. Solution:
The first step in setting staff levels for a procedure is to discover the number of procedures to be performed (A).
By multiplying the volume for each procedure by the workload standard, a time estimate for each activity is made.
The sum of the standard hours represents the total time needed to perform the procedures (B).
Because this total represents only the direct procedure hours of the technicians, it must be augmented by the indirect (support) hours, which in this example are estimated at 0.21 hours per procedure. Table 7.4 depicts these calculations.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

27. Table 7.6 Calculation of Staffing Requirements for Microscopic Procedures
Total volume of activities (tests) (A)
2278
Total direct procedure hours (B)
844.72
Indirect support hours (C) = .21 x (A)
(assume 0.21 hours per procedure)
478.38
Subtotal variable hours required (D) = (B) + (C)
Department utilization target (E) [from above]
90.00%
Total variable hours required (normalized) (F) = (D)/(E)
Constant hours (G) (30 days at hours per calendar day in this example)
368.40
Total target worked hours required (H) = (F) + (G)
Total target FTEs required (I) = (H) divided by (hours per FTE per month-- (40 hrs./wk. x 52 wks)/12 months)
10.61 FTEs
Vacation/holiday/sick FTE allowance (J) = (I) x 9.8% (percentage varies by hospital department)
1.04 FTEs
Total Required Paid FTEs (K) = (I) + (J)
11.65 FTEs
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

28. Determination of FTEs for Nurse Staffing.
Determination of the FTEs required to staff a nursing unit requires several steps. First, the minutes of required care is determined using the following formula:
Minutes of Care Required = (Average Census)*(Average Required Minutes per Patient)
This equation then should be divided by the number of minutes available to work per nurse per day (equals 8 hours/day * 60 minutes/hour, or 480 minutes available) to determine the number of unadjusted FTEs. Thus, in second step, unadjusted FTEs are calculated using the next formula:
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

29. Determination of FTEs for Nurse Staffing.
However, this method of calculation assumes 100 percent utilization of the staff, an assumption that is clearly unrealistic for the reasons mentioned earlier. Suppose that the administration has established a utilization standard of 0.75; that is, 75 percent of each employee’s time will be spent in unproductive activities, or activities unrelated to direct patient care. The number of minutes available to work per nurse per day (example, 480 minutes) must be adjusted by the utilization standard; hence in the third step, core level FTEs is determined with this formula:
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

30. Example 7.2:
The nursing manger would like to determine the number of nursing staff needed for the medical/surgical unit. Table 7.2 and Table 7.3 provide census and acuity information for a medical/surgical floor.
Solution:
Table 7.2 provides information on the daily census for January, Table 7.3 aggregates the monthly data to provide the average census over a 25-month period. Notice that the mean values presented in Table 7.2, are the same as those found in the January, 2005 row in Table It is important to realize that the core staffing levels in this example are found through a retrospective analysis of average monthly census and required hours per patient day.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

31. Percent of Patients in Acuity Level
Table 7.3 Average Census, Required Labor Hours, and Acuity Level Statistics for a Medical/Surgical Floor.
Average Census
Based on Patient Classification--
Avg. Required Hours
per Patient Day
Percent of Patients in Acuity Level AM PM
Night
Total 1 2 3 4
Mean
14.4
13.9
13.4
14.0
1.8
1.5
0.8
4.1
23.3
32.0
42.1
2.4
Minimum
4.5
4.4
4.3
1.6
1.3
0.7
3.7
12.2
21.0
25.7
0.0
Maximum
22.8
22.2
21.9
22.3
2.0
0.9
38.0
44.8
53.7
5.2
Std. Deviation
5.3
5.1
0.1
0.2
6.7
6.8
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

32. The third step determines the core level FTEs, using formula:
Solution:
The first step of the staffing calculation is to find the total number of minutes of care required, using formula:
Minutes of Care Required = (Average Census)*(Average Required Minutes per Patient).
Minutes of Care Required = (14 * 4.1)*60 minutes = 3444 minutes.
The second step uses next formula to divide the number of minutes available to work per nurse per day (480 minutes) to determine the number of unadjusted FTEs required.
The third step determines the core level FTEs, using formula:
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

33. Determination of FTEs for Nurse Staffing.
Coverage Factor.
One other adjustment must be made to make sure that the core staffing levels are as accurate as possible. The above calculation assumes that employees will be available to work 365 days per year, without vacations, sick days, or holidays. To adjust for these factors, we must calculate a coverage factor.
An example of the coverage factor adjustment is found in Table The first step in its determination is subtracting weekend days per year and benefit days from the required coverage days per year (365 in most any health care organization), to arrive at a total of available days per FTE (line 5).
By dividing the total number of required days per year by the total available days, we obtain a coverage factor. This coverage factor is then multiplied by the unit FTE requirements to calculate the total unit FTE requirements.
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

34. Total Unit FTE Requirements
Table 7.7 The Effect of Shift Alternatives on Staffing – The Coverage Factor
Assumptions
5/40 or
2/12 & 2/8 Plans
4/40 or 4/36 Plans
(1) Required Coverage Days per Year
365
(2) Weekend Days per Year
104
156
(3) Benefit Days
Vacation
Sick Days
Holidays
Other 10 7 1
(4) Total Allowance Days of FTE (2) + (3)
129
181
(5) Total Available Days of FTE (1) - (4)
236
184
(6) Coverage Factor (1)÷(5)
1.55
1.98
Shift Alternatives
Unit FTE Requirement
Coverage Factor
Total Unit FTE Requirements
5/40
9.6
1.55 15
4/40
1.98 19
4/36
2/12 & 2/8
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

35. Can the core level staff handle the unit’s activities?
Figure 7.2 Distribution of Daily Workload on a Nursing Unit
Can the core level staff handle the unit’s activities?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

36. External Work Standards
Two Types:
Industry Standards
Professional Standards
Must be careful to adjust these factors for case-mix and skill-mix
Per se standards have been argued to lead to staffing standards that are inaccurate
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

37. Size and design of facility Average length of stay
Exhibit 7.6 Factors to be Considered in Deciding on Staffing Levels
Size and design of facility
Average length of stay
Non-nursing responsibilities
Nursing responsibilities
Intensity/acuity levels of patients
Reliability of patient classification system
Clinical expertise of available staff
Organized system of patient education
Staff mix
Research and data management responsibilities
Patient transport responsibilities
Physician practice patterns
Facility census patterns
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

38. External Work Standards
It is important to recognize that no standard is absolute. Some room must be left for flexibility in staffing. Figure 7.3 demonstrates how statistical analysis can reveal whether the staff is meeting the standards.
Figure 7.3: Workload Standard Tolerance Ranges
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

39. Staffing and productivity
Departmental productivity (the ratio of required hours to number of hours actually worked) is a measure of staff utilization
Appropriateness of employee skills
Matching of skills to job descriptions
Worker satisfaction and work organization, retention, recruitment, and transfers also impact productivity
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

40. Staffing problems impacting productivity of workforce
Work load volume fluctuations--MD vacations impact ER staff productivity
Work load scheduling--should eliminate fluctuations as much as possible
Skill Mix--does it match work needs?
Staffing patterns-- can staff meet demand fluctuations?
Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan

41. The End Chapter 7: Quantitatve Methods in Health Care Management
Yasar A. Ozcan