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Improving lab productivity: top goal for the 1980s.

Make every dollar and every work hour count. Recent upheavals in the health care economy have sent that message loud and clear to clinical laboratory managers and supervisors. Better productivity must be a major objective if the laboratory, whether hospital-based or independent, is to survive prospective payment without cutting quality or quantity of service.

This complex topic is the focus of MLO's latest survey of our Professional Advisory Panel. Responses from our panelists, all laboratorians at the supervisory level or higher, mix grim and hopeful tidings.

Almost three quarters of the 305 respondents believe that DRGs will intensify current pressures to squeeze maximum results from minimum resources. The good news is that many laboratories are moving toward that goal. Despite the fiscal uncertainties of 1983, fully half of those surveyed reported increases in lab productivity over the year before, at an average rate of 13 per cent.

In this article, we'll examine the major problems in pinnning down accurate productivity records, and the chief obstacles to improving them. The article that follows will take a closer look at our panelists' range of imaginative strategies in getting the most from tight budgets and payrolls.

The first and most basic question we asked the panel was whether their laboratories measured productivity at all. More than three quarters said yes (Figure I). Hospital labs are much more active than others: 82.5 per cent of them measure productivity by some method, compared with only 47 per cent of independents. Labs at hospitals with less than 200 beds are somewhat less likely to track productivity than mid-size or large hospital labs.

Almost 80 per cent of the laboratories calculating productivity do it on a monthly basis. The remainder do so weekly (9 per cent) or on another schedule, such as annually or quarterly (12 per cent).

Even among laboratories with productivity records, it's hard to draw clear-cut conclusions with available statistics. As we'll see, collecting accurate productivity data is as challenging as using it effectively. The clinical laboratory is no mere assembly line: traditional methods for assessing industrial output offer little insight into the volume and intensity of the lab's workload.

Despite efforts to standardize this vital information, laboratories vary widely in techniques for productivity analysis. Some use a simple ratio of billable tests to staff size. Others work out elaborate formulas and time-motion studies. No one claims to have found the perfect system.

Time, for example, is a basic variable in any productivity equation. But what kind of time should form the basis for measurement--the total number of employee hours paid for, worked, or spent actually performing tests?

Some laboratories use all three figures for statistical comparison, as Figure I also shows. The most popular time measurement unit, used by 62 per cent of the labs surveyed, is total worked hours minus vacation, sick time, and holidays. Next come total paid hours, used by 57 per cent. Only 21 per cent measure output based on total specified or adjusted hours--work time minus all nontesting activities like administrative and supervisory tasks, research and development, instrument troubleshooting, and teaching.

Workload is the second main factor in the productivity numbers game. Here, too, a broad range of systems is used to quantify technologist output. The simplest gauge--a raw count of tests performed--is hardly an accurate yardstick. Obviously, the test that whizzes through an automated analyzer consumes a fraction of the labor required for a lengthy culturing procedure. Simple test tallies also ignore a host of vital nontesting activities, from answering the telephone to cleaning up the work space.

This dilemma prompted the College of American Pathologists to develop its workload recording method, which assigns a unit value to every testing procedure based on averages determined by volunter time studies performed in labs across the nation. In theory, the CAP unit value expresses the minutes of technical, clerical, and aide time required to complete a procedure once.

Despite its flaws, the CAP workload recording method is used by 86 per cent of all surveyed labs (Figure II). An overwhelming 92 per cent of hospital laboratories employ it, compared with 40 per cent of independent labs. This perhaps reflects the less regulated atmosphere outside the hospital setting.

Widespread use doesn't translate into universal popularity for the CAP system. Overall, CAP workload reporting receives moderate grades from the panel, with scattered strong complaints. Just half the respondents rate its effectiveness as good; 36 per cent find it fair. Only 10 per cent call it very good but fewer label it poor.

Several panelists express frustration at CAP's efforts to keep the system current with fast-developing laboratory technologies. Sandra Jarvinen, chief technologist at 200-bed Doctors Hospital in Lake Worth, Fla., says: "There are no unit values for many of our new automated instruments, and that's a serious limitation. If it is to continue as a recognized standard, the CAP method must be updated fast--especially now, when laboratories need accurate data more than ever to fight proposed staff cuts under DRGs."

On the other hand. CAP's yearly efforts to update its method can also result in exasperation. In a number of surveyed labs, productivity fell by several points in 1983--on paper, at least--just because of revised unit values. Affected managers point out the difficulty of making accurate year-to-year comparisons with an ever-changing standard.

Survey participants also fault the method's accuracy in many situations. "CAP workload recording is only statistical average, and it's more or less appropriate depending on your workload." That's the view of Barbara Caro, laboratory manager at 376-bed Providence Medical Center in Seattle, Wash. "If you have a small volume of testing, the units don't really reflect the amount of work needed--and if volume is unusually high, you come out looking very well."

Julie Ann Brown, radiochemistry supervisor at 558-bed St. Joseph Mercy Hospital in Ann Arbor, Mich., has similar concerns. "Unfortunately, it's the only system we have to measure productivity, and it just doesn't seem adequate. It certainly doesn't account for all the specialization in our area, which performs some of the more esoteric tests requiring more physician contact. CAP units don't always reflect that."

"These days, you need to know what's happening to productivity by the hour, not just by the month or the week," according to Elizabeth Jenkins, admininstrative director of the laboratory at 400-bed Mary Hitchcock Memorial Hospital in Hanover, N.H. "And while CAP workload recording can give you the big picture, it's not precise enough to help determine within-day staffing patterns."

