Part III: Tools to Analyze Financial Operations
Part III: Tools to Analyze Financial Operations
CHAPTER 9: STAFFING: THE
MANAGER’S RESPONSIBILITY
Staffing Requirements
• In Health Care, many positions must be filled, or covered, 7 days a week, 24 hours a day.
Productive and Non-Productive Time
• Why annualize?
• Employees are paid for more hours than the hours they are on duty (vacation days, etc.), so
• Annualizing allows the full cost of the position to be computed through a “burden” approach.
Productive and Non-Productive Time
• Productive Time — Represents the employee’s net hours on duty when performing the functions in his/her job description
• Non-Productive Time — Represents the paid- for time when the employee is not on duty and not performing his/her job description functions
– Includes paid-for vacation days, holidays, personal leave days and/or sick days
Productive and Non-Productive Time
• Exhibit 9-1 illustrates:
• Productive Time — (net days when on duty)
• Non-Productive Time — (additional days paid for but not worked)
• FTE Definition for purposes of understanding annualizing positions:
• The equivalent of one full-time employee paid for one year, including both productive and non-productive time.
• Two employees working half-time for one year would be the same as one FTE.
FTEs for Annualizing Staff Positions
FTEs for Annualizing Staff Positions
• The calculations to annualize staff positions is a two-step process:
1. Compute the net days worked.
2. Convert the net paid days worked to a factor.
• See Exhibit 9-2 as an example.
Number of Employees Required to Fill a Position
• Why calculate by position?
– Computing by position is used in controlling, planning and decision-making.
• The scheduled position method is often used when forecasting new programs and services.
• You will also find scheduling software using this method.
Number of Employees Required to Fill a Position
• FTE definition for purposes of filling a scheduled position:
• A factor expressing the number of employees required measured against, or the equivalent of, one full-time employee’s standard work week.
Number of Employees Required to Fill a Position
• The calculation to fill scheduled positions is as follows:
• Compute the number of hours for a full-time position filled for one year. This measure is the baseline.
• Compute a factor representing the position to be filled for the required number of days (a required seven-day week to cover, for example, versus a five- day work week equals a factor of 1.4).
• See the cast room example in the text.
Tying Cost to Staffing
• In the case of the annualizing method the cost of nonproductive days is already in the formula.
• So, multiply the factor times the base hourly rate to compute cost.
• Study the example in the chapter.
Tying Cost to Staffing
• In the case of the scheduled position method the base rate must be increased, or burdened, by the nonproductive time.
• First, increase the hourly base rate by a percent or factor that represents the nonproductive time. Then multiply the burdened based rate by the factor to compute the cost.
• Then, multiply the factor times the base hourly rate to compute the cost.
• Examine the examples in the chapter.
Tying Cost to Staffing
• The actual cost is attached to staffing in the books and records
• Using a subsidiary journal and
• A basic transaction record
• Both of which are more fully described in another chapter
Tying Cost to Staffing
• An example of a subsidiary journal is the Payroll Register illustrated in Exhibit 9-5
Tying Cost to Staffing
• An example of a basic transaction record is the time card illustrated in Exhibit 9-6
• (Of course this time card format will probably be computerized.)
• In summary, hours worked and pay rates are essential ingredients of staffing plans, budgets and forecasts
• And appropriate staffing is the responsibility of the manager
Tying Cost to Staffing
Exhibit 9–3 Master Staffing Plan for Nursing Unit
Calculation for Annualizing Master Staffing Plan Example
Total Days in Business Year
Less two days off per Week
Number of Paid Days per Year
RN
364
104
260
LPN
364
104
260
NA
364
104
260
Less Paid Days Not Worked:
Holidays
Sick Days
Vacation Days
Education Days
Net Paid Days Worked
9
7
15
3
226
9
7
15
2
227
9
7
15
1
226
Step 1: Compute Net Paid Days Worked
Calculation for Annualizing Master Staffing Plan: Example
Step 2: Converting Net Paid Days Worked to a Factor
RN
LPN
NA
364
226 = 1.6106192
364
227
364
228
=
=
1.6035242
1.5964912
FTEs to Annualize Staffing: Assignment Exercise 9-1
Compute Net Paid Days Worked Laboratory Medical Records
Total Days in Business Year
Less Two Days off Per Week
Number of Paid Days Per Year
_________
_________
_________
________
________
________
Less Paid days Not Worked
Holidays
Sick Days
Education Days
Vacation Days
Personal Leave Days
_________
_________
_________
_________
_________
________
________
________
________
________
Net Paid Days Worked
________
________
_______
_______
Covert Net Paid Days Worked to a Factor:
For the Lab.
