Transcript Making A Title Slide

FY10 Budget Planning Meeting
January 22, 2009
By
Kristin Ramsey, Director, Nursing Operations
Dina Pilipczuk, Business Manager, Patient Care Operations
Northwestern Memorial
Hospital
Agenda
• Overview of Patient Care Budget Process
• Review of FY10 Productivity Improvement Guiding Principles
• Review of Expectations / Timeline
• Open Discussion
Recent Economic Headlines
•
“Loyola Hospital to lay off 200 in 5% budget cut”
-
Crain’s Chicago Business, December 8, 2008
•
“Edward Hospital cuts 100 jobs amid financial pressures”
•
“University of Chicago Hospital to trim 7% of budget”
•
“Loyola Medical Center to cut 200 non clinical jobs”
– Crain’s Chicago Business, May 22, 2008
– Chicago Tribune, January 10, 2009
–
Chicago Tribune, December 8, 2008
NMH Cost per Equivalent Inpatient Day
Comparison to Benchmarks
Calendar Year 2006
(FY06 - FY07)
$3,500
Calendar Year 2007
(FY07 - FY08)
$3,500
3,043
2,937
$3,000
$3,000
$2,500
$2,500
1,874
$2,000
1,845
1,208
1,136
$1,000
$500
$500
$0
$0
NMH
U of C
Barnes
MassGen
UPMC
1,818
1,738
1,335
$1,500
$1,000
Stanford
2,089
$2,000
1,396
$1,500
2,380
Stanford
U of C
NMH
Barnes
↓ (3.5%)
↑ 29%
↑ 11%
↑ 30%
Source: COTH QUARTERLY SURVEY OF HOSPITAL OPERATIONS & FINANCIAL PERFORMANCE; excludes all neonatal and newborn cases
UPMC
↑ 53%
MassGen
↑ 11%
NMH Nurse to Patient Ratios Are in the Top 15%
Nationally for ICUs & Top 25% for M/S Units
Unit
California
Mandatory
Ratios
Med/Surg
Step-Down
Intensive Care
* Perspectives on Staffing & Scheduling 2008 Annual Survey of Hours
1:5
1:4
1:2
PSS*
NMH
1:5.1
1:3.7
1:1.9
1:4
1:3
1:1.5
Patient Care Budget Elements
•
•
•
•
Transparent
–
Guiding principles developed and shared across all practice areas
Benchmarked
–
Internal and external standards for ratios and education/orientation hours
– California ratios
– Local area ratios
Formula Based
–
Budget template incorporates Guiding Principles
Consistently Monitored
–
Ongoing reinforcement of fiscal accountability/responsibility
Steps in Patient Care FY10 Budget Planning
1. Identify productivity improvement opportunities
–
–
Done by Patient Care Staff, Managers, and Directors
Proactively identify areas for improvements
2. Develop volume projections
–
–
–
Done by Finance, Business Development & Patient Care Directors
Anticipate planned program growth
Analyze trends in actual volume to predict future volume
3. Build the departmental budget
–
–
–
Based on guiding principles; incorporates productivity improvement
strategies
Done by unit managers
Budget workbook includes FTE calculator & staffing planner
Patient Care Staffing Budget Components
Unit Budgets reflect 83-87% Direct Hours & 13-17% Indirect Hours
Patient Care
Staffing Budget
Direct Care
Indirect Care
• Nurse to Patient
Ratios
• Core Staff:
RN,PCT, US
• Staff Development
• Orientation/ CE
• Unit Leadership: Mgr,
CC, SE
Direct HPPD
Indirect HPPD
Productive HPPD
Unproductive Time
•
•
•
•
Paid Time Off
Holiday
Vacation
Sick
Over Hiring Case Study Unit
•
•
•
•
•
•
Unit currently 58% higher than budgeted volume through Q1 FY09
Current RN budget = 18.6 FTEs
Unit needs 26.9 FTEs to accommodate additional volume (+8.3 FTEs)
8.3 FTEs at supplemental wage rate = $1.1M (annual)
8.3 FTEs at regular wage rate $571K (annual)
Savings generated from overhiring = $490K (annual)
Exceptional Financial Performance
•
Facilitating success at the unit level w/ staff RN involvement
Staffing Decisions


Flexing to volume and acuity appropriately
Appropriate safety aide utilization
Scheduling System




Importance of data accuracy and integrity
Garbage in = garbage out!
Impact on DHPPD
Impact on FY10 budget projections
Resource Management
 Appropriate utilization of supplies
• Continuously ensure Exceptional Financial Performance


Units are held accountable to their performance
Productivity reports are shared across departments
Employee Cost Savings Initiative
•
•
•
•
NMH employees asked to submit 1 cost savings idea in
FY09
3300 ideas were submitted:
–
–
–
–
–
Going Green (Utilities/Recycle)
Supplies
Productivity
Purchased Services
Other
44%
26%
10%
8%
12%
As of January 2009, 375 ideas were implemented through
18 projects
Projected cost savings of approximately $17M
FY10 Productivity Improvement
Guiding Principles
1. Staff nurses will be involved in formulating & monitoring unit
budgets
2. Productivity improvement strategies should not shift costs to or
negatively impact other areas
3. Productivity improvement strategies will be validated during
current year to ensure success in FY10
Tools/Resources
• Managers will receive planning packets that include:
–
Copy of presentation to guide discussions
–
Specific FY10 budget targets by unit
–
Planning worksheet to track strategies
–
Helpful info such as average wage rates, FTE translation, etc.
Example of Specific Unit Targets
Example of Strategies Tracking Worksheet
Think About…..
• Who will be on your team?
–
•
How will the meetings be conducted?
–
•
Agenda, talking points, collecting ideas
Who is available for support?
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–
•
representation from all shifts
Director/ Preceptor/Dina
Admins (copies, etc.)
How much time to allow?
–
–
–
Time to meet with staff
Time to translate ideas to planning worksheet
Time to discuss with director prior to submitting
Time Line
Task
Date
FY10 Budget Planning Process Kick off
1/22
Managers receive individual packets/tools via email
1/23
Managers collect productivity improvement strategies from staff
1/23 – 2/5
Managers submit individual strategies/templates
2/5
Directors review & prioritize all strategies
2/9
Financial modeling of selected strategies
2/10 – 2/20
Approval of strategies
2/23-2/27
Rollout of pilots for operationalization of strategies
3/2 - 4/3
Assessment of effectiveness of pilots
4/6