Despite these reservations, respondents rely heavily on the CAP method for an array of important management tasks (Figure III). Most notably, 84 per cent use it to project staffing needs, while almost 70 per cent use it for budget planning. About half use CAP units to evaluate instrumentation needs, and to compare output with other laboratories and other sections of their own laboratories.

A third of those surveyed compare test methodologies with CAP data: 40 per cent use it to determine and allocate costs: and more than 20 per cent use it to monitor employee performance. David Childers, department head of pathology at 331-bed St. Joseph Hospital in Reading, Pa., comments: "CAP units don't always represent the ideal for a given procedure. But comparative statistics are absolutely critical. At least we're all using the same index, regardless of whether a CBC takes exactly the time they assign to it."

The CAP system isn't the only game in town--at least not for the 22 per cent of our panelists who invented their own productivity measurement system. More than 60 per cent of the independent laboratories chose this approach (Figure IV), compared with only 17 per cent of all hospital labs.

"We dropped CAP workload recording a year and a half ago, after being avid users for five years." Paul Goodman, M.D., lab director at 200-bed William Beaumont Hospital in Troy, Mich., reports. "Our main reason was the paperwork, an excessive and costly burden on our technologists and clerical staff." His laboratory now measures financial performance based on billable tests.

"When we were using the CAP system." Goodman says, "we always had satisfactory productivity calculations, so we were comfortable that we had a good baseline." The lab retains CAP units for instrument justification studies, and for recording specimen collection workload.

At Providence Medical Center, laboratory computer specialist helped develop a program that assesses labor and supply costs per test, and tests per admission and per patient day. "The system allows us to justify more expensive reagents, for instance, if they reduce labor costs," Barbara Caro says.

The computer also tracks workload from month to month, an important aid to scheduling. "When a position opens up," Caro says, "we can see whether we need a full-time employee or two parttimers, and know where each parttime person will serve us best." The hospital now plans a program that will track test volume by diagnosis as well.

What do these monitoring effects reveal about lab productivity? For 50 per cent of our panelists, last year's statistics showed that productivity rose from 1982 (Figure V). It remained unchanged for 28 per cent, and went down for 22 per cent. This split varied little for hospital and independent laboratories.

As we noted earlier, in laboratories where productivity went up it did so by an average 13 per cent. The average drop elsewhere was 10 per cent; Panelists with more productive labs attributed the change to a variety of causes, from employee effort to staff cuts.

The most common boosters, though, were increased test volume, cited by 25 per cent of those who improved productivity; better or more modern equipment (22 per cent); and better scheduling or management (20 per cent). Among labs that produced less, 20 per cent blamed a lower patient census, while 17 per cent pointed to technical changes in CAP unit values. These are specific 1983 factors. We'll look at broader productivity obstacles in a moment.

When asked to name their laboratory's most productive section, 53 per cent choose chemistry--not surprising, given the advanced degree of automation in this area. Hematology and microbiology are named most productive by 16 and 15 per cent respectively.

The blood bank is the least productive lab area, according to 26 per cent of those surveyed, with microbiology (22 per cent) and immunology (21 per cent) ranking second and third for that dubious achievement. As several panelists note, such comparative figures can be a misleading gauge of employee efficiency and managerial skill. "Apples and oranges" is how one supervisor described attempts to relate productivity figures for a section devoted to lengthy manual procedures to those for an area geared to rapid, high-volume testing.

The future under prospective payment will make these issues more urgent than ever. Figure VI shows that while 18 per cent feel they will be unaffected by DRGs, 71 per cent expect the new Medicare changes to intensify productivity pressures. Curiously, concern on this issue runs highest in the Midwest, where 82 per cent of those questioned anticipate greater pressure, followed by 72.5 per cent in the South. Concern is less prevalent in the East (66 per cent) and West (68 per cent). for many laboratories, prospective payment may mean doing more work with fewer people. Almost half the respondents expect staff cuts as a result of DRGs. Again, a higher percentage of Midwestern laboratories (54 per cent) are bracing for staff cuts than their colleagues in other areas.

In meeting the challenge, laboratory management faces a formidable range of impediments to efficient use of of scarce resources. What holds down productivity in our panelists' labs?

The biggest obstacle, say 64 per cent, is the perennial problem of Stat abuse, followed hard by a related headache: inefficient test ordering patterns, mentioned by 58 per cent (figure VII). These two factors alone demonstrate that any effective productivity campaign will have to extend beyond the laboratory to include the medical and nursing staffs.

Regulatory requirements are the leading time waster for more than a third of the panel. Understaffing and poor motivation plaque almost a third. Some 27 per cent each are fighting the effects of low test volume, budgetary constraints, and poor internal and external communication.

Roughly a quarter of those surveyed say they are losing productivity to teaching and other nontesting activities, inappropriate staffing patterns, poor work environment, low salaries, inadequate instrumentation, or hospital administrative policies. And 12 to 13 per cent cite overtime, needless meetings, instrument downtime, and case mix as part of the problem.

Our respondent panelists, however, are determined to be part of the solution. In the next article, we'll take a look at some of the more innovative approaches they are taking.
COPYRIGHT 1984 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1984 Gale, Cengage Learning. All rights reserved.

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Title Annotation:special report - part 1
Author:Becker, Brenda L.
Publication:Medical Laboratory Observer
Date:Mar 1, 1984
Words:2110
Previous Article:Despite ongoing challenges, pathologist reimbursement rules take effect.
Next Article:Improving lab productivity: the search for strategies.
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