BestPracticesin

Hospital Key Financial Indicators

HospitalKeyFinancialIndicators
SettingandAchievingGoals
Steven Berger, CHE, FHFMA, CPA
President
H lth
Healthcare
Insights,
I i ht LLC
510 Roosevelt Drive
Libertyville, IL 60048
847-362-1244
E-mail: sberger@hcillc.com
www.hcillc.com
1

About the Presenter

AboutthePresenter
StevenBergerisPresidentofHealthcareInsights,LLC,whichspecializesintheteachingandconsultingof
healthcarefinancialmanagementissues.Inaddition,HealthcareInsightshasdevelopedINSIGHTS,amanagement
y
pp
y
accountabilityanddecisionsupportsoftwaresolutionforthehealthcareindustry.PriortohisroleatHealthcare
Insights,Mr.BergerwasVicePresident,Financeforsevenyearsat250 bedHighlandParkHospitalinsuburban
Chicago,Illinois.BeforeHighlandParkHospitalandsince1978,hehasbeenahospitalorhealthsystemfinanceofficer
inNewYork,NewJerseyandMissouri.
Mr.Bergerhasover30yearsofhealthcarefinancialmanagementexperience.HeholdsaBachelorsofSciencedegree
inHistoryandaMasterofScienceinAccountingfromtheStateUniversityofNewYorkatBinghamton.HeisaCPA,a
FellowoftheHealthcareFinancialManagementAssociation(FHFMA)wherehehasservedasPresidentoftheFirst
IllinoisChapter.Mr.BergeralsoservedathreeyeartermontheHFMAsNationalBoardofExaminersandwasrecently
theRegionalExecutiveofRegion7oftheHFMA.HeisalsoaFellowoftheAmericanCollegeofHealthcareExecutives
(FACHE).
Inaddition,overthepastseveralyearshehaspresentedmanyhealthcarefinancerelatedseminarsthroughoutthe
U i dS
UnitedStatesandCanadaincludingseveraltwodayclassessuchasFundamentalsofHealthcareFinancial
dC
d i l di
l
d l
h F d
l fH l h
Fi
i l
Management,TurningDataintoUsefulInformationandHospitalFinancialManagementfortheNonFinancial
Manager.HehasalsobeenpublishedseveraltimesinHealthcareFinancialManagementmagazine,includingan
August2004NationallyAwardWinningarticleontheTenWaystoImproveCostManagementinHospital,anApril
2002managementcolumnandaFebruary2000commentaryinModernHealthcareonthelackoftraininginthe
healthcareindustry
Additionally,Mr.BergeristheauthorofFundamentalsofHealthcareFinancialManagement,originallypublished
in1999byMcGrawHillandtheHealthcareFinancialManagementAssociation.Thisbookwaswrittenfroma
practitionerspointofviewandisadistillationofMr.Bergersmanyyearsontheinsideofhealthcareinstitutions.The
thirdeditionofthebookwaspublishedinJanuary2008andisavailableatwww.josseybass.com.Additionally,Mr.
Bergercoauthoredthe2002text,HFMAsIntroductiontoHospitalAccounting,4thedition,publishedbyKendall
Bergerco
authoredthe2002text, HFMAsIntroductiontoHospitalAccounting,4thedition ,publishedbyKendall
Hunt,availableatwww.hfma.org.Mr.Bergers2003book,UnderstandingNonprofitFinancialStatements,was
publishedbyBoardSourceandisavailableatwww.boardsource.org.Hislatestbook,ThePowerofFinancialand
ClinicalMetrics:AchievingSuperior ResultsinYourHospitalwaspublishedinMarch2005andisavailableat
www.ache.org.
2

ObjectivesoftheCourse
y Hospitalexecutiveshaveahardjobtodo!
y Inattemptingtocreateandachieveaneffectivestrategicplan,thereisagreatneedto

determinespecificoutcomesthatwillbeconsistentwiththeorganization'sunderlying
mission,broadpolicies,cultureandacceptedindustrynorms.
y Butwhatexactlydoesthismean?
y Whataretheelementsthatwillbeinstantlyrecognizableas"a"or"the"keyperformance
indicators(KPIs)ofsuccessacrossthehospitalindustry.
y Thisclasswillhighlighttheresultsofresearchwithseveralhospitalsthathave
undertakentodevelopthepropermetrics,sethighgoalsandensurethatthesegoalshave
p
p p
g g
g
beenmet.
y LEARNINGOBJECTIVES:
y Understandtheneedtoutilizekeyperformanceindicatorsindaily,biweekly,monthly,
quarterlyandannualreporting.
quarterlyandannualreporting
y Recognizethekeyperformanceindicatorsthatarebeingusedatseveralotherhospitalsto
achieveimprovedfinancialresults.
y LearnthebestwaystopresenttheKPIsforeffectivemanagementoutcomes.

Objective#1
UnderstandingtheNeedtoUtilize
K P f
KeyPerformanceIndicatorsinDaily,
I di t i D il
Biweekly,Monthly,Quarterlyand
y
y
y
AnnualReporting
4

What are
Whatare
KeyPerformanceIndicators(KPIs)?
y KeyPerformanceIndicators(KPIs)aredefinedas

measuresormetricsthathavebeenchosen,byan
organization sleadershipteam,asrepresentativeof
organizationsleadershipteam,asrepresentativeof
themostimportantoutcomestobeachieved
y KPIsaredevelopedtomeasuretheresultsof
organizationalpolicies,practicesandprocedures
i i
l li i
i d
d
y KPIsrepresentkeydriverandcriticalsuccessfactors
totheorganization
y Theorganizationneedstomonitortheresultsof
theseperformancemetricstodeterminethequality
ofitsfinancialoperations
fit fi
i l
ti
5

How Can KPIs Be Used

HowCanKPIsBeUsed
toDetermineFinancialQuality?
y KPIsallowstheorganizationto
y Recognizekeyorganizationalsuccessdrivers
y Setthelevelofthesedrivers(goals)
y

Mostoftenthroughstrategicandoperationalbenchmarking

y Manageforachievementofthesegoals
y Fosteraccountabilitythroughtherecognitionofthe

achievement
y Setpayandbonuslevelsbasedongoalsandoutcomes

How Do Best Practice Hospitals Use

HowDoBestPracticeHospitalsUse
KPIsinTheirOperations?
y BestPracticeHospitals
y Utilizeasetofnumbers(metrics)representingkeysuccess
factors
y Setgoalsthroughobjectivelyderivedbenchmarks
y Monitorthegoalsinavalueaddedmanner
y
y
y
y
y
y

Daily
W kl
Weekly
Biweekly
Monthly
Quarterly
Annually

y Takeappropriatemanagementactionsasaresultofthe

achievementorlackthereof.

What Do Best Practice KPI

WhatDoBestPracticeKPI
HospitalsDoDifferently?
y BestPracticeHospitals
y Usemanytoolsandtechniquestosetandmonitorgoals
y Paygreatattentiontothedetailedoutcomes
y Employabestpracticesorientationthroughthe
utilizationofpeerbenchmarks
y Applymanagementtechniquesincluding:
y
y

Accountabilityformeetinggoals,and
positiveandnegativeconsequences

y Achieveoutcomesfarinexcessoftheaverage

WhataretheValuesoftheKPIs?
y TheKPIsprovidesignificantvaluetoanyorganizationthat

utilizesthemto
y Choosethemostimportantindicatorsfortheorganization
y Setthegoals(usingbenchmarks)
y Createactionplanstoachievethegoals
y Implementtheactionplans
y Monitortheresultsoftheimplementation
y Communicatetheresultsbacktotheaffectedparties(Feedback)
C
i t th
lt b kt th ff t d ti (F db k)
y Developmentpositiveandnegativeconsequencesbasedonthe

results
9

SuccesswithKPIs
y Inthe1970sandearly1980s,Humanacorporateofficemandated

severaltargetsthattheindividualhospitalCEOshadtomeetin
ordertogetbonusesandstock
y TheCEO
TheCEOshadtargetsfor
shadtargetsfor
y Budgets
y Censusdayvolumes
y Profitmargins

y Becausethesegoalswereconsistentlymet,
y Humanahospitaladministratorswereknownasthebestpaid
y 9
,
administratorsintheearly1980s,and
y In1987,ofthe40hospitalswiththehighestoperatingprofit
margins,17wereHumanafacilities,accordingtoastudybyHCIA.
y 22oftheremaining23hospitalsonthelistwerealsoinvestor
owned
owned.
Source: Columbia/HCA: Healthcare on Overdrive, Sandy Lutz and
E.Preston Gee, McGraw Hill, page 15.

10

How Other Industries Use KPIs to

HowOtherIndustriesUseKPIsto
AchieveSuperiorResults
y Everyindustryhaskeyperformanceindicatorsthat

representsuccessfactors.Forexample,
y Airlines
Ai li
y

Revenueperpassengermile

y Steel
y

Metrictonsofsteelproduced

y Retailing
y

Salespersquarefoot

11

Objective #2
Recognizing the Key Performance
I di t
Indicators
That
Th t are Being
B i Used
U d att
Several Other Hospitals
p
to Achieve
Improved Financial Results
12

KPIElements
y KPIscomeinsomanydifferenttypes
y EveryorganizationislikelytochoosedifferentKPIs
y KPIs,bythenatureoftheirusefulness,willaffectedbya
KPIs bythenatureoftheirusefulness willaffectedbya

varietyoffactors
y Location
y Urban,suburban,rural,state
Ub b b
l
y Payermix
y Medicare,Medicaid,ManagedCare,SelfPay
y Taxstatus
y Forprofit,notforprofit,governmental,military
y Reportingperiods
y Daily,weekly,biweekly,monthly,quarterly,annually
13

Daily KPIs
DailyKPIs
HospitalWideVolumeIndicators
y Inpatient
y Patientdays
y Averagelengthofstay
y Admissions
Ad i i
y Discharges
y Transfers
y Revenues(GrossCharges)
y Outpatient
y Visits
y Tests
y Procedures
y Modalities
y Revenues(GrossCharges)
14

Daily KPIs
DailyKPIs
DepartmentLevelWorkloadUnits
y Someimportantdepartmentalworkloadunitsare:
y Nursing(Medical/Surgical,CriticalCare,Telemetry,Maternity,Etc.)
y
y
y
y
y

PatientDays
AdjustedPatientDays
SeverityAdjustedPatientDays
Admissions,Discharges,Transfers
SeverityAdjustedADT

y Radiology,Laboratory,Cardiology
y Tests
T
y Procedures
y RelativeValueUnits(RVUs)
y RehabilitationServices(Physical,Occupational,SpeechTherapies)
y Procedures
P
d
y Modalities
y SurgicalSuite
y Cases
y SeverityAdjustedCases
y MinutesPerCase

15

Baldrige and Top 100 Winner Case Study

SSM Health Care

1
3
4
4
0
1
3
0
3
1
1

0
2
1
1
2
2
1
3
1
0
0

43
42
14
54
42
42
35
42
20
13
52

21

13

399

Month to Date Budget

Variance

Month Budget

LO
(B
S
as E
ed D
on V i
s
C its
ha
O
rg
ut
es
pa
Po
tie
st
nt
ed
R
)*
eg
ist
r
at
In
io
pa
ns
tie
*
nt
Su
rg
er
O
ie
ut
s*
pa
tie
nt
Su
rg
er
ie
To
s*
ta
lS
ur
ge
ri
O
es
pe
n
H
ea
rt
Su
rg
er
ie
C
s
ar
di
ac
C
at
hs
In
pa
tie
nt
R
ev
en
ue
O

C
um
ul
at
iv
e

tC
en
su

A
dm
iss
SC
N

Pe
ds
+
+

M
id
ni
gh

io
iss
A
dm
A
du
lt

ds
A
Pe

1
Saturday 2
S d 3
Sunday
4
5
6
7
8
Saturday 9
Sunday 10
11
12
13
14
15
Saturday 16
Sunday 17
18
19
20
21
22
Saturday 23
Sunday 24
25
26
27
28
29
Saturday 30
Sunday 31
Month to Date Actuals

% Variance

A
du
lt

dm
i ss

io
n

Bi
r

A
ug

us
t

th
s*

s+
SC
N

(S
i

ns

ck

ba
b

io
ns

ie
s)

Daily Operating Summary

43
44
1
15
55
44
44
36
45
21
13
52
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
412

31

163
149
134
168
175
161
154
156
124
122
157

104
80
74
4
105
89
114
81
112
95
106
102

199
40
24
229
188
184
203
176
51
18
201

24
6
5
20
16
13
8
19
5
4
16

18
1
0
28
15
17
35
18
1
0
21

1,663

3.79
3.59
43
4.37
3.91
3.93
3.88
3.93
3.87
3.99
4.18
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04
4.04

1,062

1,513

136

154

42
7
5
48
31
30
43
37
6
4
37
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
290

1
0
0
3
2
1
3
4
0
0
1

20
1
0
14
7
12
8
14
0
0
7

1,172,443
602,849
43 16
435,716
1,109,287
1,116,312
828,066
817,852
1,130,889
451,820
413,090
1,073,455

506,876
129,647
139 2 2
139,252
657,494
433,525
440,992
488,775
514,028
104,396
205,454
389,687

15

83

9,151,778

4,010,125

430

1,893

4.40

1,222

2,045

164

186

351

10,111,295

4,117,665

-10

-18

-230

0.37

-160

-532

-28

-32

-61

-959,517

-107,539

-31.2%

-4.2%

-12.2%

8.3%

-13.1%

-26.0%

-17.2%

-17.3%

-17.3%

-9.5%

-2.6%

86

1,212

5,335

4.4018152

3,444

5,762

463

525

28,495,468

11,604,328

16

Reprinted with Permission

Daily KPI (Most Practical)

DailyKPI(MostPractical)
HoursPerUnitsofService(Productivity)
y Puttingdailyhoursofservicetogetherwithdailyunitsof

servicecanproduceoneofthemostmeaningfulkey
(
p
g)
financial(andoperating)indicator
y Hours(workedorpaid)perunitofservice
y ThisisotherwiseknownasProductivity

y Aswewillseelater
Aswewillseelater,productivitycanalsobedeveloped
productivitycanalsobedeveloped
y Weekly(notcommon)
y Biweekly
y Monthly
y Quarterly
y Annually
17

