In this episode, Dr Jamie Coleman is joined by Clayton Brinster, MD, FACS, from Ochsner Health. They discuss his study, which demonstrates a significant increase in surgical nursing labor cost, with a resultant decrease in department of surgery financial margins. This nationwide, precarious trend is not sustainable, and fiscal recovery will require sustained, strategic workforce allocation.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:01):
Welcome to the Operative Word,
a podcast brought to you by the
Journal of the American College of
Surgeons.
I'm Dr. Jamie Coleman.
And throughout this series, Dr.
Dante Yeh and I will speak with
recently published authors about the
motivation behind their latest
research and the clinical
implications it has for the
practicing surgeon.
(00:22):
The opinions expressed in this
podcast are those of the
participants and not necessarily
that of the American College of
Surgeons.
Welcome to the Operative Word, a
podcast from the Journal of the
American College of Surgeons.
I'm Dr. Jamie Coleman, one of your
hosts for this series.
In this episode, I am joined by Dr.
Clayton Brinster, and we'll be
(00:43):
taking an in-depth look into his
current article "Severe
Increase in Nursing Labor Cost
and Effect on Surgical Department
Financial Margins at an Academic,
Tertiary Medical Center."
Dr. Brinster is a senior staff
surgeon in vascular surgery
and the director of the Ochsner
Aortic Center at Ochsner Health
in New Orleans.
(01:04):
Dr. Brinster, welcome to The
Operative Word.
Thank you very much.
And like we were previously
discussing, it's really an honor to
be invited. And I hope to provide
some insight into a very challenging
topic.
Oh, definitely.
I can't wait to dive in on
this, actually. But before we do
that, do you have any conflicts of
interest you'd like to disclose?
No, I have no relevant financial
(01:25):
conflicts of interest.
Perfect.
Well, congratulations to you on both
the presentation at the Southern
Surgical Association and this
publication, and even
just more kudos for tackling
a topic that really has impacted
every single surgeon, regardless
of your specialty, regardless of
your practice setting.
(01:45):
Because, listeners,
today we are talking nursing
shortages, something I think
all of us have felt and really
an issue that's been felt at every
level within our healthcare system,
from our patients to our nurses
to the physicians and definitely
to the administrators.
To provide a statistic from
(02:06):
your paper, national
healthcare employment has dropped by
over 550,000
people with nursing and
residential care facilities
comprising about 4/5 of that
loss.
That is just an incredible
and sad statistic.
So I'm really looking forward to
getting into this.
(02:26):
And so for our members who
or listeners who may not have had a
moment to read your paper yet,
let's just kind of step back and
talk about the framework and
methodology of your study.
So you looked at nursing costs
and its impact on your financial
margins within the surgery
department and you compared two
periods of time (02:46):
pre-COVID,
which was January 2019
to February 2020,
and then COVID, which was March
2020 to December 2021.
So let's kind of break those two
chunks of data down.
Let's start out with the nursing
costs.
Can you tell us a little bit you
have very detailed methodology.
(03:06):
Can you please share with us a bit
on that?
Well, sure.
I think initially, just for
a little bit of background about how
we came to investigate this topic
in the manner we did.
Ochsner Health is in New Orleans,
Louisiana.
And if we can remember back,
which seems like many years ago,
(03:26):
at the very beginning of the
pandemic, New Orleans was
disproportionately affected by the
first wave of of COVID
infections.
It was one of the three cities,
primarily, I think, with New York
and Seattle, that really were the
first major cities
to be inundated with COVID
infections and have ICUs
and ERs overrun.
(03:47):
And so early in the pandemic,
as we all remember, our elective
surgeries were severely restricted
by by the American College
and by other governing bodies.
And so when those restrictions
were lifted initially three months
after the pandemic
was declared by the US government,
we became interested in the
financial losses for our vascular
(04:09):
surgery division only.
And when we looked at that, we saw a
severe dip.
