Finance and Clinical Services Collaboration Aligning
Hospital Resources to Save Costs
Patti Medvescek, MT ASCP, MPA
August 13, 2015
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
1
Objectives
1.
Identify key success factors for using benchmarks in the
budgeting process.
2.
Gain knowledge about tools used to successfully maintain ontarget performance.
3.
Review results from the continuous monitoring process used by
Indiana University Health facilities.
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
2
• Admissions
136,371
• Outpatient Visits
2,638,074
• Employees
29,395
• Staffed Beds
3,098
• Physicians
2,111
FY 2014
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Indiana University Health Facilities reporting in Action O-I
 IU Health Methodist
 IU Health University
 IU Simon Cancer Center
 IU Health West
 IU Health North
 IU Health Arnett
 IU Health Ball Memorial
 IU Health Bloomington
 IU Health Goshen
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
4
Timeline
2002
• 1st Upload
2005
• Focused Staffing
2006
• Benchmarks Compared to Budgets
2008
• Department Engagement
2010
• Budget process Integration
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Timeline
2013
• Benchmarks used to determine
budgets – all flexing centers
2015
• Benchmarks used to determine
budgets – all centers
Truven Health Analytics Puerto Rico Summit 2015
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The Budget Process
 Budget Pre-Work
 Budget Open
 Budget Reviewed
 Negotiations begin
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Adding The Benchmarks
Within Finance
Compared budgets to benchmarks
Review for outliers
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The Process : A Review
1st : Budgets
2nd: Benchmark reports
3rd: Organizational
Change
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Improving the Process
Added Clinical Management Review
Meetings
 Skill Mix reports
 Volume Confirmation
 Characteristic Surveys
 Compare Group Facilities
 Benchmarks accepted by Clinical
Leaders
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Summary Report : All Units
Planned Performance to Benchmarks
2016 Budget
CC
2016
Days
CC Description
D HPPD
W
HPPD
50th
HPPD
Variance
HPPD
Variance
Impact
FTEs
Impact
101100
A7 SOUTH-ONCOLOGY
MH
4,896
9.52
11.95
11.41
(0.54)
(2,666)
(1.28)
101105
YELLOW ROSE B6
MH
2,975
8.00
10.65
10.95
0.30
902
0.43
101110
A7N SOLID ORGAN
TRANSPLANT
MH
6,934
9.89
12.10
12.11
0.01
69
0.03
101120
A6 SOUTH FAMILY PRACTICE
MH
14,457
10.49
12.26
10.81
(1.45)
(20,928)
(10.06)
101155
NEUROSCIENCE NURSING
MH
10,509
9.55
11.54
11.99
0.45
4,747
2.28
Truven Health Analytics Puerto Rico Summit 2015
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Finance and Clinical Services
A Collaborative Effort
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Continuous Improvement
 Budget Training 
 Benchmark Review 
 Biweekly monitoring 
 Incorporating benchmarks in budgeting process 
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The Budget Process
1. Budget Calendar
2. Roll Out Budgets
3. One on One
Meetings
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Confidential — For Internal Use Only
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Tools for Budgeting
Historical Performance
Benchmark reports
Staffing Grids (the budget)
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Biweekly Performance Reports
Visionware 6 Pay Period Trends
Performance to current target
Overtime Utilization
Volume trends
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Visionware 6 PP Trend
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Confidential — For Internal Use Only
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Benchmark Reports
Custom Comparison Report
 Department Statistics
 Skill Mix
 Labor Productivity
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Benchmark Reports
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Benchmark Reports
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2016 FTE Detail Grid
UH RH Neurophysiology
109050
Starting Assumptions Target 2015
% Mix
10905
0Proce
dures 109050 Procedures
Procedures
100.0%
5,773
Direct Care Hours per Unit of Service (Weighted Average)
Fixed FTE
Units of Service
Var/
Fix
Position
Position
Variable
F
C1178
Coord - Neuro Clin Education
F
F
V
V
F
C343
C496
C500
C628
C687
Coord-Intraoperative Neuro
Technol-Neurodiagnostic I
Technol-Neurodiagnos III-IONM
Technol-Eeg-Flat Rate
Technol-Neurodiagnostic II
Total
Total
3.58
Direct Care FTE needed:
Check should = zero
3.58
(0.00)
Budget
Request
Fixed
Mtg/Edu
Prod.
FTE
Orient.