Baldrige and Top 100 Winner Case Study

SSM Health Care

DailyLaborProductivitybyDepartment

Reprinted with Permission

18

WeeklyKPIs
y AnyKPIthatisproducedonadailybasiscanbe

aggregatedonaweeklybasis
y Wewillseeanexcellentrepresentationofthislaterin
W ill
ll
i f hi l
i
theclass

19

BiweeklyKPIs
y Whenreportingbiweeklyresults,themostcommonKPIsarelaborrelated:
y Payroll
y
y

Hourspaid
Hoursworked

y Nonpayroll
y
Simpleunitsofservice(Tests,Procedures)
y
Complexunitsofservice(RelativeValueUnits)
y ProductivityBased
y
Hourworkedperunitsofservice
y
H
Hourspaidperunitsofservice
id it f
i
y
Averagedollarsperunitsofservice,and
y
Thevariances
y EfficiencyVariance(thisisalsoavailableonadailybasis,ifdesired
y Differencebetweenbudgetedandactualhours
y RateVariance
R V i
y Differencebetweenbudgetedandactualaveragehourlyrates

y AlloftheotherKPIsdevelopedfordailyreportingareapplicableonabiweeklybasis,

includingChargeBased(chargeableservicesrendered)
y Inpatientgrossrevenues
p
g
y Outpatientgrossrevenues

20

MonthlyKPIConcepts
y Monthlyisthetimeperiodmostoftenassociatedwith

financialreporting
y KPIsareoftentheresultofmonthlybalancesheetand

incomestatementreporting
y ThemostimportantKPIstoreportonamonthlybasis
arethosethataredeemedtoberelevanttobondratings
th th t d
dt b l
tt b d ti
(eveniftherearenobondsoutstandingmaybe
somedaysoon,theorganizationwillwanttogooutto
th d bt
thedebtmarket)
k t)

y ItisimportanttosetuptheKPIreportingtomaximize

theunderstandingofthereader
g
21

Monthly KPIs
MonthlyKPIs
Volumes
y Inpatient
y
y
y
y
y
y

Admissions
Adjustedadmissions
ObservationDays

y
y
y

Averagelengthofstay
Patientdays
Averagedailycensus

Discharges
Adjusteddischarge

y PayerMix
y
y
y
y

Medicare
d
Medicaid
ManagedCare
Other

y Outpatient

Emergencydepartment(ED)admissions
EDadmissionsasapercentageoftotal
admissions
EDadmissionsasapercentageEDvisits

y
y
y

SurgicalProceduresandCSections
SameDaySurgeryProcedures
OpenHeartSurgeryProcedures

y
y
y
y
y
y
y
y

Deliveries
LaboratoryProcedures
RadiologyProcedures
MRIProcedures
Ultrasounds
CTScans
HomeHealthVisits
FamilyCareCenterVisits

y
y

22

Monthly KPIs
MonthlyKPIs
Financial
y
y
y
y
y
y
y
y
y
y

Dayscashonhand
Operatingmarginpercentage
Net(excess)marginpercentage
(
)
g p
g
Debtservicecoverage
Debttocapitalizationpercentage
Cushionratio
Capitalexpensepercentage
Averageageofplant
Daysofrevenueinaccountsreceivable
Baddebt&charityexpenseasapercentageofnet
patientrevenue
y Currentratio
23

Monthly KPIs
MonthlyKPIs
Operational
y Salaries,fringebenefitsandcontractlaborasa
y
y
y
y
y
y
y
y
y

percentageoftotalrevenue
Salaryexpenseperadjustedadmission
Supplyexpenseperadjustedadmission
Totalexpenseperadjustedadmission
Supplyexpenseasapercentageofnetpatientrevenue
Outpatientrevenueasapercentageoftotalrevenue
Casemixindex(CMI)
N t
Netrevenueperadjustedadmission(casemix
dj t d d i i (
i
adjusted)
Costperadjustedadmission(casemixadjusted)
T l idh
Totalpaidhoursperadjustedpatientday
dj
d i d
24

QuarterlyKPIs
y QuarterlyKPIsaremostoftenassociatedwithbonddebt

reporting
y Bondshavecovenantsthatmustbemetinordertoensure
thattheborrower(thehospital)isnotdefaulting
y Thecovenantsareoftenintheformofratios,suchas
,
y Currentratio
y Cushionratio
y Debttocapitalization
b
l
y Debtservicecoverage
y Dayscashonhand
25

AnnualKPIs
y ForannualKPIs,bestpracticehospitalsareutilizinga

varietyofbenchmarkedmetricsthataretotheindustry
y ThereareseveraldifferentsetsofBestPracticeKey
FinancialIndicatorstochoosefrom.Hereisasampling:
y Solucients100TopHospitalsFinancialKPIs
y CleverleyandAssociatesFinancialStrengthMeasures
y HMFAsKeyHospitalFinancialStatisticsandRatios
y StandardandPoors
y FitchRatings
Fi hR i
y Ingenix
y Premier
y Solucient
S l i t
26

Thomson 100 Top HospitalsFinancial

Financial
Thomson100TopHospitals
KPIsCalculationsandBenchmarks
100 Top Hospital
Winners

Peer Group of
U.S. Hospitals

3.52

3.94

1) Severity-adjusted average length of stay

Totall Patient
i Days (adjusted
( dj
d for
f severity
i (RDRG))
(
G))
Total Discharges

2) Expense per adjusted discharge, case mix- and wage adjusted

4,147

4,950

Total Operating Expenses

Number of Adjusted Discharges (case mix and wage adjusted)

3) Profitability (operating profit margin) %

8.95

2.46

0.35

0.16

Total Operating Revenue Total Expenses

Total Operating Revenue

4) Cash flow to total debt ratio

Net Income + Depreciation Expense + Interest Expense
Total Liabilities

5) Tangible assets (net PPE) per adjusted discharge

3,026

2,727

Total Property, Plant and Equipment Accumulated Depreciation

Total Number of Acute Care Discharges
Reprinted with Permission Solucient, Courtesy of Jean Chenowith, Executive Director,
Published in 2007 www.solucient.com

27

Cleverley&AssociatesFinancialStrength
MeasuresandBenchmarks
MEASURE

CALCULATION
Total Margin - 4.0
4.0
+
Days Cash on Hand - 50 50
Debt Financing % - 50
50
Accumulated Depreciation Expense % - 50
50

LOW QUARTILE

HIGH QUARTILE

-2.0

3.5

-2.4

10.8

29

78

1)

Financial Strength Index

2)

Total Margin

Excess of Revenues Over Expenses

Total Revenue

3)

Days Cash on Hand

Cash and Cash Equivalents + Long Term Investments

Total Expenses / 365

4)

Debt Financing Percentage

Total Assets - Net Assets

Total Assets

x 100

53.8

26.1

5)

Accumulated Depreciation Percentage

Accumulated Depreciation
Gross Property Plant and Equipment

x 100

56.2

49.4

100.4

113.1

17.3

22.8

6)

Overall Charge Index

7)

Surgical Cases Percentage

x 100

Average Charge per Medicare Discharge (CMI adjusted)

US Median
x Inpatient Revenue Percentage
+
Average Charge per APC (RW adjusted)
x Outpatient Revenue Percentage
US Median
Total Medicare Inpatient Surgical Cases
Total Medicare Inpatient Cases

x 100

Reprinted with permission:

William O. Cleverley, Ph.D. President
Cleverley & Associates
1-888-779-5663 ( Ext. 222)
wcleverley@cleverleyassociates.com

28

Cleverley & Associates Financial Strength

Cleverley&AssociatesFinancialStrength
MeasuresandBenchmarks
8)

Market Share Percentage

Net Patient Revenue

Sum of Net Patient Revenues in County

x 100

32

43

9)

Change in Medicare CMI Percentage

Percentage Change in Medicare Case Mix Index (two years)

0.1

1.0

10)

Non Government Payers Percentage

Percent of Revenue from Sources Other Than Medicare and Medicaid

31.8

36.1

11)

Overall Cost Index

Average Cost per Medicare Discharge (CMI adjusted)

US Median
x Inpatient Revenue Percentage
+
x Outpatient Revenue Percentage
Average Cost per APC (RW adjusted)
US Median

103.3

101.7

12)

Net Patient Revenue per Full Time Equivalents Net Patient Revenues
Full Time Equivalents

99.0

126.8

13)

Medicare Length of Stay (CMI = 1.00)

Medicare Inpatient Days

Medicare Discharges x CMI

4.3

3.9

14)

Overhead Cost Percentage

Overhead Expenses
Total Expenses

33.6

32.3

15)

Times Interest Earned

Excess of Revenues Over Expenses + Interest Expense

Interest

-0.5

10.3

x 100

Reprinted with permission:

William
illi
O.
O Cleverley,
Cl
l Ph.D.
h
President
Cleverley & Associates
1-888-779-5663 ( Ext. 222)
wcleverley@cleverleyassociates.com

29

HFMA Knowledge Network

HFMAKnowledgeNetwork
KeyHospitalFinancialStatisticsandRatioMedians
December2007
S & P (1)
Fitch (2)
Thomson (3) Ingenix /
Premier, Inc Data Advantage
Measure
All Ratings All Ratings Solucient
(4)
(5)
Corp (6)
Sample size (n)
556
218
644
1,548
699
4,363
Average length of stay (%)
N/A
4.50
4.19
4.42
4.34
4.70
Maintained bed occupancy (%)
N/A
N/A
63.07
53.50
58.61
64.84
Operating margin (%)
2.90
2.80
2.98
2.82
2.61
(0.59)
Excess margin (5)
5.30
5.00
4.82
N/A
4.61
6.39
Debt service coverage (x)
3.90
3.80
3.42
3.74
N/A
N/A
Current ratio (x)
N/A
N/A
2.13
2.02
3.17
1.92
Cash on hand (days)
162 20
162.20
168.50
168
50
124 71
124.71
99 10
99.10
N/A
37 44
37.44
Cushion ratio (%)
13.20
12.70
N/A
7.76
N/A
N/A
Accounts receivable (days)
49.90
49.70
53.88
53.70
51.91
52.55
Average payment period (days)
58.10
62.30
50.83
51.40
N/A
67.28
Average age of plant (years)
9.60
9.80
9.68
9.73
N/A
14.33
Debt to capitalization (%)
Debt-to-capitalization
37 40
37.40
40 80
40.80
37 19
37.19
28 00
28.00
35 89
35.89
30 84
30.84
Capital expense (%)
N/A
N/A
7.32
5.53
6.72
4.05
1.
2.
3.
4
4.
5.
6.

Standard & Poors US Not For Profit Healthcare 2007 Stand-Alone Hospital Medians
FITCH Ratings. 2007Median Ratios for Nonprofit Hospitals and Health Care Systems
2007 Thomson Healthcare Action O-I Data
2007 Ingenix,,
Ingenix Inc.
Inc Financial Analysis and Str.
Str Op.
Op Indicators Services and Medicare Cost Reports (2007 Almanac Version)
Premier, Inc. Operations Advisor for the Year Ended June 30, 2007 (Median Data)
Copyright 2007 by Data Advantage Corporation
Reprinted with Permission
All Rights Reserved. Healthcare Financial Management Association (HFMA), 2007

30

KeyHospitalFinancialRatioCalculations
Operating margin (%)
Excess margin (%)
Debt service coverage (x)
Current ratio (x)
Cash on hand (days)
Cushion ratio ((%))
Accounts receivable (days)
Average payment period (days)
Average age of plant (years)
Debt-to-capitalization
p
((%))
Capital expense (%)

(Total operating revenues Total operating expenses) / (Total operating revenues) x 100
(Total operating revenues + Non-operating revenues Total operating expenses) / (Total operating
revenues + Non operating revenues) x 100
(Excess of Revenues ove Expenses + Deprec + Interest Exp) / (Principal + interest payments)
(Current Assets / Current Liabilities)
((Cash and Cash Equivalents + Board Designated Funds for Capital) * 365) / (Total operating
expenses depreciation and amortization expenses)
(Cash + Short Term Investments + Unrestricted Long Term Inv ) / (Principal + interest payments)
(Net patient accounts receivable x 365) / net patient revenues
(Current Liabilities) / ((Total Expenses - Depreciation) / 365))
(Accumulated Depreciation) / (Depreciation Expense)
((Longg term debt)) / ((Longg term debt + Net Assets)) x 100
(Interest Expense + Depreciation Expense) / (Total Expenses) x 100

31

PollQuestions
y 1.Areyoucapturingandreportingthebudgetedand

actualresultsofthe11financialmetricsonamonthly
basis?
y Yes
Y
y No

y 2.Haveyoudevelopedlaborproductivitystandardsatyour

h
hospital?
i l?
y Yes
y No

y 3.Ifyes,areyouroutinely(biweekly)reportingthe

budgetedandactuallaborproductivityresults?
y Yes
y No

32

Objective #3
Learning
L
i the
th Best
B t Ways
W to
t Present
P
t
the Keyy Performance
f
Indicators for
f
Effective Management Outcomes
33

Understanding the Need to Utilize Key

UnderstandingtheNeedtoUtilizeKey
PerformanceIndicatorsinReporting
Therearesomanydifferentwaystopresentfinancialinformation
y Reportdesignsshouldincludeavarietyofoptions
y
y
y
y
y

Whoistherecipient(i.e.whoisthereportbeingdesignedfor?)
Whoelsewillbereceivingthereport?
Whatisthepurposeofthereport(whatistryingtobeachieved?)
Whatisthescopeofthereport?
Wh tti i d
Whattimeperiodsareneededinthereport?
d di th
t?

y Reportdesignsshouldincludeavarietyoflooks
y Trends
y Colorcoding
y Graphsandchartsratherthantablesandnarratives,ifappropriate
y Mostimportantly,allreportsshouldbeACTIONABLE!!!
y Buildingreportsaroundkeyfinancialindicatorshelpstoachieve
thesegoals
34