Of course, during the period
when there was elective
restrictions, but a return
to normal, in fact, sometimes
higher volume in the months
directly after those restrictions
were lifted. And so when we first
put some data out examining
just pure financial revenues,
(04:29):
margins and
deficits caused by the lack of
elective surgery in those first
three months, what we saw was that
we had evened out pretty much about
six months after the pandemic
started, and we
did a brief calculation based on
some other studies we saw in some of
some of our own metrics to calculate
how much of a RVU
(04:51):
overage per month it would take to
recoup that data.
And in short, it would take a very
long time.
Severe
RVU overages of five and 10%.
Both were years long processes to
recoup what we lost in just three
months. But when we
we looked at extending that
data for
the manuscript, which
(05:13):
by my own fault, took a little bit
of time to get going.
What we what we saw was that our
RVU generation was consistent.
However, after a brief
return to normal values
of margins with
consistent RVU generation up to
a year or two after that
initial or I guess a year to
18 months after that initial
(05:34):
deluge of COVID and restrictions,
we saw that there was a gradual
erosion of overall
surgical margin, financial
margin within the vascular surgery
division
here at Ochsner
starting really in the beginning of
of 2021.
So it was a little bit of a puzzling
(05:55):
result because every month we had
met our pre-pandemic
metric for RVUs or in many cases
there were overages each month
and still our financial margin was
deteriorating. And so
with with Thomas
Escousse, who is an MBA,
worked here at Ocshner, carefully
analyzing and tracking
(06:15):
financial metrics within the surgery
departments, he and
I looked very closely at what was
happening. And we we
saw a very obvious
increase in labor expenses,
particularly nursing labor expenses,
which arose not only from
nurses requiring more pay because
more and more nurses were infected
(06:36):
with COVID and taking mandatory
leaves and quarantines.
But because there was such a
rearrangement of the actual
labor force that agency nurses
were being employed in a way that
we'd never experienced before.
And the average labor
expenditure for the hospital and
nursing rose astronomically, as
we saw and I quoted in the paper.
(06:57):
And so when we looked into the
proper methodology to get back to
your original question about how to
properly how to properly analyze
this, basically we tracked
nursing expenses, and nursing
expenses were tracked on a daily
basis at our institution
by a combination
of artificial
intelligence and also a daily
(07:18):
record, a daily monitor that was
kept on a per unit basis.
And so we could see, based
on the way Ochsner tracks data
which nurses are in
which respective units
and how many of those nurses were
Ochsner employed nurses and how many
were agency nurses.
And so we had not only the total
(07:38):
cost of nursing, we had the number
of nurses per shift per unit
and the number of agency nurses per,
per unit per shift, and that
was that was tracked in an ongoing
daily basis. And so
it was the careful organization
and analysis of that data that
allowed us to look back and
look at real numbers.
And I should mention that
(08:00):
a key distinction to a lot of
financial studies which take place,
we did have access to the actual
contractual numbers that
were paid not.
Just estimates, both
for the
cost and also for
RVU.
Most of our patients, as many
medical centers, are
Medicare patients, and
(08:22):
so many institutions
rely on administrative
projections or Medicare estimates
for that denominator.
However, we have access to the real
numbers at Ochsner, which is a
benefit.
So we can predict and analyze what
is actually happening.
And that's and that's a huge
variable for so many centers.
And I think it was just
(08:43):
it helps really
put these findings into context
when you realize these are real
numbers, these aren't,
like you said, this isn't just a
projection or an estimate.
And so tell us a little bit
then about how you calculated
your financial margins.
Well, the margins the margins are
tracked in the same way.
(09:03):
So we have access to the real
accounting and billing numbers, like
I mentioned. And you just
acknowledged that it was really
startling to us when we saw the
actual revenue.
We analyzed net revenue
right up right on a on a monthly
basis. And that has to do with RVU
generation and
and costs as well.