0.91
6.58
4.13
0.70
4.17
2.2
1.38
16.49
1,319.20
-
-
25th %ile Ftes
Variance
30th %ile FTEs
Variance
40th %ile FTEs
Variance
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1.2969
21
2016
2015
1.2966
1.2966
16.49
13.08
5,773
4,698
Non.
Calc Total
Prod.
FTE
-
-
0.91
8.78
5.51
0.70
4.17
0.09
0.77
0.54
0.44
1.00
9.55
6.05
0.70
4.61
20.07
1.84
21.91
21.10
1.03
21.68
1.61
23.48
3.41
The New Budget Process
 One on One meetings
 Finance and Clinical Services
 Real Time Revisions
 Discussions about staffing changes



Impact
Implementation
Realistic goals
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Confidential — For Internal Use Only
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End Result
Budget review and approval
complete – in one day.
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For the first time, nursing managers could SEE the impact of
their changes immediately. Knowing that they were accountable
for meeting their targets – they were very interested and very
serious about this process.
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What Didn’t Change
Finance provided the volumes and
historical data
Staffing grids used to quantify
productivity
Clinical leadership actively involved
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What Did Change
Direct connect Finance -> Clinical
Services
All tools available during process
Focus on accountability
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What Didn’t Work So Well
Group meetings
 Individual discussions lost in
the process
 Focus on outcomes lost in the
process
 Lack of collaboration
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The Tools We Used
Benchmark reports
Productivity reports
Finance 101 curriculum
Daily staffing tools
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Finance 101 Curriculum
 Benchmarks, Budgets and Income Statements
 Staffing and Scheduling
 Productivity
 Advanced Staffing and Scheduling
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Daily Staffing Tool
Tool for nursing unit managers on a
day to day level.
Staff hours entered
Patient census entered
Calculated variance to target
(Red/Green) by 4 hour shift, by day and
by pay period
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Conclusion
 Finance and Clinical Services are working
together.
 Finance = pre-work,
 Clinical Services = acuity, staffing patterns
Truven Health Analytics Puerto Rico Summit 2015
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The Impact for Our Customers:
“The partnership with finance and nursing has helped us build a
budget and operational plan that is realistic and obtainable-with
the sharp aim on achieving organizational and unit level goals.”
Sally, CNO
Truven Health Analytics Puerto Rico Summit 2015
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The Impact for Our Customers:
“The discussions across the budget planning table are rich and
educational. Finance brings their perspective and expertise; nursing
brings their perspective and expertise and through active exchange,
participation and clarification among all participants, learning across
disciplines occurs and a realistic budget plan gets built.”
Sally,
CNO
Truven Health Analytics Puerto Rico Summit 2015
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The Impact for Our Customers:
“I have been surprised and pleased at the depth of knowledge and
insight shown by our colleagues in finance. They have challenged
me to think differently-which has resulted in improving productivity
and operations. Without this relationship, key opportunities may
have been left on the table.”
Sally, CNO
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
34
The Impact for Our Customers
“The tools we have available now help my management team
understand the impact of staffing decisions, while providing
guidelines for safe staffing levels. The daily staffing tool ties it all
together – from the budget and benchmarks to the day to day unit
decisions.” Jill, Nursing Director
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The Impact for Our Organization
“By working in collaboration with Nursing to
understand benchmarks and using those
benchmarks in aligning goals, we have found a
much more fair and equitable approach to
meeting budget goals. Not only has
benchmarking made the budget process more
efficient, but we have found that the
collaborative approach has made the budget
process more effective since Nursing is
engaged in the target setting process.”
Lesley, Director-Finance
Truven Health Analytics Puerto Rico Summit 2015
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The Results: Improved Utilization
Center
2010
HPPD
2011
HPPD
Volume
FTE
Impact
363056
12.683
11.297
663
1.91
363402
11.606 12.199
2565
-3.17
363404
11.200
9.708
2989
9.29
363406
10.654
9.226
3458
10.29
363502
.219
.208
57583
1.32
Total
19.64
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
37
Objectives
1.
Identify key success factors for using benchmarks in the
budgeting process. 
2.
Gain knowledge about tools used to successfully maintain ontarget performance. 
3.
Review results from the continuous monitoring process used by
Indiana University Health facilities. 
Truven Health Analytics Puerto Rico Summit 2015
Confidential — For Internal Use Only
38
Questions?
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ForInternal
InternalUse
UseOnly
Only
39