Total days in business year divided by net paid days worked = factor _______________
For Medical Records
Total days in business year divided by net paid days worked = factor _______________
Compute Net Paid Days Worked Laboratory Medical Records
Total Days in Business Year
Less Two Days off Per Week
Number of Paid Days Per Year
364
104
260
364
104
260
Less Paid days Not Worked
Holidays
Sick Days
Education Days
Vacation Days
Personal Leave Days
9
7
3
15
0
9
0
0
0
21
Net Paid Days Worked
34
226
30
230
Covert Net Paid Days Worked to a Factor:
For the Lab.
Total days in business year divided by net paid days worked = factor 364/226 = 1.610619
For Medical Records
Total days in business year divided by net paid days worked = factor 364/230 = 1.582609
FTEs to Fill Position Example (Exhibit 8-4): 8 Hour
Emergency Department Scheduling for Eight-Hour Shifts:
Shift
One
Day
Shift
Two
Evening
Shift
Three
Night
=
24-Hour
Scheduling Total
Position:
Emergency Room
Intake
1 1 1 =
Three Eight-
Hour Shifts
Staff needed to
cover position 7/24 1.4 1.4 1.4 = 4.2 FTEs
One full time employee works 40 hours per week. One eight-hour shift per
day times seven days per week equals 56 hours on duty. Therefore, to cover
seven days or 56 hours requires 1.4 times a 40 hour employee.
FTEs to Fill a Position: Practice Exercise 9-II: 8 Hour
Scheduling for Eight-Hour Shifts:
Shift
One
Day
Shift
Two
Evening
Shift
Three
Night
=
24-Hour
Scheduling
Total
Position:
Admissions Officer 2 1 1 =
Four Eight
Hour Shifts
FTEs to cover position equals 2.8 1.4 1.4 = 5.6
Position
Clerical
1 0 0 = One Eight
Hour Shift
FTEs to cover position equals 1.4 0 0 = 1.4
Scheduling for Eight-Hour Shifts:
Shift
One
Day
Shift
Two
Evening
Shift
Three
Night
=
24-Hour
Scheduling
Total
Position:
Admissions Officer =
Four Eight
Hour Shifts
FTEs to cover position equals =
Position
Clerical
= One Eight
Hour Shift
FTEs to cover position equals =
Health Care Finance by Judith J. Baker and R.W. Baker.
Copyright © 2011 by Jones and Bartlett Publishers, LLC
FTEs to Fill a Position: Assignment Exercise 9-2:
8 Hour Scheduling for Eight-Hour Shifts:
Shift One
Day
Shift Two
Evening
Shift Three
Night =
FTEs Seven
Day Week
Position:
Nursing Supervisor
Technician
Nurses
Clerical
Aides
2.8
2.8
4.2
1.4
1.4
1.4
2.8
2.8
0
0
1.4
1.4
2.8
0
0
= 5.6
7.0
9.8
1.4
1.4
Total FTEs needed to cover all shifts 25.2
FTEs to Fill a Position: Example 12 Hour
Emergency Department Scheduling for Twelve-Hour Shifts: 36 Hour
Week
Shift
One
Shift
Two =
24-Hour Scheduling
Total
Position:
Emergency Room Intake 1 1 =
Two Twelve
Hour Shifts
Staff needed to cover
position 7/24 2.33 2.33 = 4.66 FTEs
One full time employee works 36 hours per week. One twelve-hour shift per day
times seven days per week equals 84 hours on duty. Therefore, to cover seven
days or 84 hours requires 2.33 times a 36 hour employee.
FTEs to Fill a Position: Assignment 12 Hour
Scheduling for Twelve-Hour Shifts: 36 Hour Week
Shift One Shift Two = FTEs Seven Day Week
Position:
Nursing Supervisor
Technician
Nurses
Clerical
Aides
4.66
2.66
7
1.4
2.33
2.33
4.66
4.66
0
0
= 7
9.33
11.66
1.4
2.33
Total FTEs needed to cover all shifts 31.75
FTEs to Fill a Position: Example 12 Hour
Emergency Department Scheduling for Twelve-Hour Shifts:
48 Hour Week
Shift
One
Shift
Two =
24-Hour Scheduling
Total
Position:
Emergency Room Intake 1 1 =
Two Twelve Hour Shifts
Staff needed to cover
position 7/24 1.75 1.75 = 3.5 FTEs
One full time employee works 48 hours per week. One twelve-hour shift per day
times seven days per week equals 84 hours on duty. Therefore, to cover seven
days or 84 hours requires 1.75 times a 48 hour employee.
Health Care Finance by Judith J. Baker and R.W. Baker.
Copyright © 2011 by Jones and Bartlett Publishers, LLC
FTEs to Fill a Position: Assignment 12 Hour
Scheduling for Twelve-Hour Shifts: 36 Hour Week
Shift One Shift
Two = FTEs Seven Day
Week
Position:
Nursing Supervisor
Technician
Nurses
Clerical
Aides
3.50
3.50
5.25
1.4
2.33
1.75
3.50
3.50
0
0
= 5.25
7
8.75
1.4
2.33
Total FTEs needed to cover all shifts 24.73