(09:24):
The majority of that
was labor costs that was increasing
here. Of course, there are other
costs such as equipment,
transport, all sorts of other
silos. But when you look at the data
from our paper, the major increase
in the bulk of the of the costs
that we were fighting that were
eroding the financial margins was an
increase in surgical nursing labor
per month.
(09:45):
To standardize that, just as you
mentioned there, although Medicare
is an umbrella organization, of
course there is a major variability
in costs and
margins in different regions.
And so to reduce
the subjectivity of it, I'm sure
we'll come back to this topic.
We we compared
(10:06):
these numbers and standardized them
on an RVU basis
because the RVU is not something
that that varies
from region to region, from call
center to health center.
And so when we
that that was really, I think, the
most powerful data or some
of the most powerful data that we
shared because the RVU is a
universal standard around the
(10:27):
country.
Agree this really took it
and broke down the problem
in a way that with your dollar
or your cost per RVU,
which we're going to talk about a
second because I want you to
summarize your finding for us.
But it really contextualized it and
it made it something that anyone
picking up this paper can read
and it translates to their
(10:48):
center.
So I thought that I agree.
I thought the way that you all
really broke this down and presented
it just made
this such an important and
translatable translatable
paper.
So yeah, let's let's go ahead and
dive into that. Let's, let's dive
into the findings.
So what did you find?
So you looked at how much nursing
was costing you.
(11:09):
You looked at how that impacted
your margins, your bottom line
in the surgery department.
How bad was it?
Well, it was pretty severe.
And as you can see from the paper, I
think that could direct people if
they have access to it or want to
write it down. Table 1 really
summarizes the the major
metrics that we looked at.
And when we looked, we
(11:29):
as you mentioned, we we compared a
14 month pre-COVID cohort
to a 21 month COVID cohort
which started at the beginning of
the pandemic.
And when we broke those numbers
down, we saw on a per month
basis surgical nursing labor
increased by 17%.
And so I think when you're inside
some medicine, you hear percentages,
you're not really sure what they
(11:50):
mean. But when we talked,
when I was learning about this topic
early in the pandemic, it
occurred to me that that is an
astronomical number, because when
you think of how many health
systems, most health systems
operate, most are
between a -3%
and a positive 3% operating
margin on in any given year.
And in fact, the average operating
(12:11):
margin for U.S.
hospitals and health centers before
the pandemic was about a positive
1.5%.
So when you have a major silo
of costs, that increases 17%.
That that's that's startling.
That really, I think, puts fear
into the administrators
and government officials as well.
(12:31):
And so combined with that
increase we saw when we compared
pre-COVID to COVID
periods, we saw that the
departmental that is Department of
of Surgery, not including
subspecialties such as
orthopaedics, neurosurgery and
others, but yes, including urology,
plastic surgery, vascular
cardiovascular or colorectal
acute care surgery.
(12:52):
When we looked at that, we saw that
the financial margin within the
department had decreased 11%.
When we compared those two cohorts,
again, both of those values were
significant based on statistical
analysis, and both are really
pretty startling numbers when you
compare those to the operating
margins we just discussed,
when we looked at at
(13:14):
the RVU generation of the entire
department, we found that while
there was a slight drop off
when we compared the two cohorts, it
was not statistically significant.
And so we knew
that there was a reason besides
a decreased RVU generation
per month, which was not significant
compared with with the strongly
significant values of increased
(13:35):
surgical nursing labor and
deteriorating departmental financial
margin per month.
As we were just talking about when
we looked at the nursing, surgical
nursing expense, per RVU,
which I have to give credit to Dr.
Sam Money, who really
that was really his idea
to look at that as a standard
(13:56):
benchmark to make
our data more translatable.
We saw a staggering increase
that was statistically significant
in nursing expense per RVU.
And this is in the face of
insignificant or not significant
changes, I should say, between the
two cohorts of traditional metrics
which can affect revenue.