EXAMPLE HOSPITAL AND HEALTH CENTERS

THE IMPORTANT NUMBERS REPORT 2003
MAY, 2003 ACTUAL VS. PRIOR YEAR

ACTIVITY

The Important Numbers Report

Current
Month

Budget
Month

Prior
Year

Variance To
Budget

Variance To
Prior Year

(77.00)
(8.00)
(116.00)
6 00
6.00
18.00
(228.06)
(641.30)
(238.59)
(647.94)
0.11
0.17
(3.74)
(0.01)
468.00
(107.00)
4.00
(162.00)
6.00
35.00
3.00
1.51
327.00
(48.00)
(13.00)
(4,974.00)
(1,457.00)
0.07
0.09
(10 00)
(10.00)

(10.00)
4.00
371.00
27 00
27.00
27.00
(232.86)
(322.18)
(237.83)
(322.55)
0.23
0.33
11.97
0.04
(1,804.00)
43.00
11.00
(143.00)
3.00
(579.00)
(17.00)
(5.00)
122.00
(52.00)
(17.00)
3,298.00
(2,142.00)
0.22
0.05
2 00
2.00

Current
YTD

Budget
YTD

ImportantNumbersReport

Admissions (Excludes Nursery)

Admissions (Nursery)
Patient Days (Excludes Nursery)
Patient Days (Nursery)
Observation Days
Equivalent Discharge
Equivalent Patient Days
Equivalent Discharge (Includes Nursery)
Equivalent Patient Days (Includes Nursery)
ALOS (ALL)
ACUTE ALOS (Excludes Hospice, Rehab & Psyc
Average Daily Census
%Occupancy
OP Registrations(Including ER)
ER Visits Including IP Admits
ER IP Admits
Surgeries
Open Heart Surgeries (OF ONLY)
Home Health Visits
Home Health Census
Home Health Admissions
Physician Visits
Psych Admissions
Rehab Admissions
OP Procedures
OP Visits
Average Acuity -Total
Average Acuity - Medicare
Deliveries

1,808.00
145.00
7,585.00
366 00
366.00
205.00
2,644.14
11,092.82
2,750.17
11,360.45
4.20
4.11
244.68
0.70
12,231.00
5,060.00
1,074.00
1,096.00
26.00
4,085.00
322.00
176.00
2,145.00
40.00
63,181.00
17,291.00
1.19
1.43
143 00
143.00

1,885.00
153.00
7,701.00
360 00
360.00
187.00
2,872.20
11,734.12
2,988.76
12,008.39
4.09
3.94
248.42
0.71
11,763.00
5,167.00
1,070.00
1,258.00
20.00
4,050.00
319.00
174.49
1,818.00
48.00
53.00
68,155.00
18,748.00
1.12
1.34
153 00
153.00

1,818.00
141.00
7,214.00
339 00
339.00
178.00
2,877.00
11,415.00
2,988.00
11,683.00
3.97
3.78
232.71
0.66
14,035.00
5,017.00
1,063.00
1,239.00
23.00
4,664.00
339.00
181.00
2,023.00
52.00
57.00
59,883.00
19,433.00
0.97
1.38
141 00
141.00

9,107.00
746.00
38,274.00
1 763 00
1,763.00
1,212.00
13,476.87
56,801.44
14,069.02
58,109.65
4.20
4.09
253.47
0.72
59,859.00
24,907.00
5,382.00
5,547.00
121.00
19,501.00
324.00
829.00
10,717.00
4.00
246.00
321,351.00
93,876.00
1.16
1.35
730 00
730.00

9,679.00
770.00
39,559.00
1 826 00
1,826.00
1,047.00
14,726.10
60,186.96
15,311.85
61,576.04
4.09
3.95
261.98
0.75
60,410.00
25,565.00
5,297.00
6,465.00
99.00
20,250.00
319.00
860.84
9,090.00
233.00
259.00
325,418.00
95,064.00
1.12
1.34
770 00
770.00

Prior Year Variance To

YTD
Budget
9,268.00
714.00
37,948.00
1 661 00
1,661.00
1,199.00
14,156.00
58,296.00
14,867.00
59,572.00
4.09
3.92
251.31
0.72
73,121.00
24,820.00
5,200.00
6,379.00
96.00
20,762.00
323.00
902.00
9,922.00
210.00
281.00
297,720.00
97,256.00
1.13
1.37
704 00
704.00

(572.00)
(24.00)
(1,285.00)
(63 00)
(63.00)
165.00
(1,249.22)
(3,385.52)
(1,242.83)
(3,466.39)
0.12
0.15
(8.51)
(0.02)
(551.00)
(658.00)
85.00
(918.00)
22.00
(749.00)
5.00
(31.84)
1,627.00
(229.00)
(13.00)
(4,067.00)
(1,188.00)
(0.04)
(0.01)
(40 00)
(40.00)

35

EXAMPLE HOSPITAL AND HEALTH CENTERS

THE IMPORTANT NUMBERS REPORT 2003
MAY, 2003 ACTUAL VS. PRIOR YEAR

ACTIVITY

Current
Month

The Important Numbers Report

Budget
Month

PriorVariance To Variance To
Year
Budget Prior Year

BALANCE SHEET
Net Days in Receivables
Net Days in Receivables (Regional Summary)*
Capital Expenditures and Equity Transfers
Equity Growth
Total Contributions - Restricted/Unrestricted
*Includes Current YTD Net Patient Serv. Revenue (excludes Premium Revenue)
OPERATIONS ALL
Gross Revenues
Contractual Allowances+CGS
Net Patient Revenue
Other Revenue
Salary, Benefits and Contract L
Interest, Depreciation and Amo
Total Expenses
T t l Operating
Total
O
ti
Income
I
Investment Income
Contributions
Other Non Operating Income
Net Income
EBIDTA
EBIDTA Margin
NET INCOME BY ENTITY
Hospital and Other
Home Health
Outpatient Pharmacy
Buildings
Professional Practice
Operating Income/(Loss)
Operating Margin
Non Operating Hospital
Non-Operating
Total
Total Margin Pct.
Return on Investment

REVENUE
% Inpatient
%Outpatient

49,757,630
30,040,511
19,717,119
1,052,379
10,585,072
1,391,636
20,914,879
(145 381)
(145,381)
26,688
5,015
19,248
(94,430)
1,246,255
6.00%

46,366,746
26,966,161
19,400,585
796,248
10,086,119
1,392,883
20,356,576
(159 743)
(159,743)
50,077
85,243
(24,423)
1,233,140
6.11%

(170,897)
90,518
42,208
(46,042)
(61,168)
(145,381)
-0.70%
50 951
50,951
(94,430)
-0.45%

(234,050)
138,058
2,328
(9,118)
(56,961)
(159,743)
-0.79%
135 320
135,320
(24,423)
-0.12%

(350,663)
185,238
(5,067)
(52,593)
(95,546)
(318,631)
-1.64%
10 209
10,209
(308,422)
-1.58%

68.38%
31 62%
31.62%

65.63%
34 37%
34.37%

63.41%
36 59%
36.59%

Current
YTD
70
70
30,513,618
-4.09%
382,219

44,239,820 3,390,884
25,222,690 3,074,350
19,017,130
316,534
461,124
256,131
9,583,229
498,953
1,353,030
(1,247)
19,796,885
558,303
(318 631)
(318,631)
14 362
14,362
2,672
(23,389)
3,867
(80,228)
3,670
19,248
(308,422)
(70,007)
1,034,399
13,115
5.31%
-0.11%

Budget
YTD
62
62
3.01%

Prior Year
YTD
60
58
6,307,832
-1.23%
134,406

Variance To
Budget
7

5,517,810
4,817,821
699,989
591,255
1,001,843
38,606
1,117,994
173 250
173,250
24,016
1,148
15,578
213,992
211,856
0.69%

244,634,967
147,991,222
96,643,745
4,149,651
49,934,732
6,959,504
102,991,121
(2 197 725)
(2,197,725)
86,625
28,098
18,808
(2,064,194)
4,761,779
4.72%

234,559,312
136,414,939
98,144,373
3,992,939
49,795,099
6,964,415
101,294,472
842 840
842,840
250,385
426,215
1,519,440
7,807,255
7.64%

215,098,122
123,938,114
91,160,008
2,261,950
44,870,888
6,765,332
94,474,069
(1 052 111)
(1,052,111)
476,313
3,633
8,308
(563,857)
5,713,221
6.12%

10,075,655
11,576,283
(1,500,628)
156,712
139,633
(4,911)
1,696,649
(3 040 565)
(3,040,565)
(163,760)
(398,117)
18,808
(3,583,634)
(3,045,476)
-2.92%

63,153
(47,540)
39,880
(36,924)
(4,207)
14,362
0.09%
(84 369)
(84,369)
(70,007)
-0.33%

179,766
(94,720)
47,275
6,551
34,378
173,250
0.94%
40 742
40,742
213,992
1.13%

(2,509,343)
616,696
28,881
(45,201)
(288,758)
(2,197,725)
-2.18%
133 531
133,531
(2,064,194)
-2.05%
-2.92%

382,926
749,465
13,443
(45,599)
(257,395)
842,840
0.83%
676 600
676,600
1,519,440
1.49%
2.15%

(1,523,150)
1,078,048
78,264
(282,989)
(402,284)
(1,052,111)
-1.13%
488 254
488,254
(563,857)
-0.60%
-0.52%

(2,892,269)
(132,769)
15,438
398
(31,363)
(3,040,565)
-3.01%
(543 069)
(543,069)
(3,583,634)
-3.54%
-5.08%

2.75%
-2.75%
2 75%

4.97%
-4.97%
4 97%

67.38%
32 62%
32.62%

65.73%
34 27%
34.27%

65.31%
34 69%
34.69%

1.66%
-1.66%
1 66%

36

The Important Numbers Report

TheImportantNumbersReport
EXAMPLE HOSPITAL AND HEALTH CENTERS
THE IMPORTANT NUMBERS REPORT 2003
MAY, 2003 ACTUAL VS. PRIOR YEAR

ACTIVITY

Current
Month

Budget
Month

SALARY INFO
FTE per Adjusted Occupied Bed
Employees Paid (Last Payroll)
Paid FTE's
Worked FTE's
Compensation Ratio
Salary/Benefit/Contract Labor per Operating Rev.
Benefit Percentage of Salaries
Salary/Benefit
y
per
p FTE
%OT
%Non Productive
Manhours Per Adjusted Admission *
Manhours Per Adjusted Patient Day *
* Includes contracted labor hours

5.55
2,256.00
2
256 00
1,985.62
1,824.00
54.97%
50.96%
29.21%
5,330.88
,
2.74%
8.67%
132.66
31.62

1,902.66
1,705.00
53.98%
49.94%
25.56%
5,301.05
,
2.41%
10.17%
117.03
28.64

FTE's BY ENTITY (Paid) *

Hospital and Other CH*
Hospital and Other OF*
Home Health
Professional Practice*
Total*
* Includes contracted labor hours

1,412.37
502.63
57.88
12.74
1,985.62

1,318.84
517.45
55.53
10.84
1,902.66

5.03

Prior ariance To Variance To

Year
Budget Prior Year
5.10
2,188.00
2
188 00
1,871.46
53.79%

0.52
82.95
119.00
0.99%
1.03%
29.83
0.33%
-1.50%
15.64
2.98

1,295.87
506.05
56.67
12.87
1,871.46

93.53
(14.82)
2.35
1.90
82.95

0.45
68.00
68
00
114.16

Current
YTD
5.30

Budget
YTD
4.89

Prior YearVariance To
YTD
Budget
4.83

1,989.13
1,947.74
1,865.62
1,807.00
1,763.00
1,691.99
1.18%
53.70%
52.70%
52.60%
49.54%
48.75%
48.03%
26.29%
26.00%
24.93%
25,103.82
,
25,565.59
,
24,052.00
,
2.74%
2.35%
5.35%
9.23%
9.94%
9.10%
126.64
113.81
112.77
30.13
27.85
27.54

116.50
(3.42)
1.21
(0.13)
114.16

1,422.19
495.99
57.98
12.97
1,989.13

1,363.11
517.19
56.59
10.84
1,947.74

1,277.17
519.06
56.08
13.31
1,865.62

0.41
41.39
44.00
1.00%
0.79%
0.29%
((461.78))
0.38%
-0.72%
12.83
2.29

59.07
(21.20)
1.39
2.13
41.39

37

The Important Numbers Report

TheImportantNumbersReport
EXAMPLE HOSPITAL AND HEALTH CENTERS
THE IMPORTANT NUMBERS REPORT 2003
MAY, 2003 ACTUAL VS. PRIOR YEAR

ACTIVITY
OTHER INFO
% Bad Debt
% Charity
Deductability Ratio W/Bad Debt
Volunteer Hours
Capitated Lives/Member Months PHO
Net Revenue per Employee
Inpatient Nursing Unit Costs

Current
Month

Budget
Month

Prior ariance To ariance To

Year
Budget Prior Year

1.48%
1.49%
1.52%
2 75%
2.75%
2 77%
2.77%
2 82%
2.82%
61.85%
59.65%
58.53%
4,704.00
4,240.00
5,250.00
14,000.00 14,000.00 13,500.00
10,459.98 10,615.03 10,408.05

-0.02%
-0.03%
0 03%
2.20%
464.00
(155.05)

75.18
172.69
18,818.06
4,485.57
7,854.91
1,872.34
7,909.89
1,885.44

71.60
156.26
16,143.28
3,951.45
7,031.83
1,721.21
7,087.45
1,734.82

70.50
161.44
15,379.00
3,876.00
6,771.00
1,706.00
6,882.00
1,734.00

3.58
16.43
2,674.78
534.12
823.08
151.13
822.44
150.62

Budget
YTD

Prior YearVariance To
YTD
Budget

-0.04%
1.83%
1.49%
1.62%
0.34%
-0.07%
0 07%
3 40%
3.40%
2 77%
2.77%
3 01%
3.01%
0 62%
0.62%
3.32%
62.32%
59.65%
59.23%
2.67%
(546.00) 23,519.00 21,777.00 25,424.00
1,742.00
500.00 70,000.00 70,000.00 66,000.00
51.93 50,672.12 52,438.91 50,076.00 (1,766.79)
420.64
414.20
374.01
6.44

