Collaborative consumption and the businesses that use this new economic model have been making headlines. So, what is collaborative consumption? One definition explains that collaborative consumption “unlocks hidden value in the assets we’ve acquired and skills we’ve developed.”1
Uber is a well-known example of collaborative consumption. Before Uber and other companies like it, the car service industry used a top-down approach, with cab drivers being dispatched to pick up riders. This traditional method makes it more challenging to match rider needs with available drivers. In addition, drivers have limited visibility and input into their schedules which can lead to a work/life imbalance and unhappy drivers.
Uber revolutionized the car service industry by taking a more direct approach. With their collaborative consumption model, Uber provides area-wide visibility into rider need and driver availability without the need for a middleman. This transparency allows supply and demand to self-establish equilibrium. Drivers are more empowered, and happy drivers make for happy riders.
A similar model is being used to innovate how staffing is done in the healthcare industry, helping health systems unlock the hidden value of their staffing resources. Collaborative Staffing is a ground-up model that empowers employees to meet the staffing needs of the organization and ensure optimal patient coverage. Health systems using a Collaborative Staffing model, such as Hillcrest HealthCare System, have realized increased employee engagement and reduced labor costs.
During the next few weeks, we’ll be featuring a series of blog posts that take a closer look at how Collaborative Staffing works and what makes it successful. We’ll also discuss how Collaborative Staffing can help you avoid three common staffing pitfalls and showcase health systems that have found success with this approach.
1Accessed October 13, 2015. http://www.usnews.com/opinion/blogs/economic-intelligence/2012/08/09/how-collaborative-consumption-reinvigorates-our-economy
After consolidating six separate facilities into the Hillcrest Healthcare System, the Tulsa, Oklahoma-based organization lacked a singular staffing and scheduling system. This created several workforce-related challenges, including heavy use of premium labor such as unnecessary overtime and agency staff, ineffective use of the internal resource team, and inconsistent scheduling practices across the enterprise.
Jerry Yang, Associate Chief Financial Officer, and Jennie Bible, Division Resource Director at Hillcrest recently presented a webinar that detailed their success story, which is based on the creation of an internal resource pool to fill open shifts across the enterprise.
Their results include:
- $2 million in savings annually
- 83% open shift fill-rate average
- 90% satisfaction rate with the level of response and support from the internal resource pool.
Here’s a summary of the Q&A from that webinar:
Question: What’s your most successful method for recruiting nurses to be part of your internal resource pool?
Bible: Actually, our most successful method is our own nurses. Our nurses are PRN, and many of them have full-time positions in other, actually competing facilities. They love working for the resource team, and they go back to their facilities and send me excellent nurses from their competing facilities.
Question: Is your cost savings a result of reducing agency use, overtime, or a combination of both?
Bible: Mostly our reduction in cost is from reducing agency use. Definitely, we reduced overtime but I would say most of it is from reducing agency.
Question: Are most of your staff in the resource pool full-time or part-time staff?
Bible: All of our staff are PRN status. Their requirement and the standards are to work at least three shifts per month. However, many of them work three shifts a week so you would think that that would be considered like full-time but their status is PRN. They are non-benefitted.
Question: What is your actual cost per RN an hour?
Yang: Our nurses are paid on a premium, mostly because they are PRN and therefore there are no benefits so we do give a bump for that. So ultimately, they are roughly around $45/hour now.
Question: Can you explain a little bit more about self-directed floating? What exactly is it and how does it work?
Bible: We track staff qualifications in their profile. So when our staff look at open shifts in the system, they can see which shifts they are qualified to work, and then they can request those shifts. When they request the shift, a manager in another unit approves that shift. The manager in another unit can pull up their profile and see their experience. That way a person in our system can work in other units and get their hours. So, instead of having to use an agency when you have an open need, you can fill that shift with internal staff.
Question: In that pool, are all the PRNs working just for your system or do they potentially have positions elsewhere?
Bible: Well, if they are a resource person they work for me but they might have a job in other hospitals, yes.
Question: How do you onboard the nurses in that pool?
Bible: Our resource nurses all go through the same on-boarding process that any new-hire core employee does. We put them through hospital orientation at our large facility. Now, they do not go through six weeks of orientation like a new grad or anything, but they do go through hospital and nursing orientation.
Question: We had a question asking a little bit more detail about the software that you use. How much is the tool customized for you? Or is it customizable? Or is it sort of an out-of-the-box application that you are using?
Bible: Our tool is API ShiftSelect. Actually it is very customizable. You kind of build it yourself. I need to say it like that because it is very customizable depending on what you want for your facility and for your unit. And obviously API leads you through that process. They are building it, but you decide what you want for your customization: what you want for your hours, what you want for your competencies. It is very customizable. It is an amazing system and it can work for the smallest, tiniest little rural facilities to the largest metropolitan teaching facility – because we have it, we have the range.
Question: What method do you use to right-size the pool?
Bible: It depends on the needs that my facilities have. So if my facilities continue to have open needs that I am unable to fill, in other words if I am having to put out needs to agencies, then that’s how I right-size it.
Yang: Well just to be an open book, currently about 50% of what I call contract agencies, internal or external, it is split down the middle. So obviously we have still got 50% in opportunity so to say that we are right-sized – I will say we are nowhere close to it. Our goal is to increase another 10% of utilization in 12 months. So at this point we are still in a growth mode; we are trying to recruit as many nurses as possible into this program because this is so financially feasible. And, for us it makes sense for our quality level and culture-wise to have an internal agency instead of somebody from the outside who just comes in for a certain number of weeks. For our organization, every 10% bump in utilization is another a half a million dollar pick-up.
Question: How many FTEs do you have in your central staffing office?
Bible: If you’re talking about the clerks that I use to run my office, the answer is seven FTEs.
Question: Can you go into a little bit more detail about how you calculate that labor savings. Are you looking at the hourly rate of the internal resource versus what it would cost in a premium labor market?
Yang: That’s exactly how we calculate it. If we didn’t have the internal resource pool that we have today, the only alternative would be to use outside contracts and agency. The difference between the two rates is roughly around $15/hour. So the way we calculate it is $15/hour times that the number of hours that are filled by our internal agency resources because those are hours that we would have outsourced otherwise.
Question: A question about some compliance with the Affordable Care Act with part-time staff – if there are people working three of the 12-hour shifts a week, how are you sort of working through that compliance issue?
Bible: That is a really good question, and I would like to give a shout out to my HR director, who I believe is on the phone. They are handling that and we are on top of that. If those people have met their hours, we do offer them the insurance. We do have to drop their hourly rate to cover that, but we are meeting those standards as well.
Speaking of shout outs, a special thank you goes to Jerry and Jennie for taking the time to share their story. To learn more about Hillcrest Healthcare System’s successes, take a look at their case study.