And those include things we're all
(14:16):
familiar with, like length of stay
per case, case mix index,
which is determined by standard
metrics and the case volume per
month. And not none of those
three was statistically
significant. So what that
basically means in a nutshell is
that traditional metrics, RVU
generation, length of stay per
(14:36):
case, case mix severity
index and case volume per month did
not change significantly when
we looked at the two cohorts.
But what did change in a startling
fashion were the two metrics
we just discussed, surgical nursing
labor per month and the financial
labor per month.
With labor getting much more costly
and margin gradually being eroded.
(14:57):
And just to drop some numbers in
here from your paper, you had an
average monthly increase
of $330,000
in nursing expenses, which
represented an additional
$1,243
per case.
And in terms of this cost per RVU,
cost per RVU went
(15:17):
from $110 to
$148 in
the COVID era.
And again, you're like, Oh, okay,
$38, but $38
per RVU.
I mean, that's just an astronomical
cost. And you also
included system-wide
data on this as to what
drove it.
(15:38):
And one of the things that you
mentioned, that agency-related
nursing costs increased
from $5.1 to
$13.5 million
per month in
2021 compared
to even 2020.
So this problem
(15:59):
is it didn't just show
up and it went away.
It's still here.
And when you start thinking about
these numbers, you're talking about
17% for these
margins, this is clearly
unsustainable.
So what has happened in your
institution? What sort of solutions
have you
found or are you working out?
What sort of changes have been made
(16:20):
in your location to
help with this?
The numbers you mention there are
staggering, really. Like you
mentioned, nursing costs
5 million, about 5 million per month
during during the first year of the
pandemic. So that's that's an
increase from prior to the
initiation of the pandemic
costing costing an additional
over $100 million for the health
(16:41):
center in 2021
on agency nursing labor.
I mean, that's really a staggering
number.
Initiatives have been taken
throughout the pandemic to try to
limit that that increase.
However, with the emphasis on
patient care and being the largest
health system in the Gulf South, and
one of only two really big tertiary
care centers in this region, the
other being LSU's hospital.
(17:03):
Patient care was always first and
we were always taking COVID patients
from around the region and
taking the most acute tertiary cases
from all over the Gulf South, of
course. But now that the pandemic
has waned, and I should mention that
it when we looked at these
numbers, every number, every metric
was intensified and followed waves
of COVID in the region as we tracked
(17:25):
with public health data.
So there really can be no doubt that
there is a there's a direct
causal relationship here.
But when we when we think about
where Ochsner is going from here,
we've alluded to a little bit
before, we've used to
increase the sophistication
of labor deployment and redeployment
(17:45):
in the hospital, we
have utilized several different
types of artificial intelligence
and machine learning to predict
case positivity in the community,
case positivity in the ER, case
positivity requiring ICU care,
case positivity requiring
intubation, and there
is kind of a standard stereotypical
(18:06):
progression, a relationship between
all those numbers that we've used
to strategically allocate labor
through the pandemic.
It's less an issue now when we're
not tracking daily ICU
census daily intubation census
through the health center. But at
the peak of the pandemic and when
Delta resurged, which which required
many intubations, Omicron, not so
much, but with each of those,
(18:26):
we were able to more
accurately deploy the required
labor rather than undercutting it,
or worse from a financial
standpoint, over assigning
very expensive, very highly
skilled nursing care in the ICU.
And so that was one major difference
that helped us kind of shave
some of the agency cost off.
However, I should mention that
(18:47):
a lot of this labor cost is coming
from the the
most highly skilled nurses who
populate the E.R.,
the ICU and the O.R.
And so
that that that was one major
initiative that has helped us recoup
a little bit. And at this point,
we're employing less and less
agency nursing labor
(19:08):
and the health system as, quite
frankly, demands go down.
However, it we're
still really in the red
in terms of labor expenditure versus
margin throughout the health system.
I think many, many large
referral health systems are still
experiencing this and this this
concept, this these facts just go
to show that this is this is not a
new concept of nursing
(19:29):
labor shortage and very expensive,
highly skilled nursing labor.
