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To Cut Costs, Motivate Nurses, Take a Cue From Airlines

Karen Minich-Pourshadi, for HealthLeaders Media, July 16, 2012

Why do I share this story? Well, what are you doing to motivate staff without spending too much? What if you tested this idea with your nursing staff. This team comprises a huge chunk of your labor budget, but some of that expense can be trimmed with a bit of ingenuity. Unquestionably, shifts must be filled, but not necessarily with agency nurses or incentive payments.

Those costs can be avoided.

Two years ago St. Francis Hospital in Columbus, GA, realized it needed to address a nursing cost and scheduling problem. Like any hospital, St. Francis, a not-for-profit, 376-bed community hospital was looking at how to lower its costs without reducing the quality of care. But the nurse labor budget was on the rise. What's more, the nurses weren't particularly happy with the scheduling system. Nurses were made to float between units when they didn't want to. Moreover, the hospital was paying loads in overtime and incentive payments to cover extra shifts or relying on expensive agency nurses to fill in the gaps.

If this scenario sounds like one you're dealing with at your hospital, you're not alone.  At the Healthcare Financial Management Association conference in Las Vegas last month, I spoke with several financial leaders who bemoaned that they need help addressing how to:

  • Reduce the nurse labor expense without sacrificing quality of care
  • Optimize nurse schedules for maximum cost savings, and
  • Drastically cut the need for staffing agency nurses
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