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Right on Schedule

Hospitals take care of people. Doing it well requires the right mix of nurses and clinical specialists for the ever-changing mix of patients in a hospital at any given hour, day or week.

Keeping up with those changes is hard, especially when a hospital uses paper and pencil or spreadsheets to do it. In fact, hospital administrators are the first to admit their track record of matching personnel to schedules is pretty bad.

Now some hospitals and health care organizations are revamping how they create schedules by using shift-scheduling software.

The incentives to do better are huge. According to a recent PricewaterhouseCoopers study, the ongoing nursing shortage is expected to reach 400,000 to 1 million registered nurses by 2020. That means RNs who don’t get the schedules they want can quit and easily get another job, or sign up with an outside registry where they’ll have more say over their hours.

Hospitals that do a poor job of scheduling have higher labor costs because they end up filling holes with registry nurses who get paid higher hourly wages. That can hurt a facility’s bottom line and morale of staff RNs who know outsiders make more than they do, according to hospital administrators and industry analysts.

In a landmark 2004 study, the University of Pennsylvania showed that patient-care error rates are three times higher for nurses who work more than 12 hours straight than for RNs who work shorter shifts, a situation that can occur because of poor scheduling.

More hospitals are counting on shift-scheduling software to fix that.

The software lets an employee log on to a Web-based, interactive, calendar-style grid to select the hours and days they want to work. The latest versions also allow employees to swap shifts with co-workers or include reserve auctions, where workers bid against one another for an open shift. Administrators use the software to create scheduling rules based on patient care or hospital policies, and then monitor and analyze schedules for individual departments or entire organizations.

A handful of vendors sell shift-scheduling software, from boutique developers to large HR technology players such as Kronos, Infor and Lawson Software, which entered the market by acquiring VasTech, a shift-scheduling software specialist, for an undisclosed amount in March.

Some of the first hospitals to use shift-scheduling software include well-known institutions such as Johns Hopkins Hospital, the Cleveland Clinic, Memorial Sloan-Kettering, Banner Health and BJC Health System. One of the latest is Kaiser Permanente, which plans to roll it out to 30,000 doctors and nurses in its Northern California system, according to VasTech officials who sold Kaiser the system. Kaiser officials did not return phone calls for comment.

Institutions that use shift-scheduling software have cut payroll expenses, error rates and turnover, according to hospital administrators, vendors and HR software industry analysts.

The software has been so successful some institutions are using it when they recruit nurses, listing it along with other benefits in ads and marketing brochures.

“Health-care providers are taking this very seriously,” says Albert Pang, a human capital management software analyst with IDC, the technology researcher. “They’re using it to reduce labor costs and insure employees have more control over their lifestyle, which is important when you’re trying to retain a highly” desirable workforce.

Hospitals administrators point out, however, that overhauling scheduling isn’t just about buying software and it isn’t a quick fix. While some employees have embraced the new methods, others have to be coaxed, says Maureen Furno, with Wheaton Franciscan Healthcare in Milwaukee, which started using the software two years ago. “We still have stragglers,” Furno says. “Rolling out the software was the easiest part. The hard part is changing your culture.”

The cure for subpar scheduling
At Wheaton Franciscan, administrators knew their scheduling efforts were subpar, says Furno, a nurse and the facility’s administrative director of staffing and scheduling.

Wheaton Franciscan runs five hospitals, three continuing-care facilities, a home-health division and a medical group. That’s 466 separate departments and 8,500 employees. Before, most departments did their own scheduling in their own way and didn’t communicate about schedules with one another, Furno says.

The results weren’t pretty. One example: Nurses who worked as floaters between sites normally got only 80 percent of the hours they wanted because schedulers couldn’t track all the open shifts, Furno says. Some employees didn’t know if they would be working the next day, she says.

Wheaton Franciscan embarked on what turned out to be a three-year campaign to fix things. An interdisciplinary team that included nursing, HR and IT personnel spent a year surveying departments about what they were using. Then they created a needs assessment, had a wish list approved by administrators and put out a request for proposals.

Ultimately the institution spent several hundred thousands of dollars on software from Kronos, the workforce management software maker. Implementing it out took two years, through February 2008. The organization started in the four hardest-to-schedule departments: ER, OR, ICU and the lab, “because they work 24 hours a day, their volumes go up and down significantly, they’re on call and it’s not just nurses,” Furno says.

She’s been more than satisfied with the results. Today, cross-site floaters work 95 percent to 98 percent of the hours they want. Instead of nurses picking up extra shifts through outside registries, “We can make sure they get what they want with us, and we have more satisfied employees,” Furno says.

Children’s Hospital in Omaha, Nebraska, started using shift-scheduling software for approximately 450 inpatient nurses in March 2007. It has proved so popular that some of the hospital’s doctors are clambering to use it, says Allana Cummings, the institution’s chief information officer.

During the remainder of 2008, the hospital will introduce the software to nurses in other departments and to other staff. “It’s become a competition to see who’ll be able to go live next,” Cummings says. As for the physicians, a group of staff doctors who advise administrators on IT issues has requested a demo. “They’re intrigued,” she says.

Although Cummings wouldn’t say how much the software cost, the hospital is on track to recoup its investment in two years or less. But the effect has gone beyond ROI. Automation has cut a significant amount of time out of the scheduling process and enhanced overall employee satisfaction, she says. “We’ve used our investment in tools for our staff as a means of showing our commitment to our nursing team,” she says.

The future of scheduling
According to analysts, shift-scheduling software typically costs $100 to $300 per employee, with volume discounts going to large purchasers. To reach the widest possible customer base, vendors sell, lease or host the software or work with hospitals that choose to have a third-party data center host it for them.

As more institutions buy the software, the boutique developers offering it have become takeover targets for larger workforce management software makers who want to fill a gap in their product lines.

That’s what led Lawson Software, the St. Paul, Minnesota, company that aspires to be a top HR software player, to acquire VasTech, of Annapolis, Maryland. Forty percent of Lawson’s customers are in the health care industry, and in discussions with those customers, the subject of shift-scheduling software came up over and over again, says Jennifer Langer, a product management director for Lawson.

The same reasoning led Infor, a major ERP software maker, to acquire Workbrain, a Kronos rival, in April 2007 in a stock deal worth $196 million, and Red Prairie to acquire BlueCube, a workforce scheduling software maker, in 2006.

Scheduling has to be integrated into a lot of other applications, so it follows that makers of workforce management suites would want it, says Christa Degnan Manning, research director at AMR Research.

On the flip side, it behooves hospitals to invest in workforce management software, Manning says. “Labor is their biggest expenditure and the battle for talent is unbelievable,” she says. While hospitals can’t offer astronomical salaries, they can offer flexible schedules as a way to attract and retain nurses at a time when they’re in such short supply, she says.