Days In Accounts Receivable by Entity

Hospital and Other
Home Health
MD
Total
OTHER INFO
Drug Expense Per Adjusted Patient Day
Other Medical Expense Per Adjusted Patient Day
Gross Patient Revenue Per Adjusted Admission
Gross Revenue Per Adjusted Patient Day
Net Revenue Per Adjusted Admission
Net Revenue Per Adjusted Patient Day
Expense Per Adjusted Admission
Expense Per Adjusted Patient Day

Current
YTD

4.68
11.25
3,439.06
609.57
1,083.91
166.34
1,027.89
151.44

69.95
57.36
55.58
69.57

60.00
48.83
80.00
62.21

60.94
48.36
57.57
59.71

9.95
8.53
(24.42)
7.36

65.49
183.26
18,152.20
4,306.84
7,478.99
1,774.49
7,642.06
1,813.18

71.02
152.69
15,928.14
3,897.18
6,935.80
1,697.00
6,878.57
1,683.00

66.32
148.11
15,108.00
3,690.00
6,562.00
1,603.00
6,636.00
1,621.00

(5.54)
30.57
2,224.06
409.67
543.19
77.49
763.49
130.18

38

Instead,let
slookatreportsthatuse
Instead,letslookatreportsthatuse
keyperformanceindicators
astheirbasisand
expectactionstoresult
i

l
fromeveryreportoutcome!
y KingsDaughtersMedicalCenter
y JPSHealthNetwork
y IngallsHealthSystem
ll
lh

39

KingssDaughtersMedicalCenter(AshlandKY)
Daughters Medical Center (Ashland KY)
King
VitalStatistics
FACILITIES:
Number of Hospitals in the Health System
Number of Total Entities in Health System
Total number of licensed beds (hospital only)
Annual Admissions
Annual Outpatient Visits
Annual Emergency Department Visits

1
6
385
23,000
253,000
69,000

FINANCIAL RESULTS:
Net Revenues
Operating Margin Percentage
Days Cash on Hand

$ 312
312,000,000
000 000
7.5%
188.5

PAYER MIX PERCENTAGE:

M di
Medicare
Medicaid
Managed Care
Other
Total

48.0%
48
0%
15.3%
22.5%
14.2%
100.0%

40

Kings Daughters Medical Center (KDMC)

KingsDaughtersMedicalCenter(KDMC)
Background
y PaulMcDowell,CFO
y Icannotthinkofamoreimportantthingthatwedoin

Financethanhelpmanagersdeterminetheirfinancial
outcomes

y Background
y 5yearsatKingsDaughters
5y
g
g
y PreviousemploymentatHMA,aforprofithealthsystemforfive

years.AlsoatProminaHealthSystem,anotfor profitsystemin
Atlantaforsixyears

y IfthehostITsystemwillcreatethereportgreat.Ifthey

donot,thentheFinancestaffwillcreatethereporttoget
actionablepointsacrosstothemanagers
41

KDMCReportingPhilosophy
sDaughtersMedicalCenterhashadverygood
y King
KingsDaughtersMedicalCenterhashadverygood
financialsuccess
y Inthepast,thefinancialreportingwaseither
y Toolittleor
y Toomuch

y PaulMcDowell,theCFO,believesthatthereportingof

fi
financialinformationmustbe:
i li f
i
b
y Consistent
y Concise,and
y Meaningful

y AccordingtoMcDowell
y ReportinghashelpedKingsDaughterstostayfocusedon
p
g
p
g
g
yf

financialperformanceinthemidstofsignificantgrowth
42

KDMC DailyMonitor
Gauging
the Pulse
GaugingthePulse
Census
Day
FRI
SAT
SUN
MON
TUE
WED
THU
FRI
SAT
SUN
MON
TUE
WED
THU
FRI
SAT
SUN

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

Admits
78
36
29
93
82
96
91
74
26
33
79
104
96
80
69
28
17

ER

IP Days OBS Days Total

Occ% Births Admits
343
10
353 90.98%
90 98%
4
27
278
5
283 72.94%
0
39
269
269 69.33%
3
36
327
11
338 87.11%
4
56
323
15
338 87.11%
3
38
335
18
353 90.98%
2
40
375
13
388 100.00%
8
45
339
18
357 92.01%
4
51
282
8
290 74.74%
2
38
286
286 73.71%
0
50
332
13
345 88.92%
6
42
408
12
420 108.25%
6
44
371
15
386 99.48%
4
44
339
12
351 90.46%
2
47
315
11
326 84.02%
2
39
250
4
254 65.46%
65 46%
4
30
239
239 61.60%
1
31

Surgeries

Visits Daily Adm % I/P

149
18 12%
18.12%
48
164
23.78%
9
172
20.93%
13
234
23.93%
20
196
19.39%
44
210
19.05%
50
202
22.28%
42
231
22.08%
39
141
26.95%
17
204
24.51%
2
280
15.00%
46
197
22.34%
61
226
19.47%
71
191
24.61%
44
200
19.50%
49
129
23 26%
23.26%
9
200
15.50%
10

O/P
79
4
4
62
81
24
48
25
2
92
64
91
114
69
6
5

Total
127
13
17
82
125
74
90
64
19
2
138
125
162
158
118
15
15

Cath
Lab MRI
45
40
2
21
0
8
48
32
53
42
33
29
44
34
44
41
6
14
3
3
57
31
57
38
50
30
32
38
46
41
4
13
2
11

MTD

1,111

5,411

165

5,576

84.54%

55

697

3,326

20.96%

574

770

1,344

526

466

EOM Proj

2,066

9,690

311

10,002

85.92%

102

1,241

5,930

20.93% 1,074

1,472

2,547

1,000

861

g
Budget
vs. EOM

1,963
103

8,920
770

415
(104)

9,335
667

80.20%

122
(20)

958
283

5,809
121

16.50% 1,196
(122)

1,705
(233)

2,901
(354)

864
136

845
16

Last Month
vs. EOM

2,378
(312)

10,963
(1,273)

366
(55)

11,329 97.33%
(1,327)

132
(30)

1,313
(72)

5,946
(16)

22.08% 1,388
(314)

1,975
(503)

3,363 1,006 1,045

(816)
(6) (184)

56,606
54,989
1 617
1,617

768
738
30

7,188
5,776
1 412
1,412

34,739
35,007
(268)

20.69% 6,856
16.50% 6,567
4 19%
4.19%
289

YTD Actual
YTD Budget
YTD Var
Var.

12,064
11,430
634

54,156
52,465
1 691
1,691

2,450
2,524
(74)

53.05%
51.54%
1 52%
1.52%

10,457
9,863
594

17,313
16,430
883

5,401
4,968
433

4,894
4,950
(56)

EOM projections are based on a sophisticated model using prior14 day periods and factoring in weekends
Sent to CEO and all VPs and Business Office.
If the numbers start to fall out of goal range, action can immediately be initiated.
Many conservations start with the Hey, I was looking at the Daily Monitor Report this morning, and

43

KDMC DailyTeamHuddle
Fi
i lI
FinancialIssues
y

MarchwasaTREMENDOUSrecordbreakingmonth!Wayto
goTeamKDMCHereswhatyoudidduringthemonthof
March:
y
y

y
y
y
y
y
y
y

y
y

80,765Laboratorytestsperformed an8%increaseoverlast
Marchstestsof74,826.Themosttestseverperformedinthehistory
ofthehospital.
1,388SurgicalProceduresandCSections analmost13%
increaseoftherecordsetinOctoberthisyearwith1,230procedures.
Thisisarecord numberofinpatientsurgeryproceduresfora
month
month.
1,975SameDaySurgeryProcedures over6%increaseoflast
Marchsproceduresof1,852.Thisisarecord numberofoutpatient
surgeryproceduresforamonth.
10,495RadiologyProcedures over11%increasemorethan
December2003recordproceduresof9,428.Thisisanotherrecord
numberofproceduresforamonth.
3 078CTScans over10%increasemorethanlastApril
3,078CTScans
over10%increasemorethanlastAprilsrecord
srecord
settingCTscansof2,780.Yetanotherrecord setintheimaging
servicesdepartment.
1,045MRIprocedures morethana15%increaseoverlastMarchs
recordbreakingproceduresof907settinganewrecord inthe
historyofthediagnosticcenter.
80OpenHeartSurgeries anover8%increasemorethanthe
record setinOctober2004of74.
setinOctober2004of74
1,006Cath LabProcedures anover4%increasemorethanthe
record setinSeptember2004with960procedures.Thisisarecord
inthehistoryoftheheartprogramatKDMC.
182AngioplastyProcedures a5%increaseoverlastMarchs
recordnumberof173procedures.Thisisyetanotherrecord inthe
historyoftheheartprogramatKDMC.

The Daily Team Huddle is

prepared each day for each
of the different
organizational priorities
(Customer, Quality,
Community, Finance,
Culture)
- The Financial Issues page
is prepared by the Finance
Division
- Delivered to the staff
through department
management every
Thursday
ff
ffinancial issues
- Different
are highlighted each week.
It may not just be statistical.
(ie. Supply utilization,
Overtime monitoring, etx)

Manythankstoallofyouwhoworkedsoveryhardduringthis
M
th k t ll f
h
k d
h dd i thi
month.
KEEPUPTHEGREATWORK!!!

44

KDMC Biweekly
KDMC
ActivityReport
Patient
Days
Budget

4,231

Gross
Revenue

Rev/APD

M/C
CMI

M/C Total YTD

ALOS ALOS ALOS

ADC

DSCH

Adj Dsch

302

930

1,496

23,817,445

3,499

1.62

5.01

4.22

4.22

Salaries
4,112,951

Sal/APD Sal % Rev

604

18.1%

197,246

Hours

9-Apr

4,740

339

1029

1,583

23,642,413

3,240

1.65

5.12

4.26

4.17

3,788,237

519

16.8%

185,234

26-Mar

4,846

346

1028

1,552

26,311,027

3,597

1.70

5.44

4.47

4.17

3,918,430

536

15.6%

193,351

12-Mar

4,631

331

1076

1,623

25,191,074

3,606

1.66

5.05

4.06

4.14

3,926,091

562

16.4%

193,728

26-Feb

4,850

346

1085

1,639

24,595,750

3,358

1.55

5.08

4.28

4.15

3,949,007

539

16.9%

191,515

12-Feb
12
Feb

4,558

326

1024

1,549

24,293,088

3,523

1.60

4.67

4.19

4.14

3,906,335

567

16.9%

192,272

29-Jan

4,248

303

956

1,481

22,428,151

3,409

1.69

5.11

4.36

4.13

3,930,063

597

18.4%

191,402

15-Jan

4,370

312

942

1,506

23,374,107

3,346

1.71

4.72

3.94

4.10

3,875,184

555

17.4%

192,739

1-Jan

3,258

233

762

1,265

17,355,369

3,209

1.44

4.96

4.27

4.12

3,284,681

607

19.9%

161,567

18-Dec

4,078

291

829

1,335

22,832,786

3,476

1.77

4.97

4.32

4.10

3,880,175

591

17.8%

192,694

4-Dec

3,561

254

806

1,283

19,317,205

3,409

1.62

4.44

3.94

4.05

3,489,176

616

19.0%

172,031

20-Nov

3,882

277

886

1,421

21,193,561

3,404

1.66

4.32

3.90

4.08

4,178,884

671

20.7%

189,003

6 Nov
6-Nov

3 636
3,636

260

848

1 380
1,380

21 389 769
21,389,769

3 615
3,615

1 86
1.86

5 84
5.84

4 38
4.38

4 14
4.14

3 639 902
3,639,902

615

17 9%
17.9%

185 477
185,477

23-Oct
9-Oct
25-Sep
11-Sep
28-Aug
14-Aug
31-Jul
17-Jul
3-Jul
19-Jun
5-Jun
22-May
8-May
24-Apr

3,903
3,589
3,988
3,769
3,757
3,660
3,802
,
3,706
3,610
4,076
3,882
4,113
3,994
4,192

279
256
285
269
268
261
272
265
258
291
277
294
285
299

852
856
931
876
867
876
911
836
887
919
849
879
879
890

1,347
1,407
1,480
1,400
1,422
1,403
1,470
,
1,327
1,434
1,451
1,317
1,361
1,350
1,420

21,644,155
20,509,004
22,161,491
20,438,586
20,031,816
19,589,212
20,388,398
,
,
20,032,527
19,477,485
20,748,494
19,630,918
21,087,293
21,276,421
21,539,017

3,507
3,478
3,496
3,393
3,250
3,342
3,324
,
3,405
3,337
3,224
3,260
3,310
3,469
3,220

1.73
1.39
1.76
1.71
1.56
1.59
1.66
1.71
1.63
1.66
1.60
1.73
1.71
1.74

4.46
5.15
4.42
4.82
4.52
4.51
4.84
4.32
4.60
5.18
4.81
5.21
4.83
4.53

3.98
4.07
3.87
3.91
4.00
3.86
4.23
3.74
4.05
4.30
4.36
4.16
4.33
3.96

4.03
4.07
4.20
4.21
4.22
4.23
4.25
4.25
4.27
4.29
4.28
4.28
4.29
4.28

3,583,377
3,554,936
3,623,279
3,592,145
3,590,471
3,494,706
3,472,912
,
,
3,443,647
3,448,446
3,458,228
3,392,819
3,508,920
3,456,636
3,434,163

581
603
572
596
582
596
566
585
591
537
563
551
564
513

17.4%
18.2%
17.2%
18.5%
18.8%
18.7%
17.9%
18.0%
18.6%
17.5%
18.1%
17.5%
17.1%
16.7%

182,247
183,685
185,751
181,557
185,106
180,619
180,077
,
175,380
175,706
176,952
171,421
177,557
174,994
174,501

This is sent to all executives and management

It is a snapshot of actual versus budget. It helps the organization to review trends. Action
can be taken as appropriate. This is sent out 4 5 days after the period closes due to pay
period closing schedule.

