Transform Your Labor Cost Management Strategy: Introducing the Health Catalyst PowerLabor™ Application
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Labor costs encompass nearly 60 percent of the typical healthcare budget and are growing faster than healthcare systems can afford. COVID-19 responses only exacerbated this financial pressure. Controlling escalating labor costs means eliminating waste and using data to find where budgeted staffing hours exceed or fall short of patient needs. Most organizations have the wrong tools to understand labor demands and instead try to guess future patient volumes and staffing needs by using retrospective data that lacks timeliness. The Health Catalyst PowerLabor application leverages augmented intelligence (AI)-powered forecasting capabilities to deliver accurate labor data to operational leaders. With timely workforce insight, health systems can close the gap between staff budgeting and future patient volumes, control labor expenses, and track progress toward budget and staffing targets. Join John Hansmann, Senior Vice President of Strategic Consulting Operations at Health Catalyst, and Sean Latimer, Senior Director of Product Management at Health Catalyst, as they demonstrate how PowerLabor can help your organization increase productivity while ensuring resources for excellent patient care. What You’ll Learn About PowerLabor: • View Comprehensive Labor Data in One Place: Department and unit managers can analyze labor costs with an integrated view of all labor productivity data, including cost and hours, by system, location, department, team, and job role in one location. • Proactively Schedule to Volume: With a complete view of categorized labor hours in relation to costs (e.g., contracts, premiums, overtime, and staffing mix), decision makers can easily identify labor trends, comparisons, and rollups across departments to accurately predict labor needs, plan for changes in staffing, and optimize staff to patient ratios. • Drive Adoption with Expert Guidance: To maximize the PowerLabor application, Health Catalyst experts help categorize and refine data through an initial assessment and data integration from multiple data sources (e.g., EMR, billing, HR/payroll, time and attendance, and general ledger). Our implementation teams also provide train-the-trainer sessions to drive the most effective adoption.
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Transform Your Labor Cost Management Strategy: Introducing the Health Catalyst PowerLabor™ Application
- 1. © 2021 Health Catalyst Transform Your Labor Cost Management Strategy: Introducing the Health Catalyst PowerLabor™ John Hansmann, SVP, Strategic Consulting Operations, Financial Transformation Sean Latimer, Sr. Director, Product Management, Financial Transformation
- 2. © Health Catalyst. Confidential and proprietary. 54.6% Salaries, wages, and benefits 17.6% Supplies 13.3% Purchased services 14.5% - All other expenses 54.6% Labor Expense Why Address Labor Expenses? Historical U.S. Hospital Profits Fall as Labor Costs Grow and Patient Mix Shifts Decline points to new challenges for U.S. hospitals as more patients seek medical care in nonhospital settings Sources: https://www.modernhealthcare.com/article/20180829/NEWS/180829884/not-for-profit-hospitals-cost-cutting-isn-t-keeping-up-with-revenue-decline, August 29, 2018 https://www.wsj.com/articles/u-s-hospital-profits-fall-as-labor-costs-grow-and-patient-mix-shifts-1524495601, April 23, 2010
- 3. © Health Catalyst. Confidential and proprietary. Why Address Labor Expenses? COVID-19 Impact Wage and Labor Costs Increased • Hospital and health systems continue to experience staff shortages and increased hours for some hospital workers • Implemented bonus pay and other similar measures • Hired outside agency and contract labor due to staff shortages Health Care Job Losses • Hospital and health systems laid off and furloughed employees • Health sector lost 1.58M jobs in March and April Volume lost during pandemic • Inpatient levels back to pre-pandemic levels • ED/Urgent Care visits continue to be down 4 Source: Hospitals and Health Systems Continue to Face Unprecedented Financial Challenges due to COVID-19, American Hospital Association, June 2020
- 4. © Health Catalyst. Confidential and proprietary. Why Address Labor Expenses? Going Forward Market Changes • Value Based Care • Baby Boomer impact Volume Shift • Movement to outpatient • Telehealth growth? • Medicare enrollment increasing Non-traditional providers • Amazon • Walmart • CVS 5 Occupation Outlook 2018-2028 Source: Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook. on the Internet at https://www.bls.gov/ooh/healthcare.htm (visited January 09, 2020).
- 5. © Health Catalyst. Confidential and proprietary. Why Address Labor Expenses? Most healthcare systems don’t have the tooling, resources, and processes to generate timely and meaningful labor productivity data. They either rely on generic, delayed reporting or spend inordinate amounts of time and resources cobbling together a homegrown system.
- 6. © Health Catalyst. Confidential and proprietary. 7 • Analytics tool that allows managers to understand basic operational and staffing indicators to facilitate more efficient labor force utilization. • Users access and dynamically interact with EMR, GL, HR, payroll and timecard data from multiple source systems to discover meaningful opportunities for improvement. What Is PowerLabor?
