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Hospital Labor Productivity Management Services

The management of labor in the hospital environment is a process that truly requires day-to-day oversight by the hospital leadership team. Salary, wages and benefits are the most significant operating expenses for a hospital trying to improve financial performance. CHC Consulting’s approach for productivity, customized for rural and community hospitals, brings just what’s needed to make staffing effective for quality care delivery.

There is no question that hospitals are challenged with increasing costs and tighter margins. The goal of productivity is to ensure each hospital department has the right level of staffing to provide quality care. By establishing a productivity budget and then staffing to a budget number, the hospital can deliver excellent patient care while reducing costs and increasing efficiency. 

How to Implement Productivity Management

One of the most important aspects of productivity implementation is involving the right people from the beginning. Participants should include community hospital executives and front-line departmental managers. The role of the executive team is to set financial targets for each department that roll up to the top-line hospital budget. The department managers then become involved to determine the level of staffing needed to meet these targets. During this process, department managers need education about the reasons for and benefits of productivity management. 

The staffing targets are established based on both internal historical data and industry benchmarks. Each hospital department uses specific utilization metrics to determine the staffing levels needed. Examples of utilization statistics include patient days, lab tests or surgical procedures. After the optimal ratio of hours worked to the utilization statistic is defined, the departmental manager tracks departmental volumes and schedules staff based on current and predicted volumes. In cases where the department begins to be more or less busy than projected, the manager will adjust staffing to keep the productivity ratio in check.


  • We compare productivity across smaller hospitals like yours to establish benchmarks relevant to your hospital’s unique needs and staffing challenges.
  • We take into account shared staffing, changes in service line operations, and other challenges unique to your local hospital, so leadership can manage to department-specific and hospital targets.
  • The CHC Productivity Tool™ is easy to understand, simple to use, and integrates a level of accountability toward helping to control labor expenses.
  • Our experts can help ensure your productivity management aligns to your action plans and budget goals.

We Want to Help

CHC Productivity Services range from a desktop productivity assessment to productivity planning and full support. Contact us today to learn how we can help your hospital.

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Hospital Cost Reduction Depends On Productivity Management


Because labor costs are the largest operating expense for hospitals, managing staffing is a critical day-to-day process. Unfortunately, rural and community hospitals often lack the tools to monitor workload and measure productivity. As a result, labor expenses become a larger proportion of operating revenue and a key target for hospital cost reduction.

The productivity tool helps executive leadership to effectively manage labor resources and fulfill organizational goals.

The goal of productivity management is to make staffing appropriate and effective for high quality patient care. The good news:...

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