45

KDMC Biweekly
d
ProductivityReporting
Nursing Facility

DEPT # 12/4 12/18

70200
7.98
9.31

1/1
1/15
1/29 2/12 2/26 3/12 3/26
9.08
9.26
8.16 6.87 8.21 7.39 7.44

BUDG
4/9
HPPD
7.38
7.75

%
FTE
Var
Var
4.80% 0.60

Medical Step Down

70400

8.94

8.78

9.40

8.73

9.32 8.02 7.73 8.04 8.08

8.12

9.00

9.81%

3.58

Resp Step Down

70500

9.19

9.61

10.58

9.91

10.15 9.45 8.83 8.34 9.08

8.71

10.00

12.92%

5.67

Cardiac Surgery Unit

70600

11.89

12.71

13.44

10.96

11.31 10.55 9.94 11.20 10.16

9.53

11.88

19.77%

9.33

Chest Pain Center

70701

13.95

13.41

17.08

12.88

13.40 12.50 11.17 10.51 10.42

10.74

12.04

10.77%

2.18

Surgical
g North

70800

11.02

10.66

12.28

10.07

9.93 9.55 8.79 8.10 8.53

9.17

9.60

4.46%

1.45

Cardiac Stepdown

71200

11.14

10.02

9.89

10.06

11.25 9.45 8.91 8.31 8.40

7.94

10.00

20.61%

9.49

Cardiac Cath Recovery

71300

17.93

15.69

29.73

13.84

12.91 13.86 11.92 12.11 13.06

11.95

13.78

13.27%

3.57

Cancer Resource Center

71400

10.12

9.45

9.66

8.44

9.74 7.80 8.13 7.86 9.03

8.10

9.00

10.04%

3.55

Observation

71600

12.20

11.18

13.28

9.75

8.80 8.28 8.16 7.38 7.72

7.75

9.50

18.47%

8.23

Family Practice

71800

9.62

7.59

8.71

8.19

7.96 7.48 7.70 7.13 7.18

7.07

9.00

21.42% 10.35

OBGYN

72000

11.12

9.22

9.39

9.07

10.05 10.79 7.61 8.37 9.28

8.65

9.70

10.79%

NRSY

72200

6.64

5.90

6.74

6.81

8.89 7.06 6.49 7.02 5.78

7.53

7.00

-7.56% (0.66)

Pediatrics

72400

8.90

8.74

9.61

8.72

8.48 8.14 7.65 8.57 8.48

8.19

9.00

9.01%

2.53

R h bili i
Rehabilitation

72500

12 63
12.63

13 16
13.16

14 21
14.21

13 15
13.15

12 25 12.80
12.25
12 80 11.67
11 67 11.87
11 87 11.20
11 20

10 72
10.72

11 90
11.90

9 92%
9.92%

5 22
5.22

Behavioral Medicine

72600

12.65

11.64

14.60

10.02

10.51 10.87 9.81 10.41 10.40

9.60

11.00

12.73%

5.74

ICU

73000

25.64

25.09

25.26

24.35

24.19 24.01 23.99 25.08 24.02

24.02

25.50

5.80%

5.69

Cardiovascular ICU

73100

24.43

20.98

27.12

24.43

27.46 26.23 25.99 25.41 24.40

20.78

26.50

21.57%

5.36

NICU

73400

14.57

20.50

22.07

15.74

13.32 18.41 18.20 14.13 16.24

15.71

17.00

7.61%

1.75

1.91

This is a major initiative at KDMC, since salaries are the biggest expense. Productivity reports are sent out
4 5 days after the period closes. Departments need to review their variances, high and low, and move back
into compliance. Trends are the most important indicators on this page. If trend is down, then written
explanations of productivity variances are required.

46

KDMC Monthly
Monthly
KDMC
SummaryofOperations(KeyIndicators)
King's Daughters Medical Center
Summary of Operations
Period Ending September 30, 2007
Current Month
Actual

Budget

Year To Date
% Var
Budget

Prior

% Var
Prior Yr.

Actual

$785,876
$785
876
$336,229
1.3%
2.9%
$139,305,210

$1,085,842
$1
085 842
$856,856
3.9%
4.9%
$121,417,035

$846 727
$846,727
$698,907
3.2%
3.8%
$114,654,581

-27 6%
-27.6%
-60.8%
-2.6%
-2.0%
14.7%

-7 2%
-7.2%
-51.9%
-1.9%
-0.9%
21.5%

Consolidated Results:
Net Income
Operating Income
Operating Margin Percentage
Total Margin Percentage
Cash Balance

1,923
3,131
38.2%

1,635
2,775
40.7%

1,717
2,891
40.2%

17.6%
12.8%
-2.50%

12.0%
8.3%
-2.01%

King's Daughters Medical Center Results:

Admissions
Adjusted Admissions
O/P Revenue % Total Revenue

49.5%
15.3%
28.4%
6.8%

49.5%
15.7%
29.6%
5.2%

48.8%
15.9%
28.9%
6.4%

0.00%
-0.40%
-1.20%
1.60%

0.70%
-0.60%
-0.50%
0.40%

Medicare Utilization
Medicaid Utilization
Insurance Utilization
Self Pay Utilization

4.68
3.93
1 76
1.76
1.41

4.98
4.26
1 56
1.56
1.31

5.25
4.42
1 60
1.60
1.33

6.02%
7.75%
12 82%
12.82%
7.56%

10.86%
11.09%
10 34%
10.34%
6.10%

Average Length of Stay- Medicare

Average Length of Stay- Combined
Case Mix Index - Medicare
Case Mix Index - Combined

$5,866
$5,803
30.36

$5,878
$5,656
28.10

$5,569
$5,380
28.47

-0.2%
-2.6%
-8.06%

5.3%
-7.9%
-6.65%

Net Revenue/Adj Admissions (Case Mix Adj)

Cost per Adjusted Admission (Case Mix Adj)
Total Paid Hours per Adjusted Patient Day

$724,760
1.1%
2.8%

$1,033,800
3.8%
4.8%

$871,438
3.4%
4.1%

-29.9%
-2.7%
-2.0%

-16.8%
-2.3%
-1.3%

Net Income
Operating Margin Percentage
Total Margin Percentage

Budget

Prior

$27 473 861

$27,473,861
$23,536,569
7.5%
8.8%
$139,305,210

$14 515 421

$14,515,421
$11,767,513
4.4%
5.4%
$121,417,035

$12 510 734

$12,510,734
$12,244,699
4.8%
4.9%
$114,654,581

22,921
37,188
37.9%

20,626
34,314
39.5%

20,580
33,587
38.3%

48.0%
15.3%
30.5%
6.1%

49.5%
15.7%
29.6%
5.2%

49.2%
15.8%
29.8%
5.2%

5.00
4.20
1 62
1.62
1.35

4.98
4.26
1 56
1.56
1.31

5.03
4.29
1 57
1.57
1.31

$6,010
$5,557
28.47

$5,814
$5,567
28.14

$5,648
$5,371
28.08

$26,756,117
7.5%
8.8%

$13,861,417
4.3%
5.3%

$12,463,415
4.9%
5.0%

47

KDMC Monthly
HospitalStatisticsReport
King's Daughters Medical Center
Statistical Indicator Report
Period Ending September 30, 2007
Current Month
Actual

Budget

Prior

Year to Date
% Var
Budget

% Var
Prior Yr

Actual
Hospital Volumes
Admissions
Adjusted Admissions
Average Daily Census
Surgical Procedures and C-Sections
C Sections
Same Day Surgery Procedures
Open Heart Surgery Procedures
Cath Lab Procedures
Angioplasty Procedures
Emergency Department Visits
Deliveries
Observation Days
Laboratory Procedures
Radiology Procedures
MRI Procedures
Ultrasounds
CT Scans
Home Health Visits
Family Care Center Visits

1,923
3,131
276
1 193
1,193
1,698
66
960
160
5,864
140
474
65,678
8,847
819
1,501
2,751
2,389
9,963

1,635
2,775
251
884
1,330
53
620
99
5,787
107
420
59,110
8,694
848
1,206
2,532
1,911
11,209

1,717
2,891
263
1 009
1,009
1,526
50
596
77
5,880
123
462
62,444
8,972
848
1,380
2,658
2,583
10,642

17.6%
12.8%
9.7%
35 0%
35.0%
27.7%
24.5%
54.8%
62.1%
1.3%
30.8%
12.9%
11.1%
1.8%
-3.4%
24.5%
8.6%
25.0%
-11.1%

12.0%
8.3%
4.9%
18 2%
18.2%
11.3%
32.0%
61.1%
107.8%
-0.3%
13.8%
2.6%
5.2%
-1.4%
-3.4%
8.8%
3.5%
-7.5%
-6.4%

2,391
,
5.33
30.36
$2,551
$20.11

2,102
,
4.93
28.10
$2,556
$20.40

2,209
,
5.00
28.47
$2,527
$19.91

-13.8%
-8.1%
-8.1%
0.2%
1.4%

-8.2%
-6.7%
-6.7%
-1.0%
-1.0%

53.6
5.9%

59.5
5.2%

60.3
2.9%

10.0%
-0.6%

Hospital Credit & Collections

11.2% Net Days in Accounts Receivable
-3.0% Bad Debt & Charity % Total Patient Revenue

10.60%
$1,631

10.05%
$1,417

11.39%
$1,559

-0.5%
-15.1%

Hospital
i Supply
S
Management
0.8% Supply Expense % of Total Patient Revenue
-4.6% Supply Expense per Adjusted Admission

Hospital Labor Costs

Total FTE's,, Includingg Contract Employees
p y
FTE's per Adjusted Occupied Bed
Total Paid Hours per Adjusted Patient Day
Salary Expense per Adjusted Admission
Average Hourly Wage

Budget

Prior

% Var
Budget

22,921
37,188
283
13 359
13,359
19,260
697
9,338
1,602
69,398
1,465
5,093
798,613
108,122
9,679
17,303
32,213
29,589
130,540

20,626
34,314
260
11 790
11,790
17,462
620
7,160
1,140
67,048
1,286
5,104
710,270
107,178
9,537
15,600
29,710
28,897
135,020

20,580
33,587
260
11 771
11,771
17,169
576
6,984
1,125
67,094
1,313
5,039
705,946
104,592
9,187
14,797
28,997
29,153
109,923

11.1%
8.4%
8.5%
13 3%
13.3%
10.3%
12.4%
30.4%
40.5%
3.5%
13.9%
-0.2%
12.4%
0.9%
1.5%
10.9%
8.4%
2.4%
-3.3%

2,289
,
5.00
28.47
$2,524
$20.26

2,140
,
4.94
28.14
$2,539
$20.21

2,089
,
4.93
28.08
$2,468
$19.67

-7.0%
-1.2%
-1.2%
0.6%
-0.2%

53.6
5.3%

59.5
5.2%

60.3
4.7%

10.0%
-0.1%

10.21%
$1,505

10.01%
$1,408

11.39%
$1,371

-0.2%
-6.9%

48

KDMC Monthly
KDMC
DepartmentalStatisticalReport
71400 Cancer Resource Center
Period Ending Marchc 2007

CURRENT MONTH
Actual Flex Bud Last Year Flex Var
717
9
726

YEAR TO DATE
Actual Flex Bud Last Year Flex Var

Pct
DAYS & STATS
DAYS
OP STATS
TOTAL STATISTICS

676
19
695

,
6,142
8.46
34.8

6,534
,
9.00
37

5,587
,
8.04
31.6

392
0.54
2.2

6
6
5.95

441.38

455.08

446.78

-13.7

-3.01

174.1
16.09
193.08

195.75
16.49
217.02

166.28
12.33
184.02

21.65
0.4
23.94

11.06
2.43
11.03

HOURS
HOURS/STAT
FTES

3,661
86
3,747

Pct

3,740
156
3,896

33,800
,
9.02
32.6

33,723
,
9.00
32.5

32,043
,
8.22
30.9

-77
-0.02
-0.1

-0.23
-0.22
-0.31

TOTAL REVENUE/STAT

439.7

450.21

442.01

-10.51

-2.33

SALARIES/STAT
SUPPLIES/STAT
TOTAL EXPENSES/STAT

185.69
16.47
206.74

193.32
16.75
215.48

168.75
16.67
193.86

7.63
0.28
8.74

3.95
1.67
4.06

49

KDMC Monthly
ProductivityGraph
HPPD StaffingTornado FYTD thru March 2007 for Nursing Units

Goal 0
0.00%
00%

Clinic al Res ource Team

28.2%
11.9%
11.6%

Labor & Deliv ery

Neonatal ICU

7.6%
6.1%
5 5%
5.5%
4.6%
4.3%
3.9%
3.0%
1.1%
0 5%
0.5%
0.3%

Family Prac tic e

Respiratory Step-Down
Cardiov ascular ICU
Cardiac Surgery Unit
Newborn Nurs ery
Obs tetrics /Gynec ology
Pediatric s
Medic al Step-Down
Behav ioral Medic ine
Obs erv ation

-0.2%
-0.6%
-0.8%
-1.4%
-2.8%

Cancer Resourc e Center

Cardiac Step-Down
Surgery /Ortho
ICU
Cardiac Cath Rec ov ery
Rehabilitation
Skilled Nursing
Ches t Pain Unit

-6.2%
-6.8%
-8.6%

15.0%
0% -10
10.0%
0%
-15

-5
5.0%
0%

0 0%
0.0%

5 0%
5.0%

10 0%
10.0%

15 0%
15.0%

20 0%
20.0%

25 0%
25.0%

30 0%
30.0%

35 0%
35.0%

This is used by executives and management to quickly show the department that
didor did not, meet their productivity goals. This is also used at the monthly
leadership meeting for all the divisions. It is meant to create peer pressure and
competition. Nobody wants to be in the red, according to Paul McDowell.

