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The balancing act: patient care time versus cost
Judith Lloyd Storfjell1, Osei Omoike, Susan Ohlson
1Department of Public Health, Mental Health, and Administrative Nursing, University of Illinois at Chicago, College of Nursing, Chicago, IL, USA. jstorfjl@uic.edu
The Journal of Nursing Administration
|May 13, 2008
Summary
Over one-third of nurses' time is non-value-added (NVA), costing hospitals significantly. Reducing NVA and support activities can improve patient care and decrease costs.
Area of Science:
- Healthcare Management
- Nursing Economics
- Clinical Operations
Background:
- Rising healthcare costs and demands for improved patient outcomes necessitate efficient resource allocation in hospitals.
- Nursing wages represent a substantial portion of hospital budgets, making the analysis of nursing activities' costs crucial for financial management.
Purpose of the Study:
- To analyze nursing activities and associated costs using an activity-based costing approach in medical-surgical units.
- To identify non-value-added (NVA) time within nursing activities and quantify its financial impact.
Main Methods:
- An activity-based costing method was applied across 14 medical-surgical nursing units.
- Data on time spent on patient care (assess, teach, treat, psychosocial support) and support activities (care coordination, record management) were collected through focus groups, interviews, and timed observations.
- Annualized wage costs were calculated for each activity, including NVA time, to determine cost implications.
Main Results:
- More than one-third of nurses' time was classified as NVA, amounting to an average of $757,000 per nursing unit annually in wage costs.
- Nurses dedicated 56% of their time to support activities versus 44% to direct patient care.
- Patient teaching and psychosocial support received the least amount of nursing time.
Conclusions:
- Significant opportunities exist to enhance clinical outcomes and reduce hospital costs by optimizing nursing workflows.
- Implementing process improvements to minimize NVA and support activities, while increasing direct patient care time (especially teaching and psychosocial support), is recommended.
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