Editor's note: This is Part 7 of a 12-part series focused on optimizing medical group financial performance. Each brief in this series takes 2 to 3 minutes to read and identifies specific actions medical groups can take to achieve sustainable financial improvements.
Assessment
Apart from provider compensation, workforce staffing is typically the largest single contributor to physician enterprise expenses. Prudent management requires continuous vigilance in two areas of resource management: staffing levels and pay per hour.
To determine the staffing level opportunity, calculate the difference between the actual minutes per encounter and the benchmark. Then multiply the difference by the number of encounters to get the total excess minutes. Divide the total excess minutes by 60 and multiply the result by the average hourly rate to identify the dollar value of this opportunity.
(Note: The benchmark for this metric is typically calculated by converting the industry benchmarks on FTE per 100 encounters to staff minutes per encounter. This conversion creates a more actionable KPI for the organization.)
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