50

JPS Health Network (Fort Worth TX)

JPSHealthNetwork(FortWorthTX)
VitalStatistics
FACILITIES:
Number of Hospitals in the Health System
Number of Total Entities in Health System
Total number of licensed beds
Total admissions
Annual Outpatient Visits
Annual Emergency Department Visits

1
25
459
19 453
19,453
683,000
63,700

FINANCIAL RESULTS:
Net Revenues
Operating Margin Percentage
Days Cash on Hand

$ 433
433,892,000
892 000
8.3%
181

PAYER MIX PERCENTAGE:

Medicare
Medicaid
Managed Care
Charity
Unisnsured

16.0%
37.0%
6.0%
29.0%
12.0%

Total

100.0%

51

JPSHealthNetwork
Background
gg
y GalePileggi,CFO
y Weoweittoourcountyresidentstobethemostefficientand

effectivefacilitywecanpossiblybe.Ibelievethattheproper
reportingofinformationcanhelpthisgreatly.BeforeIcame
herethreeyearsago,verylittlereportingtookplace.Aculture
changewasinorder
h

i d

y CFOatJPSforthreeyears
y Backgroundintwodifferentforprofitsystems,over11years;15yearsin

anonprofitChildrensHospital

y JPSisaHospitalDistrict,whereAdValoremTaxesprovidea

substantialamountoftaxmoney($205million)totheoperationof
thefacility.
y Ifthefacilityisabletooperatemoreefficiently,thegovernment
Ifthefacilityisabletooperatemoreefficiently thegovernment
moneywillbeutilizedtogenerate
y Morevolumes(communitygoal)
y Atlowerunitcosts
y Investmentincapitalequipmentandfacilities
I
i i l
i
df ili i

52

JPS TypesofFinancialReports
y Daily theusual
y Volumes
y
y

Inpatientdays,admissionsanddischarges
O
Outpatientvolumes
i l
generallychargebased
ll h
b d
y

Managersaredirectedbacktotheirdailystatisticsiftheyargueabout
theirbiweeklyormonthlyvolumes

y Chargeeditreports

y Weekly
y CEOExecutiveOperatingSummary
y
y

Thishastheelementsfromthemonthlyboardandadministrative
reports withweeklyactualandbudgetinformation
reports
Thisisusedtodeterminethattheorganizationstayswithinitsgoalsona
timelybasis,notwaitingforthemonthlyreportgeneration,whenitis
toolatetoaffecttheoutcomes

53

JPS TypesofFinancialReports
y Biweekly
y LaborReporting
y

Productivityreporting
y p
g
y

Weinvestedalotoftimeindevelopingproductivitystandardsandwe
expectthemanagementteamtoachievethesestandardsonabiweekly
basis.Ourmanagementteamfindthesereportsinvaluablein
measuringpastperformanceandplanningfuturestaffing.Webelieve
i h
inthesereportsmorethanthemonthlylaborreporting,becausethe

h h
hl l b
i b
h
accrualsonthemonthlyreportsincludeestimatesthatdistortthe
varianceanalysis.,whilethebiweeklytotalsarereal.

y Monthly
y
y BoardFinancePackage
y

PreparedforandsenttoAdministratorsandBoardmembers

y DepartmentManagerPackage
p
g
g

54

JPS
JPS
UseofBenchmarks
y JPShasusedlaborbenchmarksdevelopedbya
h
dl b b
h
k d l
db

consultingfirm
y Recentlyjoinedoneofthebigthreehospital
yj
g
p
b
benchmarkingfirmstoexpandontheuseoflabor
h
k
f
d
h
fl b
andnonlaborbenchmarks
y JJPSsetsitsbenchmarkedgoalsfornewmetrics
g
f
th
h
atthe50
h
percentile
l
y Thereisasteadymovementofthispercentile
goalfromthe50
g
f
5 th tothe75
75th,,astheJPS
J
administrationbelievesthattheycanand
d
b l
h
h
d
shouldbeconsiderablybetterthanthe
median.
55

JPS Daily
D
S i i R
i
DepartmentStatisticsReporting
Departmental Stats - Units

4/27/2007
14

Actual Labor Hours - Productive Overtime

Actual Labor Dollars - Productive Overtim
Actual Overtime Rate/Hour

4/28/2007
16

4/29/2007
17

4/30/2007
18

5/1/2007
16

7
330
45

19
856
45

28
777
27

22
780
36

5/2/2007
16

5/3/2007
14

Actual Labor Hours - Productive Regular

Actual Labor Dollars - Productive Regular
Actual Regular Rate/Hour

217
4,679
22

181
3,770
21

158
3,167
20

173
4,406
25

156
4,064
26

190
4,152
22

215
4,744
22

Total Actual Productive Hours

Total Actual Productive Dollars
Actual Productive Rate/Hour

217
4,679
21.58

188
4,100
21.82

177
4,023
22.70

202
5,183
25.69

178
4,843
27.21

190
4,152
21.87

215
4,744
22.11

22
24
15
11
334
257

22
24
12
11
256
257

23
24
10
11
237
257

26
24
11
11
288
257

27
24
11
11
303
257

22
24
12
11
259
257

22
24
15
11
339
257

g
Productive Hours
Budgeted
Actual Productive Hours
Productive Hours Variance
Efficiency Variance Cost

152
217
-65
-1,539

173.60
188
-14
-339

184.45
177
7
171

195.30
202
-6
-154

173.60
178
-4
-104

174
190
-16
-384

152
215
-63
-1,487

Budgeted Productive Dollars

Actual Productive Dollars
Productive Rate Variance

5,141
4,679
462

4,455
4,100
355

4,203
4,023
180

4,784
5,183
-399
399

4,220
4,843
-623
623

4,500
4,152
349

5,088
4,744
344

-1,077

16

350

-553

-727

-35

-1,143

Actual Productive Rate/Hour

Budgeted Rate/Hour
Actual Productive Hours/Unit
Budgeted Productive Hours/Unit
Actual Productive Cost/Unit
Budgeted Productive Cost/Unit

Total Variance Favorable (Unfavorable)

This daily report

is available,
online, to the
department
managers, by mid
morning of the
following day.
Managers are
expected to check
the recorded
volumes
l
andd
ensure that they
are correct.
Managers are
not able to
complain about
their monthly
statistics if they
have not been
reviewing their
daily statistical
indicators.

56

JPS Weekly
Executive Report
ExecutiveReport
Current Period
Actuals 2003

Current Period Actuals Oct 2004

2004*
Actuals*

Nov 2004
Actuals*

Dec 2004
Actuals*

Jan 2005
Actuals*

Feb 2005
Actuals*

Mar 2005
Actuals*

4/1-4/2*

4/3-4/9*

4/10-4/16* 4/17-4/23*

Admits

15,007
2,083
5 814
5,814
256
41.1

16,815
2,077
5 947
5,947
264
45.9

1,500
145
525
25
48.4

1,501
147
470
23
50.0

1,540
151
494
26
49.7

1,503
173
454
20
48.5

1,397
170
456
26
49.9

1,533
184
427
27
49.5

4.8
16.4
1.5
6.3

5.1
17.8
2.9
6.4

5.2
16.6
3.9
6.9

5.0
17.5
4.0
6.4

4.8
16.4
4.5
5.9

5.2
21.5
4.6
6.2

5.3
15.0
4.2
7.4

5.2
16.6
4.2
7.2

71,890
13,722
16,496
4,200

85,583
14,479
17,436
4,689

7,800
1,182
1,684
415

7,451
1,017
1,189
402

7,422
1,117
1,424
426

7,864
1,219
1,411
430

7,335
1,290
1,169
391

7,955
1,430
1,294
448

71,075
12,335
17,100
4,283
194.7
33.8
46.8
11.7

86,131
12,941
17,712
4,671
235.3
35.4
48.4
12.8

7,793
1,038
1,718
416
251.4
33.5
55.4
13.4

7,490
990
1,213
402
249.7
33.0
40.4
13.4

7,448
1,042
1,429
426
240.3
33.6
46.1
13.7

7,863
1,089
1,407
432
253.6
35.1
45.4
13.9

7,309
1,135
1,161
392
261.0
40.5
41.5
14.0

7,927
1,267
1,290
446
255.7
40.9
41.6
14.4

3,101
3,291

3,745
3,607

319
326

365
311

274
261

362
268

318
301

Acute Care Admits

Behavioral Admits
Newborn Admits
SNF Admits
Avg Acute Admits

74
7
24
4
37.0

333
36
104
4
47.6

329
40
83
4
47.0

347
38
113
4
49.6

6.4
6.3
3.5
10.1

5.2
26.3
4.9
6.2

5.5
25.8
4.6
6.9

5.5
25.8
4.5
6.4

475
75
87
25

1,738
298
315
105

1,798
312
268
103

1,902
302
283
103

476
64
87
27
238.0
32.0
43.5
13.5

1,745
262
314
105
249.3
37.4
44.9
15.0

1,765
285
270
103
252.1
40.7
38.6
14.7

1,888
268
283
104
269.7
38.3
40.4
14.9

10
21

65
45

95
91

88
71

27
199
84
60
19
1,251

102
1,105
312
263
73
8,115

99
1,231
269
234
104
8,510

116
1,243
340
245
84
8,446

LOS
Acute LOS
SNF LOS
Medicaid LOS
Medicare LOS
Patient Days
Acute Days
B h i lD
Behavioral
Days
Newborn Days
SNF Days
Census
Acute Census
Behavioral Census
Newborn Census
SNF Census
Avg Acute Census
Avg Behavioral Cen
Avg Newborn Cens
Avg SNF Census
Surgical Procedure

373 Inpatient Surgeries

325 Outpatient Surgerie
Other Statistics

5,262
51,881
13,380
13,975
0
369,348

5,984
54,028
13,510
14,447
1,072
396,473

572
4,512
1,236
1,231
427
33,717

497
4,221
1,198
1,062
370
32,286

490
4,474
1,182
1,093
442
31,120

452
4,548
1,267
1,089
322
34,100

473
4,044
1,218
1,079
324
34,010

431
4,941
1,304
1,122
363
38,334

294,885.3
301,048.7
595,934.0
807.9
824.8
1,632.7

395,003.3
261,616.1
656,619.4
1,079.2
714.8
1,794.0

42,337.5
27,260.9
69,598.4
1,365.7
879.4
2,245.1

39,697.2
25,537.7
65,234.9
1,323.2
851.3
2,174.5

41,291.2
25,391.0
66,682.2
1,332.0
819.1
2,151.0

43,030.0
27,417.9
70,447.9
1,388.1
884.4
2,272.5

40,006.2
26,021.7
66,027.9
1,428.8
929.3
2,358.1

45,277.4
30,797.4
76,074.8
1,460.6
993.5
2,454.0

Deliveries
ER Visits
Psych ER Visits
OB Triage Visits
Cath Lab Procedur
Clinic Visits
Financial
Inpatient Revenue

2,517.4

Outpatient Revenue 1,228.1

Gross Revenue

3,745.5

Avg Inpatient Reven 1,258.7

Avg Outpatient Rev

614.0

Avg Gross Revenue 1,872.7

9,492.5 10,309.9 10,201.3

6,368.2 6,991.2 6,986.4
15,860.7 17,301.1 17,187.6
1,356.1 1,472.8 1,457.3
909.7
998.7
998.1
2,265.8 2,471.6 2,455.4

This report was created to give the CEO a snapshot of key indicators in a timely manner. It
prepares the administrators for the monthly outcomes. It is used as an action report,
requiring the managers to take remedial action to achieve monthly goals.
Ongoing staffing is driven by changes to this report, according to the CFO.

57

JPS BiweeklyLaborReport
VolumeAdjustedVariances Dollars
Salary and Wage Report Productive Only
Volume Adjusted Variance Analysis
Pay Period Ending Mar 13, 2007 YTD
Routine Areas
Units

Admin
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE

Cost
Center
CC612
CC618
CC619
CC621
CC622
CC626
CC640
CC646
CC648
CC650
CC651
CC654
CC663
CC668
CC670
CC761

Cost Center Name

Budget
PROGRESSIVE CARE WEST
3 382
3,382
TOWER FIVE
3,404
TELEMETRY NORTH
2,704
TOWER SEVEN
4,609
PROGRESSIVE CARE EAST
3,515
TOWER ELEVEN
2,787
ICU
3,019
2 SOUTH
3,215
2 NORTH
3 127
3,127
NEWBORN NURSERY
3,464
NEONATAL ICU
2,509
1,324
CONTINUING CARE NURSERY
TOWER SIX
4,346
TOWER TWO
3,180
LABOR & DELIVERY
4,449
SKILLED NURSING FACILITY
2,362

Actual
3 557
3,557
3,843
2,583
4,168
3,548
2,746
3,007
2,614
3 201
3,201
4,183
3,060
489
4,302
2,809
4,316
2,317

Salary and Wage

Var
175
439
(121)
(441)
33
(41)
(12)
(601)
74
719
551
(835)
(44)
(371)
(133)
(45)

Budget
841 740
841,740
658,578
636,128
959,343
893,136
522,754
1,699,252
599,276
517 795
517,795
386,537
1,031,576
214,146
823,695
722,888
1,422,463
344,807
12 274 117
12,274,117

Actual
988 240
988,240
777,915
688,838
975,706
962,671
594,487
1,667,444
772,056
617 292
617,292
467,996
1,259,186
52,010
804,362
628,994
1,301,131
370,161
12 928 489
12,928,489

SW per Unit

Var
146,500
146
500
119,336
52,710
16,363
69,535
71,733
(31,807)
172,780
99 496
99,496
81,459
227,609
(162,136)
(19,333)
(93,895)
(121,332)
25,354
654 372
654,372

Budget
248 89
248.89
193.47
235.25
208.15
254.09
187.57
562.85
186.40
165 59
165.59
111.59
411.15
161.74
189.53
227.32
319.73
145.98

Actual
277 83
277.83
202.42
266.68
234.09
271.33
216.49
554.52
295.35
192 84
192.84
111.88
411.50
106.36
186.97
223.92
301.47
159.76