In fact, it's been kind of
burgeoning and snowballing, if you
will, for the past decade or so.
As more and more nurses enter
graduate training,
nurses, nurse anesthetist training,
other graduate types of training
to further their careers.
And many nurses are retiring
(19:50):
as well. And that say somewhere
in the paper that they're predicted
to be about a million nurses
required from the American nursing
workforce between 2020
and 2030.
And those are not young
out of school inexperienced, just
out of school, more inexperienced
nurses. Those are probably the most
highly skilled and
(20:11):
most knowledgeable nurses
in the field.
Those people are going to be very
difficult to replace and it won't be
cheap. And so there's been
an ongoing nursing shortage since
the late 20th century that
quite frankly, really hasn't been
addressed. And the head of
the ANA recently
encouraged the the
(20:32):
US Department of Health to to
declare an emergency based on the
nursing shortage.
And that was that was early in the
pandemic and that was based on
pre-pandemic figures.
So the bottom
line there is that this is not a new
problem. It's decades long
in evolution, and it simply
was intensified very rapidly
by the pandemic.
(20:52):
Well, it's definitely not a new
problem, but your paper definitely
shined a new light
and provided a new perspective with
some really great data.
And thank you so much, Dr. Brinster,
for taking the time to discuss your
article with us.
And thank you to our listeners as
well.
If you have any feedback for us here
at The Operative Word, please drop
(21:13):
us a line at Postmaster@facs.org.
Thank
you for listening to the Journal of
the American College of Surgeons
Operative Word podcast.
If you've enjoyed today's episode,
spread the word on social media by
using the hashtag
#JACSoperativeword.
Subscribe to The Operative Word
wherever podcasts are available
(21:34):
or listen on the American College of
Surgeons website at
FACS.org/podcast.
Welcome to the Operative Word,
a podcast brought to you by the
Journal of the American College of
Surgeons.
I'm Dr. Jamie Coleman.
And throughout this series, Dr.
Dante Yeh and I will speak with
recently published authors about the
motivation behind their latest
research and the clinical
implications it has for the
practicing surgeon.
(00:22):
The opinions expressed in this
podcast are those of the
participants and not necessarily
that of the American College of
Surgeons.
Welcome to the Operative Word, a
podcast from the Journal of the
American College of Surgeons.
I'm Dr. Jamie Coleman, one of your
hosts for this series.
In this episode, I am joined by Dr.
Clayton Brinster, and we'll be
(00:43):
taking an in-depth look into his
current article "Severe
Increase in Nursing Labor Cost
and Effect on Surgical Department
Financial Margins at an Academic,
Tertiary Medical Center."
Dr. Brinster is a senior staff
surgeon in vascular surgery
and the director of the Ochsner
Aortic Center at Ochsner Health
in New Orleans.
(01:04):
Dr. Brinster, welcome to The
Operative Word.
Thank you very much.
And like we were previously
discussing, it's really an honor to
be invited. And I hope to provide
some insight into a very challenging
topic.
Oh, definitely.
I can't wait to dive in on
this, actually. But before we do
that, do you have any conflicts of
interest you'd like to disclose?
No, I have no relevant financial
(01:25):
conflicts of interest.
Perfect.
Well, congratulations to you on both
the presentation at the Southern
Surgical Association and this
publication, and even
just more kudos for tackling
a topic that really has impacted
every single surgeon, regardless
of your specialty, regardless of
your practice setting.
(01:45):
Because, listeners,
today we are talking nursing
shortages, something I think
all of us have felt and really
an issue that's been felt at every
level within our healthcare system,
from our patients to our nurses
to the physicians and definitely
to the administrators.
To provide a statistic from
(02:06):
your paper, national
healthcare employment has dropped by
over 550,000
people with nursing and
residential care facilities
comprising about 4/5 of that
loss.
That is just an incredible
and sad statistic.
So I'm really looking forward to
getting into this.
