Addressing rising staffing costs: five ways you could be saving money

If, like many healthcare organisations, you’re seeing staff costs rising, you may be looking for ways to reduce those costs without compromising patient care. In a perfect world, the same solution to rising staff costs could also help improve rostering so patients always had access to appropriately-trained professionals.

Far from being a daydream, this scenario is actually possible with the right approach.

Staffing costs are affected by so many different factors, it can be hard to know where to start. But one thing’s for sure: we know costs are going up, and we know that salaries and wages make up 61 per cent of those costs.[1] So any savings in staff costs are likely to have a big impact on overall costs.

Data is the key

The right data, and the insights it can deliver, can help you establish benchmarks and improve your understanding of where changes are needed.

According to Healthcare Financial Management Association report, Rising staff costs: Uncovering the barriers for Public Hospitals and Health Services 2016, there are five key areas that, managed well, can contribute to cost savings and improved operations:

1. Better matching patient care needs to staffing requirements

Making practices more flexible can deliver economic benefits. For example, it may be possible for less expensive, yet qualified, staff to do some tasks that are currently done by more expensive, more highly-qualified staff. This would free up highly-qualified staff to complete more specialised activities.

2. Creating more flexible rosters and staff resources

If you can’t easily move staff around in response to daily changes in patient workload or staff absence, you’ll end up being over- or under-staffed. Overstaffing costs money and understaffing can, in some cases, compromise patient care. Neither is desirable, so it’s important to introduce flexibility and to employ staff according to the workload, not the budget.

3. Reducing nurse absenteeism

Nurses make up the largest body of employees in the healthcare system, with over 307,000 staff [2] and have the highest numbers in staff absenteeism, which can become an organisational issue. If you’re seeing nurses take a lot of unplanned time off, and productivity is going down, then there may be deeper issues in your workplace that need to be addressed.

It’s essential for healthcare providers to understand what’s driving nurse absenteeism, then take steps to address those issues. For example, nurses may benefit from more flexible rosters, an opportunity to work part-time, more control over their shifts, or more support.

4. Developing fairer, more accurate rosters

Rostering is an incredibly complex task that’s made more difficult by manual processes. Combine that with unplanned time off and the inevitable last-minute requests to switch shifts, take time off, or not work with certain colleagues, and it becomes a herculean task to create a roster that suits everyone and meets the organisation’s needs.

By gathering data and using a streamlined, automated system for rostering, you can automatically roster people for shifts that suit them, and match their skills to patient needs rather than simply rostering on the people who are available, then hoping for the best. This type of system can also help address underlying issues that result in absenteeism, such as providing more flexibility for people to attend to personal or family needs.

5. Improving staff retention

In general, the further a site is from a large metropolitan centre, the harder it is to recruit and retain staff, which often means you need to offer higher salaries to attract the right talent. High staff turnover also costs money, both in recruitment and training costs, and in the time it takes to get new staff up to speed.

What you can do from here

You need access to good data, and the insights it delivers, to identify issues, develop interventions, and evaluate the impact of those actions.

Good data is near real-time so the insights and actions are timely. It needs to focus on the right areas so any actions can have a measurable impact. And the collection of the data needs to be repeatable so benchmarks can be set and changes can be measured.

The next step for organisations looking to trim costs is to access and use more and better data for decision-making, particularly regarding workforce management.

For more information on how Allocate can help you unlock significant financial savings through best of breed and proven award interpretation, payroll integration and effective time and attendance functions, please contact us today.

Download our Whitepaper: Rising Staff Costs in Hospitals and Health Services

[1] Australian Institute of Health and Welfare – AIHW (2012). Australian hospital statistics 2010–11. Health Services Series no.43. Cat. no. HSE 117. Canberra: AIHW.

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