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Functional value analysis: a technique for reducing hospital overhead costs

J E Bennett, J Krasny

    Topics in Health Care Financing
    |January 1, 1977
    PubMed
    Summary
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    Functional Value Analysis (FVA) offers benefits beyond hospital overhead. Administrators believe FVA

    Area of Science:

    • Healthcare Administration
    • Operations Management
    • Health Services Research

    Background:

    • Functional Value Analysis (FVA) is a methodology often applied to hospital overhead functions.
    • There is a growing interest among hospital administrators in expanding FVA applications.
    • Existing literature primarily focuses on FVA in administrative or non-clinical settings.

    Purpose of the Study:

    • To explore the potential application of Functional Value Analysis (FVA) methodology to non-overhead hospital functions.
    • To assess administrator perceptions regarding the benefits of extending FVA to clinical and support departments.
    • To identify specific hospital areas where FVA could yield significant improvements.

    Main Methods:

    • Qualitative assessment of administrator perspectives and experiences.

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  • Review of anecdotal evidence from FVA application in non-traditional hospital settings.
  • Conceptual exploration of FVA's applicability to departments like radiology, laboratory, and nursing.

    • Main Results:

    • Administrators perceive that FVA's structured approach can enhance efficiency in various hospital departments.
    • Experience suggests FVA can be successfully adapted to non-overhead activities.
    • Anticipated benefits include improved resource utilization and process optimization in clinical areas.

    Conclusions:

    • Functional Value Analysis (FVA) holds significant potential for optimizing operations in diverse hospital settings, including clinical departments.
    • The methodology's systematic nature and emphasis on personnel involvement are key factors for successful implementation.
    • Further research and pilot studies are warranted to validate FVA's impact on non-overhead hospital functions.