(02:26):
And so for our members who
or listeners who may not have had a
moment to read your paper yet,
let's just kind of step back and
talk about the framework and
methodology of your study.
So you looked at nursing costs
and its impact on your financial
margins within the surgery
department and you compared two
periods of time (02:46):
pre-COVID,
which was January 2019
to February 2020,
and then COVID, which was March
2020 to December 2021.
So let's kind of break those two
chunks of data down.
Let's start out with the nursing
costs.
Can you tell us a little bit you
have very detailed methodology.
(03:06):
Can you please share with us a bit
on that?
Well, sure.
I think initially, just for
a little bit of background about how
we came to investigate this topic
in the manner we did.
Ochsner Health is in New Orleans,
Louisiana.
And if we can remember back,
which seems like many years ago,
(03:26):
at the very beginning of the
pandemic, New Orleans was
disproportionately affected by the
first wave of of COVID
infections.
It was one of the three cities,
primarily, I think, with New York
and Seattle, that really were the
first major cities
to be inundated with COVID
infections and have ICUs
and ERs overrun.
(03:47):
And so early in the pandemic,
as we all remember, our elective
surgeries were severely restricted
by by the American College
and by other governing bodies.
And so when those restrictions
were lifted initially three months
after the pandemic
was declared by the US government,
we became interested in the
financial losses for our vascular
(04:09):
surgery division only.
And when we looked at that, we saw a
severe dip.
Of course, during the period
when there was elective
restrictions, but a return
to normal, in fact, sometimes
higher volume in the months
directly after those restrictions
were lifted. And so when we first
put some data out examining
just pure financial revenues,
(04:29):
margins and
deficits caused by the lack of
elective surgery in those first
three months, what we saw was that
we had evened out pretty much about
six months after the pandemic
started, and we
did a brief calculation based on
some other studies we saw in some of
some of our own metrics to calculate
how much of a RVU
(04:51):
overage per month it would take to
recoup that data.
And in short, it would take a very
long time.
Severe
RVU overages of five and 10%.
Both were years long processes to
recoup what we lost in just three
months. But when we
we looked at extending that
data for
the manuscript, which
(05:13):
by my own fault, took a little bit
of time to get going.
What we what we saw was that our
RVU generation was consistent.
However, after a brief
return to normal values
of margins with
consistent RVU generation up to
a year or two after that
initial or I guess a year to
18 months after that initial
(05:34):
deluge of COVID and restrictions,
we saw that there was a gradual
erosion of overall
surgical margin, financial
margin within the vascular surgery
division
here at Ochsner
starting really in the beginning of
of 2021.
So it was a little bit of a puzzling
(05:55):
result because every month we had
met our pre-pandemic
metric for RVUs or in many cases
there were overages each month
and still our financial margin was
deteriorating. And so
with with Thomas
Escousse, who is an MBA,
worked here at Ocshner, carefully
analyzing and tracking
(06:15):
financial metrics within the surgery
departments, he and
I looked very closely at what was
happening. And we we
saw a very obvious
increase in labor expenses,
particularly nursing labor expenses,
which arose not only from
nurses requiring more pay because
more and more nurses were infected
(06:36):
with COVID and taking mandatory
leaves and quarantines.
But because there was such a
rearrangement of the actual
labor force that agency nurses
were being employed in a way that
we'd never experienced before.
And the average labor
expenditure for the hospital and
nursing rose astronomically, as
we saw and I quoted in the paper.
(06:57):
And so when we looked into the
proper methodology to get back to
your original question about how to
properly how to properly analyze
this, basically we tracked
nursing expenses, and nursing
expenses were tracked on a daily
basis at our institution
by a combination
of artificial
intelligence and also a daily
(07:18):
record, a daily monitor that was
kept on a per unit basis.
And so we could see, based
on the way Ochsner tracks data
which nurses are in
which respective units
and how many of those nurses were
Ochsner employed nurses and how many
were agency nurses.