Var
28 94
28.94
8.95
31.43
25.95
17.23
28.92
(8.33)
108.95
27 25
27.25
0.29
0.35
(55.38)
(2.56)
(3.40)
(18.26)
13.78

Both this report (dollars) and the report on the next page (hours), are used extensively by
the administrators to ensure that the managers are meeting their biweekly labor goals.
These reports have even greater significance than the monthly labor reports because they
d nott contain
do
t i any monthly
thl accruals.
l (A
(Accruals
l are kill
killers
according
di tto th
the CFO)
The administrators rely on this report rather than the monthly report because it is
- More timely, and
- absolutely accurate

58

JPS BiweeklyLaborReport
Biweekly Labor Report
JPS
VolumeAdjustedVariances Hours
Payroll Hours Report Productive Only
Volume Adjusted Variance Analysis
Pay Period Ending Mar 13, 2007
Routine Areas

Units

Admin

Cost
Center

Cost Center Name

LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE
LOWE

CC612
CC618
CC619
CC621
CC622
CC626
CC640
CC646
CC648
CC650
CC651
CC654
CC663
CC668
CC670
CC761

PROGRESSIVE CARE WEST

TOWER FIVE
TELEMETRY NORTH
TOWER SEVEN
PROGRESSIVE CARE EAST
TOWER ELEVEN
ICU
2 SOUTH
2 NORTH
NEWBORN NURSERY
NEONATAL ICU
CONTINUING CARE NURSER
TOWER SIX
TOWER TWO
LABOR & DELIVERY
SKILLED NURSING FACILITY

Budget

Actual

301
285
237
386
300
244
260
222
216
209
175
92
360
273
279
203

294
327
214
358
296
230
242
184
237
270
205
76
365
262
279
198

Hours

Var

(7)
42
(23)
(28)
((4))
(14)
(18)
(38)
21
61
30
(16)
5
(11)
0
(5)

Budget

3,106
2,455
2,272
3,290
3,295
,
2,119
4,960
2,206
1,762
1,122
2,947
790
2 972
2,972
2,373
4,514
1,378
41,563

Hours per unit

Actual

Var

3,328
2,907
2,512
3,509
3,339
,
2,140
4,912
2,067
2,160
1,529
3,478
209
3 141
3,141
2,425
4,346
1,434
43,437

222
451
240
219
44
21
(48)
(138)
398
408
531
(581)
168
51
(168)
55
1,874

Budget

10.32
8.62
9.59
8.52
10.98
8.69
19.08
9.94
8.16
5.37
16.84
8.59
8 26
8.26
8.69
16.18
6.79

Actual

11.32
8.89
11.74
9.80
11.28
9.30
20.30
11.24
9.11
5.66
16.97
2.75
8 61
8.61
9.25
15.58
7.24

Var

1.00
0.27
2.15
1.28
0.30
0.62
1.22
1.30
0.96
0.30
0.13
(5.83)
0 35
0.35
0.56
(0.60)
0.45

See previous page for discussion on importance of this page

59

JPS BiweeklyDepartmentalProductivity
Biweekly Departmental Productivity
JPS
Report

Labor Dollars - Productive Contr

Contract Rate/Hour

Labor Hours - Productive Overtim

L b Dollars
Labor
D ll
- Productive
P d ti Overt
O
t
Overtime Rate/Hour

230
7,667
7
667
33

2 879
2,879

230
4,788
4
788
33

4,064
131,054
131
054
32

Labor Hours - Productive Regula

Labor Dollars - Productive Regul
Regular Rate/Hour

2,664.74
62,262.31
23

3,001.05
71,081.26
24

(336.31)
(8,818.95)
(0)

45,149.88
1,081,660.11
24

Total Productive Hours

Total Productive Dollars
Total Productive Rate/Hour

2,894.58
69,929.56
24

3,001.05
73,960.17
25

(106.47)
(4,030.61)
(0)

49,213.67
1,212,714.28
25

24.16
12.98
314

24.64
10.60
261

(0.49)
2.38
52

24.64
11.39
281

13,056.60
(1,406.61)
11,650

13,056.60
(1,406.61)
11,650

84,014.58
10,462.51
94,477

((15,680.60))
(4,030.61)

((15,680.60))
(4,030.61)

37,533.42
132,010.51

(303.34)
(6,127.81)
0.44
2
49 70
49.70

52,833.96
1,325,363.54
25.09
12
306 80
306.80

9,762
1,320.85
11,083.19

59,996
39,485.78
99,481.50

Productive Rate/Hour
Productive Hours/Unit
P d ti Cost/Unit
Productive
C t/U it
Hours Variance
Rate Variance
Spending Variance
Volume Variance
Total Variance - Productive
Productive and Non Productive H
Payroll Dollars Productive and N
Total Rate/Hour
Total Hours/Unit
Total Cost/Unit

3,002.58
75,050.73
25.00
13
336 55
336.55

Hours Variance
Rate Variance
Total Spending Variance

9,762
1,320.85
11,083.19

3,305.92
81,178.54
24.56
12
286 85
286.85

This biweekly
labor report is
sent to the
department
managerss on a
manage
timely basis.
The managers
are expected to
meet their labor
goals.
l
Actions are
initiated if the
goals are not met.

60

JPS MonthlyAdministrative&Board
Monthly Administrative & Board
JPS
ReportingPage KeyFinancialRatios
FYE 2007

Aa Rating

8.3%

3.3%

Current Ratio

3.5

1.8

Days of cash on hand

207

225

192

225

Accounts Receivable days

59 #

56

Debt-to-Capitalization

12%

34%

Operating Margin

Days of cash on hand (excluding

self insurance trust funds and
prior year adjustments in FY03)

See next page

# Three month average

This is one of the first pages of the monthly Board report. It was developed to give the
Leadership a snapshot of the hospitals financial position. In fact, these ratios were
determined based on the ratios used by the BOND RATING AGENCIES, and are set to
achieve high ratings. The current bond ratings for JPS are:
Moodys
A2
Standard and Poors
AA

61

JPS MonthlyBoardReporting
DebttoCapitalization(%)
66.20%

70.00%
60.00%

51.00%

50.00%

39.80%

40.00%

33.60%

30.00%
17.67%
16.06%

20 00%
20.00%
10.00%
0.00%

14.67%

12 16%
12.16%

6.65%

FY 2001

FY 2002

FY 2003

FY 2004

06 Proforma

Aa

Baa

<Baa

Pro forma assumes the issuance of $35 million in Certificates of Obligation.

Debt-to-capitalization (%)

Long-term debt + short term-debt

Long-term debt + short-term debt + unrestricted fund balance

This is one of several pages reported to the Board, providing additional trending
information around the indicators on the previous page.

62

JPS MonthlyBoard ReportingPageKey

OperatingIndicatorsFortheMonth
November November
2004
Budget
Admissions

Budget
Variance
%

Prior
Year
November
Variance %
2003

1,695

1,623

4%

1,521

11%

6.7

6.2

8%

6.3

6%

j
Pt Days
y
Adjusted

17,382
,

18,055
,

((4%))

16,066
,

8%

Total OP Visits

54,128

56,004

(3%)

51,487

5%

Net Rev/APD

$649

$560

16%

$572

14%

Length of Stay
(Acute Medical/Surgical)

(net of bad debts)

The reports on this page and the next page represent truly important indicators to the Board and
Administration of JPS. These raw numbers and ratios are the primary indicators that are used to
develop the annual operating budgets.
budgets Standards are set around these indicators using
- in some cases, external benchmarks, and
- internal trends across years.
The Board is very attuned to the number on these two pages, according to Gale Pileggi, CFO.

63

JPS MonthlyBoard
Monthly Board ReportingPage
Reporting Page
JPS
KeyOperatingIndicatorsFortheMonth
November
2007

November
Budget

Budget
Variance
%

November
2006

Prior Year
Variance
%

FTE/APD

5.0

4.6

9%

5.2

(4%)

SWB/APD

$783

$770

2%

$837

( )
(6%)

Supplies/APD

$304

$293

4%

$306

(1%)

Op Exp/APD*

$1,688

$1,627

4%

$1,708

(1%)

Net Income ($000)

$1,148

$497

$525

* Excludes bad debts, depreciation and interest

See previous page for discussion on importance of this page

64

Ingalls Health System (Harvey IL)

IngallsHealthSystem(HarveyIL)
VitalStatistics
FACILITIES
FACILITIES:
Number of Hospitals in the Health System
Number of Total Entities in Health System
Total number of licensed beds (hospital only)
Annual Admissions
Annual Outpatient Visits
Annual Emergency Department Visits

1
6
563
19,308
265,000
39,100

FINANCIAL RESULTS:
Net Revenues
Operating Margin Percentage
Days Cash on Hand

$ 214,059,000
, ,
1.32%
242

PAYER MIX PERCENTAGE:

M di
Medicare
Medicaid
Managed Care
Other
Total
ota

57.1%
57
1%
13.4%
26.9%
2.6%
100.0%
00.0%

65

IngallsHealthSystem(IHS)
g
y
( )
Background
y VincePryor,CFO
y BetterreportingandmonitoringhashelpedIngallsto

maintainitsfinancialviabilityandcontinuetoprovideits
communitywithhighqualityhealthcare,despitea
challengingpayermix

y CFOatIngallsforthreeyears
y PreviouslyservedasVicePresidentofFinanceatalargenotfor
y
g

profithealthsystem

y IngallswasaSolucient100TopHospitalMostImproved

in2004
4
y ItwasabletoenhanceSolucientsfivefinancialandfourclinical

indicatorsatarategreaterthanitspeers

66

IHS Daily
ExecutiveReport
Daily Exectutive Report
Report date: 05/10/05
Activity from: 05/09/05
Today
Actual

MTD
Budget

Actual

Budget

Description
Average Daily Census
Inpt
Nursery
Observations (Midnight census)

297
9
8

287
11

278
2,506
97

287
2,581
96

Inpatient Revenue
Outpatient Revenue
Total Revenue

$
$787,257
$272,349
$1,059,606

$1,062,530
$
$610,873
$1,673,403

$
$8,629,192
$4,763,894
$13,393,086

$
$9,562,769
$5,497,861
$15,060,630

Payments Posted to A/R

Vouchers Posted to A/R
Total Posting

$46,029
$358,576
$404,605

Yesterday's
Yesterda
's Admissions
Yesterday's NewBorns
Yesterday's Discharges
NewBorn Discharges
Yesterday's One Day Surgery
Harvey ED - not admitted
Cal City ED - not admitted
Tinley ED - not admitted
Outpatient Registrations
Uncoded Records:
Inpatients
Outpatients
Total
Case Mix Index
Previous Month (closing)
Year-to-Date
Year
to Date

Total AR

62
2
35
0
20
102
60
38
702
$3,485,317
$6,239,174
$9,724,491

1.313
1.3308

$2,636,813
$2,419,325
$5,056,138
56
4

461
35
432
37
153
756
437
350
4 531
4,531

501
36

The
Th Daily
D il Executive
E
ti
Report is sent to all
Administrators and
Managers. It is used
primarily by the
executives to get a feel
for performance. It is
meant to be a validation
of total volumes and
activity There is no
activity.
detail provided at the
department level.
Department managers
do receive detailed daily
activity reports in order
to validate charge
entries.
There is no daily
productivity reporting
taking place.

$66,410,670

67

IHS Biweekly
IHS
LaborManagementReport byDivision
The Biweekly Labor
Management Report is an
integral part of each managers
performance. Ingalls
considers that the information
on this report a direct
relationship between revenue
and labor performance.
The indicators are compared
on a flexible budget basis.
The managers are expected to
perform to the budget by the
next pay period.
If the variances are out of
compliance with the flex
budget,
g , the managers
g must
meet with the CFO and COO
each pay period.
As a resultno manager has
ever had to meet more than
three pay periods in a row!
This
hi is
i also
l a paper
representation of an online
labor management application
that allows the managers to
drill down to the person level.68

DrillDowntothe
Productive/NonProductiveEarningsCodes

INSIGHTS Budgeting, Monitoring and Reporting System

Source: www.hcillc.com

69

LaborDrillDowntoHoursandDollarsby
EarningsCodeandJobTitle

INSIGHTS Budgeting, Monitoring and Reporting System

Source: www.hcillc.com

70

IHS Monthly
IHS
UnitSummaryReport

This report allows the directors and the administrators to determine how well the department
managers are performing based on the services rendered (units of service). It is used to evaluate
overall labor outcomes.

71

IHS Monthly(Page1)
Monthly (Page 1)
IHS
DepartmentalRevenueandExpense

72

IHS Monthly(Page2)
Monthly (Page 2)
IHS
DepartmentalRevenueandExpense

This two page monthly departmental profit and loss has a very important element for the managers and
administrators. According to the CFO, placing the flex budget on the same page as the fixed budget allows the
managers to get a clear picture of their performance from a volume and expense standpoint.
Additionally, managers at Ingalls have the opportunity to look at any variances online and be able to
73
immediately drill down into the details.