- 7. © Health Catalyst. Confidential and proprietary. Proven Success in This Space 15 Subject Matter Expertise Labor experts assist with upstream data health and process change through implementation and improvement services. Augmented Intelligence (AI) Leverage Healthcare.AI to accelerate valuable AI use cases, starting with forecasting and issue identification. Future: Real-time, shift-level forecasting. Analytics Robust reporting and self-service analytics from executive-level views to staff-level details. Data Integration Daily data feeds from: • Time and attendance • Payroll • General ledger • EMR
- 8. © Health Catalyst. Confidential and proprietary. JULY 2021 FINANCIAL EMPOWERMENT SERVICES Key needs • Lack of analytic insight: Leaders often struggle to identify the specific data and metrics needed to understand labor needs, resources, costs, and efficiency—and to provide timely and holistic views of trends, variances, and drivers that help them manage more proactively. • Inability to move from insight to action: Leaders need support to craft strategies and interventions that match the complexity of the organization, leverage best practices from other systems, and allow them to manage transparently to the benefit of staff and patients. Distinguishing features • Industry-experienced guidance: With extensive backgrounds in healthcare labor, analytics, and process improvement, our consultants bring a deep knowledge of industry standards and best practices to each partnership. • Flexible offerings to organizations’ unique needs: – Strategic Assessment: Provides a comprehensive review of labor management capabilities—and delivers quantitative and qualitative findings and actionable recommendations for improvement. – Strategy Operationalization: Helps your organization execute labor management improvement initiatives grounded in your current realities and aligned with your overall strategy and vision. – Expanded Education Program: Uses a practical, case-based approach to building your organization’s capability for labor management excellence. – Ad-hoc Labor Management Consulting: Offers flexible, focused ad- hoc consulting for any aspect of labor management operations. Health Catalyst’s Labor Management Expert Services facilitate a strategic, data-driven approach to labor management, helping organizations to understand and improve labor costs, provider productivity, process efficiency, and workforce planning. Labor Management Expert Services
- 9. © Health Catalyst. Confidential and proprietary. You Have PowerLabor. Now what? Operationalize. 17 Things to look for: • Actual to Budget o Costs o Hours o Volumes • If hours are on budget but costs are not, focus on Hours Types o Overtime o Double Time o Premium o Contract Labor/Agency Reduce Labor Spend • Matching staffing with workload requirements • Scheduling the right number of staff by shift • Open positions?
- 10. © Health Catalyst. Confidential and proprietary. Proven Success in This Space • $2.2M annual savings at HPH while maintaining clinical quality • ~2% total reduction in labor spend at TCH • 800–900 users at UPMC accessing PowerLabor bi-weekly Client validation
- 11. © Health Catalyst. Confidential and proprietary. Cost Management Consulting A data-informed approach to evaluating your resource spend and identifying the optimal pace, sequence, and type of changes necessary to achieve cost management improvement. Supply Chain Consulting Empowering insight to better analyze, understand, and navigate the increasing complexity of supply chain activities to cut waste, trim costs, and deliver quality. Our Financial Empowerment Framework JULY 2021 PowerCosting™ PowerLabor™ PowerBudget™ (coming 2022) Analytic Accelerators Plan your budget Integrate your budget planning into your overall costing efforts. Improve labor productivity Access timely, accurate, actionable data for better staffing decisions. Understand your costs Reduce expenses and variation, and negotiate favorable, at-risk contracts. Tailor your financial analytics Run your business with flexible, open access to your data Department Explorer: Emergency Services | Department Explorer: Surgical Services Key Process Analysis | Provider Productivity | Revenue Cycle Advisor | Supply Chain and more… Labor Management Consulting Industry-expert guidance for optimizing your labor management program and implementing near- and long-term improvement in labor costs, provider productivity, process efficiency, and workforce planning. Expert Services to help deliver real value (optional add-on services) Other Financial Advisory Services Access to our team's comprehensive expertise and experience across a range of additional healthcare finance and operations areas, including revenue cycle, patient flow, practice management, and more.
- 13. The Healthcare Analytics Summit 2021 - Virtual Visit hasummit.com to register and learn more • Industry-Leading Featured Speakers • 21 Educational Breakout Sessions • CME Accreditation for Clinicians • Analytics and AI Showcases, Networking, and More • Virtual Platform optimized for a live experience Sept. 21 – 23, 2021 (half-day sessions) o Steve Kerr o Rana el Kaliouby, PhD o Vin Gupta, MD, MPA, MSc o Chris Chen, MD o Amy Compton-Phillips, MD o Brent C. James, MD, Mstat o Sadiqa Mahmood, DDS, MPH “The virtual experience was beyond any other that I've attended. You all did a wonderful job of creating an "in- person" feel and I appreciate that as a learner. The virtual platform was very intuitive and fun.”