And so we had not only the total
(07:38):
cost of nursing, we had the number
of nurses per shift per unit
and the number of agency nurses per,
per unit per shift, and that
was that was tracked in an ongoing
daily basis. And so
it was the careful organization
and analysis of that data that
allowed us to look back and
look at real numbers.
And I should mention that
(08:00):
a key distinction to a lot of
financial studies which take place,
we did have access to the actual
contractual numbers that
were paid not.
Just estimates, both
for the
cost and also for
RVU.
Most of our patients, as many
medical centers, are
Medicare patients, and
(08:22):
so many institutions
rely on administrative
projections or Medicare estimates
for that denominator.
However, we have access to the real
numbers at Ochsner, which is a
benefit.
So we can predict and analyze what
is actually happening.
And that's and that's a huge
variable for so many centers.
And I think it was just
(08:43):
it helps really
put these findings into context
when you realize these are real
numbers, these aren't,
like you said, this isn't just a
projection or an estimate.
And so tell us a little bit
then about how you calculated
your financial margins.
Well, the margins the margins are
tracked in the same way.
(09:03):
So we have access to the real
accounting and billing numbers, like
I mentioned. And you just
acknowledged that it was really
startling to us when we saw the
actual revenue.
We analyzed net revenue
right up right on a on a monthly
basis. And that has to do with RVU
generation and
and costs as well.
(09:24):
The majority of that
was labor costs that was increasing
here. Of course, there are other
costs such as equipment,
transport, all sorts of other
silos. But when you look at the data
from our paper, the major increase
in the bulk of the of the costs
that we were fighting that were
eroding the financial margins was an
increase in surgical nursing labor
per month.
(09:45):
To standardize that, just as you
mentioned there, although Medicare
is an umbrella organization, of
course there is a major variability
in costs and
margins in different regions.
And so to reduce
the subjectivity of it, I'm sure
we'll come back to this topic.
We we compared
(10:06):
these numbers and standardized them
on an RVU basis
because the RVU is not something
that that varies
from region to region, from call
center to health center.
And so when we
that that was really, I think, the
most powerful data or some
of the most powerful data that we
shared because the RVU is a
universal standard around the
(10:27):
country.
Agree this really took it
and broke down the problem
in a way that with your dollar
or your cost per RVU,
which we're going to talk about a
second because I want you to
summarize your finding for us.
But it really contextualized it and
it made it something that anyone
picking up this paper can read
and it translates to their
(10:48):
center.
So I thought that I agree.
I thought the way that you all
really broke this down and presented
it just made
this such an important and
translatable translatable
paper.
So yeah, let's let's go ahead and
dive into that. Let's, let's dive
into the findings.
So what did you find?
So you looked at how much nursing
was costing you.
(11:09):
You looked at how that impacted
your margins, your bottom line
in the surgery department.
How bad was it?
Well, it was pretty severe.
And as you can see from the paper, I
think that could direct people if
they have access to it or want to
write it down. Table 1 really
summarizes the the major
metrics that we looked at.
And when we looked, we
(11:29):
as you mentioned, we we compared a
14 month pre-COVID cohort
to a 21 month COVID cohort
which started at the beginning of
the pandemic.
And when we broke those numbers
down, we saw on a per month
basis surgical nursing labor
increased by 17%.
And so I think when you're inside
some medicine, you hear percentages,
you're not really sure what they
(11:50):
mean. But when we talked,
when I was learning about this topic
early in the pandemic, it
occurred to me that that is an
astronomical number, because when
you think of how many health
systems, most health systems
operate, most are
between a -3%
and a positive 3% operating
margin on in any given year.
And in fact, the average operating
(12:11):
margin for U.S.
hospitals and health centers before
the pandemic was about a positive
1.5%.
So when you have a major silo
of costs, that increases 17%.
That that's that's startling.
That really, I think, puts fear
into the administrators
and government officials as well.