Income Statement Drill Downs to Accounts

IncomeStatementDrillDownstoAccounts
PayableandJournalEntries

74

IHSMonthly
AdministrativeandBoardReport
TableofContents
Ingalls Memorial Hospital
Table of Contents

Executive Summary - Month of September

Page
1 & 1a

Executive Summary - Year-to-Date

2 & 2a

Admissions

Average Daily Census

Average Length of Stay

Medicare Case Mix Index

Cost per Adjusted Admission

FTE/AOB

Operating Margin

P ti t Accounts
Patient
A
t Receivable
R
i bl Days
D
Outstanding
O t t di

10

Financial Statements
- Balance Sheet
- Statement of Income
- Cash Flow Statement

11
12
13

S
Summary
off P
Patient
ti t Service
S i Statistics
St ti ti

14

Patient Key Metrics Comparisons - Month of September

15

Patient Key Metrics Comparisons - Year-to-Date

16

It is clear from this Table of

Contents that Ingalls
Monthly Administrative and
Board Finance Committee
Report is only 16 pages and
-The first ten pages are
devoted to the reporting of
key indicators
-- The Balance Sheet and
Income Statement are
included, but not until page
11

75

IHS YearToDateExecutiveSummary
Year To Date Executive Summary
IHS
ReviewofFinancialPerformance
Ingalls Memorial Hospital
Review of Financial Performance
For the Period Ended September 30, 2004
Executive Summary
Financial Highlights:
Actual
Income (loss) from Operations
Excess of Revenue and Gains

Budget

$2,879,846
$6,166,530

$2,501,888
$4,124,269

17,196
970
1,142

17,434
1,072
1,165

Observation Patients

1,168

1,181

Length of Stay
Acute
Rehab
Psych

4.59
14.06
7.14

4.45
11.65
6.84

Admissions
Acute
Rehab
Psych

Medicare PPS Length of Stay

Hospital Outpatient Registrations
FTE's
FTE's per Adjusted Patient Day
FTE's per Adjusted Admission
Net Days in A/R
DNFB
Medicare CMI
T t l CMI
Total
Cost/Adj. Patient Day (CMI Adj.)
Cost/Adj. Admission (CMI Adj.)
Deduction from Revenue %
Bad Debt as % of Gross Revenue
Operating Margin %

5 94
5.94
264,905
1,865
4.33
22.59
56.89
7.30
1.3341
1 1071
1.1071
1,235
6,432
61.39%
3.34%
1.319%

5 68
5.68
251,290
1,849
4.37
21.77
53.51
6.00
1.3314
1 1000
1.1000
1,251
6,240
59.87%
3.71%
1.162%

Variance
$377,958
$2,042,261

%Variance

FY03

15.1%
49.5%

$4,108,011
$4,837,680

(238)
(102)
(23)

(1.37%)
(9.51%)
(1.97%)

17,159
1,009
1,209

(13)

(1.10%)

1,122

3.03%
20.75%
4.30%

4.54
12.89
6.58

0.13
2.42
0.29
0 26
0.26
13,615
15.75
(0.03)
0.82
3.38
1.30
0.0027
0 0071
0.0071
(16)
192
1.52%
(0.37%)
0.16%

4.58%
4
58%
5.42%
0.85%
(0.76%)
3.77%
6.32%
21.67%
0.20%
0 65%
0.65%
(1.26%)
3.07%
2.54%
(9.95%)
13.49%

5 65
5.65
247,218
1,862
4.46
22.74
56.78
9
1.3512
1 1083
1.1083
1,229
6,259
57.95%
3.82%
1.94%

This report format,

of a number of key
financial metrics,
metrics is
presented at the
beginning of the
monthly financial
reporting package,
developed
p for
f
administration and
the Board Finance
Committee.
This primarily is
a volume report,
with some extra key
financial indicators
included, for review
by the Leadership.

76

IHS MonthlyTrendGraph
Monthly Trend Graph
IHS
CostPerAdjustedAdmission(CMIadjusted)
Ingalls Memorial Hospital
Cost per Adjusted Admission
9,000
8,500
8,000
7,500
7,000
6,500
6,000

OCT

NOV

DEC

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

Actual

6,773

7,719

6,946

7,426

7,402

6,663

6,974

7,113

6,956

7,123

7,228

7,238

Budget

6,784

7,040

7,012

6,730

7,080

6,682

6,985

6,891

6,879

6,777

6,729

6,823

Prior Year

6,392

6,785

6,735

6,771

7,049

6,523

6,607

6,612

7,081

6,793

7,177

8,844

Because both Medicare and Medicaid are case based and make up 70% of the Ingalls
revenue, the IHS administration and its Board Finance Committee uses the information
from this key indicator, as reporting in this trended fashion, to determine how well they
are managing their costs.

77

IHS Monthly
PatientKeyMetricsComparison
Ingalls Memorial Hospital
Key Metrics Comparisons
For the Month Ended September 30, 2004
Actual
Cash Flow
Days Cash on Hand
Average Payment Period
Net A/R Days

Budget

Fav/(Unfav)

% Variance

241.5
44.9
56.9

266.3
64.7
53.5

(24.7)
(19.8)
(3.4)

(9.29% )
(30.63% )
(6.32% )

Net Revenue
Net to Total Gross Patient Revenue
Net Revenue per Adjusted Patient Day
Net Revenue per Adjusted Admission
Medicare Case Mix
Total Facility Case Mix

38.81%
1,366
7,269
1.3116
1.1323

41.56%
1,363
6,740
1.3314
1.1000

(2.75% )
3
529
(0.0198)
0.0323

(6.62% )
0.21%
7.85%
(1.49% )
2.94%

Salaries/Wages/Benefits
SWB as Percentage of Net Revenue
SWB per Adjusted Patient Day
SWB per Adjusted Admission
Benefits as a Percentage of Salaries
FTE's per Adjusted Patient Day
FTE's per Adjusted Admission

49.32%
674
3,585
15.33%
4.27
22.40

49.87%
680
3,361
20.06%
4.38
21.68

0.55%
6
(224)
4.73%
0.12
(0.72)

1.10%
0.88%
(6.66% )
23.58%
2.70%
(3.34% )

Expenses Indicators
Supplies as a Percentage of Net Revenue
Supplies per Adjusted Patient Day
Supplies per Adjusted Admission
Bad Expense as a Percentage of Gross Revenue
Cost Per Adjusted Patient Day CMI Adjusted
Cost Per Adjusted Admission CMI Adjusted

17.74%
242
1,289
3.29%
1,201
6,392

13.41%
183
904
3.66%
1,254
6,202

(4.32% )
(59)
(385)
0.38%
53
(190)

(32.22% )
(32.51% )
(42.60% )
10.31%
4.24%
(3.06% )

5.91
5
91
5.25
1.15%
11.6

5.68
5
68
4.94
0.39%
10.9

(0.23)
(0
23)
(0.31)
0.75%
(0.7)

(4 05% )
(4.05%
(6.21% )
192.28%
(6.53% )

Global Indicators
Medicare LOS
Hospital Length of Stay
Operating Margin as a Percentage
Average Age of Plant

Moody's = "A" rated organizations

Moody's
Moody
s

151.9
58.7
58.1

1.46

4.7
2.0%
9.0

Unlike the more volume

related reports at the
beginning of the monthly
administrative and Board
Finance Committee
package,
k
thi reportt is
this
i
clearly titled as a key
metrics comparison and
is used to determine the
variances between the
goals and the actual
outcomes.
The CFO will prepare
additional information
based upon the outcome
of these Performance
Drivers.
According to Vince
Pryor, Ingalls CFO,
Color coding the
variances have proven to
be extremely helpful to
the Board Members in
understanding the
outcomes.

78

IHS MonthlyPerformanceMeasureReport
FINANCIAL

QUALITY

SERVICE

1. LOS
OS Medicare

7. Med Error Rate

2. Case Mix Index

8. Adverse Drug
Reactions

13. Total
Patient
Satisfaction

22. Outpatient Visits

14. ED Bypass
Hours

9. Central Line
Bacteremia

23. Total Surgical Cases

18. FTEs/Adj.
Occupied Bed

15. Left Without

Treatment

10. Ventilator
Pneumonia

5 Net Days in A/R

5.

21 IInpatient
21.
ti t Admissions
Ad i i

16. % Staff Overtime

Hours
17. Staff Turnover Rate

3. Operating Income
4. Bad Debt Expense

GROWTH

PEOPLE

24. Ingalls Market Share

19. RN Agency Use
25 Cardio Market Share
25.
20.RN Vacancy Rate

6. Days Cash on Hand

11. Postop Infection

(SSI)

26. OB Deliveries Market

Share

12. Mortality Rate

27. Onco Market Share

At or better than Goal

28. Ortho/Neuro Market

Share

Worse than Goal

Sample Performance Measures Data

OPERATING INCOME (LOSS)

$600,000
$500,000
$400,000
$300,000
$200,000
$100 000
$100,000
$0

Goal: Current Budget

Operating Income

Budget

2.58

3
2
1
0

D
A
Ja F
Ju Ju A
M
S
M
v- ec- n-0 eb- ar- pr-0 ay- n-0 l-0 ug- ep03 03
04 04
4
04
4
4
4 04 04

ED BYPASS HOURS

Goal: 0

ED Bypass Hrs

4th Qtr '03

1st Qtr '04

46

ov
N

ec
D

23

18

19

Inpatient Admissions

84.7

84.62

42

26

82.88

21

03

03

INPATIENT ADMISSIONS

3rd Qtr '04

Goal: 82.7%

LWOT

04
pSe
04
gAu
4
l-0
Ju
04
nJu
4
-0
ay
M
4
r-0
Ap
4
-0
ar
M
04
bFe
04
nJa

33

2nd Qtr '04

TOTAL PATIENT SATISFACTION

83.18
0

2.58

2.16
1.52

No

350
300
250
200
1 0
150
100
50
0

Goal: 2.45%

ADVERSE DRUG REACTIONS

Goal: Current Budget

4th Qtr '03

1st Qtr '04

2nd Qtr '04

Budget

Total Surgical Cases

650

1,600

600

1,500

550

1,400

500

681

638

615
578

570

572

608

577

04

04

04

4
l -0
Ju
04

ay

r-0

nJu

Ap

03

4
-0
ar
M
04
bFe
04

nJa

04
pSe
04
gAu
4
l-0
Ju
04
nJu
4
-0
ay
M
4
r-0
Ap
4
-0
ar
M
04
bFe
04
nJa
03

ec
D

ov
N

596

pSe

1,700

Budget

gAu

700

3rd Qtr '04

Goal: Current Budget

TOTAL SURGICAL CASES

1,800
,

85.0
84.5
84.0
83 5
83.5
83.0
82.5
82.0
81.5

This report has been

primarily created for the
full Board of Directors. It
is designed to report the
key indicators, financial
and
d non-financial
fi
i l rather
th
than the raw numbers,
which have less meaning.
Green indicates favorable
outcomes ffor the time
period; Red indicates
unfavorable outcomes.
The CFO then chooses
to provide additional
information to the Board
depending on the
outcomes.

79

IHS Monthly
Monthly
IHS
PartialPerformanceMeasureSummary
Sep-04
p

Aug-04
g

Jul-04

Jun-04

May-04
y

Apr-04
p

Mar-04

*GOAL
3rd Qtr '04

2nd Qtr '04

1s

Financial
Length of Stay (Medicare)

5.68

5.91

5.88

5.96

5.70

5.50

5.77

6.18

Case Mix Index

1.33

1.31

1.30

1.4

1.29

1.34

1.32

1.36

Operating Income (Loss)

163,173

158,702

221,390

Bad Debt Expense

1,525,468
53.51

Net Days in A/R

Days Cash on Hand

266.3

541,002

110,430

116,652

1,552,003

1,514,875

1,522,505

56.89

56.48

60.00

55.27

241.5

266.2

273.7

280.3

263,726

257,780

1,700,781

1,393,544

60.05

59.65

59.28

269.7

266.3

270.8

0.85

1.11

1,244,481 1,056,836

Quality
3.25

2.82

3.07

2 45
Adverse Drug Reactions/1000 pt days 2.45

2 58
2.58

2 58
2.58

Medication Errors/1000 pt days

Nosocomial Infection Rates

-Central Line Bacteremia

6.8

1.2

1.0

-Ventilator Pneumonia

11.2

12.6

13.0

-Postop Infection (SSI)

5.5

3.3

Mortality Rate

< 2.1%

1.03

0.85

3.2
1.3

1.04

0.96

Service
84.62

Total Patient Satisfaction

82.7%

ED Bypass Hours

21.2

25.5

42.03

19.1

2.5

18.49

Left Without Treatment

151

238

183

184

173

154

139

198

84.7

The six financial metrics

have been identified by
Ingalls as its key
indicators and reported
to the full Board.
Board
They are reported on a
monthly basis and
trended across time for
better understanding and
analysis by the Board
members.
The goals are clearly
identified in the first
column and are expected
to be met by the
administrators and the
managers.

* Based on industry standards, annual performance goals or internal historical trend or average.
JCAHO St
Staffing
ffi Effectiveness
Eff ti
Indicator
I di t
New for 2004

80

IHSInstant Reporting
Al B d E
i
AlertBasedExceptions

An alert will be sent to those

people responsible.
This alerts based management
g
exception
p
report
p is utilized at all times byy Ingalls
g
management
g
and administration to
instantly know which departments are out of compliance with their goals generally based on those key
performance indicators that administration has deemend most important to the success of the operations.
Source: Healthcare Insights INSIGHTS decision support management accountability software system. www.hcillc.com

81

What Do the Reports of

WhatDotheReportsof
AllThreeHospitalsHaveInCommon?
y Allthreeofthebestpracticehospitalshavedeveloped

similarreportsthatallowthemtotakeACTIONS
y Dailyreportsthatuseratiostotrackandtrendactualactivities

againstbudget,priorperiodsand,insomecases,benchmarks
y Biweeklyproductivityanalysis,whichusedifferentlookstryingto
gettothesameresult achievingbudgetarygoals
gettothesameresult
y MonthlyexecutiveandadministrativereportsthatutilizeKPIstoa
greatdegree,ensuringthattheorganizationstaysontracktomeet
itsgoals
y Theuseofgraphsandtrendgraphstohighlighttheresultsofthe
indicators

82

PollQuestions
4.Doyousetyourhospitalmetricsgoalsatthemedian
(50th percentile)orhigher?
y 50th percentile
y Higher

55.HasthehospitaldevelopedasetofBalanced
p
p
Scorecardmetricsthatarereportedonaregularbasis?
y Yes
y No
N

83

C l i
Conclusion
y Keyperformanceindicators(KPIs)representkeydriver

andcriticalsuccessfactorstotheorganization
y TheKPIsaredevelopedinordertomeasuretheresults
oforganizationalpolicies practicesandprocedures
oforganizationalpolicies,practicesandprocedures
y Performanceindicatorscanprovidesignificantvalueto
anyorganizationthatutilizesthem,particularlyto
y Setthegoals
y Presenttheresultsinanclearmannertoenhancedecision

making

y Healthcareorganizationsneedstoensurethattheyuse
lh

d
h h

KPIstomaximizetheiroutcomesintothefuture

84