(12:31):
And so combined with that
increase we saw when we compared
pre-COVID to COVID
periods, we saw that the
departmental that is Department of
of Surgery, not including
subspecialties such as
orthopaedics, neurosurgery and
others, but yes, including urology,
plastic surgery, vascular
cardiovascular or colorectal
acute care surgery.
(12:52):
When we looked at that, we saw that
the financial margin within the
department had decreased 11%.
When we compared those two cohorts,
again, both of those values were
significant based on statistical
analysis, and both are really
pretty startling numbers when you
compare those to the operating
margins we just discussed,
when we looked at at
(13:14):
the RVU generation of the entire
department, we found that while
there was a slight drop off
when we compared the two cohorts, it
was not statistically significant.
And so we knew
that there was a reason besides
a decreased RVU generation
per month, which was not significant
compared with with the strongly
significant values of increased
(13:35):
surgical nursing labor and
deteriorating departmental financial
margin per month.
As we were just talking about when
we looked at the nursing, surgical
nursing expense, per RVU,
which I have to give credit to Dr.
Sam Money, who really
that was really his idea
to look at that as a standard
(13:56):
benchmark to make
our data more translatable.
We saw a staggering increase
that was statistically significant
in nursing expense per RVU.
And this is in the face of
insignificant or not significant
changes, I should say, between the
two cohorts of traditional metrics
which can affect revenue.
And those include things we're all
(14:16):
familiar with, like length of stay
per case, case mix index,
which is determined by standard
metrics and the case volume per
month. And not none of those
three was statistically
significant. So what that
basically means in a nutshell is
that traditional metrics, RVU
generation, length of stay per
(14:36):
case, case mix severity
index and case volume per month did
not change significantly when
we looked at the two cohorts.
But what did change in a startling
fashion were the two metrics
we just discussed, surgical nursing
labor per month and the financial
labor per month.
With labor getting much more costly
and margin gradually being eroded.
(14:57):
And just to drop some numbers in
here from your paper, you had an
average monthly increase
of $330,000
in nursing expenses, which
represented an additional
$1,243
per case.
And in terms of this cost per RVU,
cost per RVU went
(15:17):
from $110 to
$148 in
the COVID era.
And again, you're like, Oh, okay,
$38, but $38
per RVU.
I mean, that's just an astronomical
cost. And you also
included system-wide
data on this as to what
drove it.
(15:38):
And one of the things that you
mentioned, that agency-related
nursing costs increased
from $5.1 to
$13.5 million
per month in
2021 compared
to even 2020.
So this problem
(15:59):
is it didn't just show
up and it went away.
It's still here.
And when you start thinking about
these numbers, you're talking about
17% for these
margins, this is clearly
unsustainable.
So what has happened in your
institution? What sort of solutions
have you
found or are you working out?
What sort of changes have been made
(16:20):
in your location to
help with this?
The numbers you mention there are
staggering, really. Like you
mentioned, nursing costs
5 million, about 5 million per month
during during the first year of the
pandemic. So that's that's an
increase from prior to the
initiation of the pandemic
costing costing an additional
over $100 million for the health
(16:41):
center in 2021
on agency nursing labor.
I mean, that's really a staggering
number.
Initiatives have been taken
throughout the pandemic to try to
limit that that increase.
However, with the emphasis on
patient care and being the largest
health system in the Gulf South, and
one of only two really big tertiary
care centers in this region, the
other being LSU's hospital.
(17:03):
Patient care was always first and
we were always taking COVID patients
from around the region and
taking the most acute tertiary cases
from all over the Gulf South, of
course. But now that the pandemic
has waned, and I should mention that
it when we looked at these
numbers, every number, every metric
was intensified and followed waves
of COVID in the region as we tracked
(17:25):
with public health data.
So there really can be no doubt that
there is a there's a direct
causal relationship here.
But when we when we think about
where Ochsner is going from here,
we've alluded to a little bit
before, we've used to
increase the sophistication
of labor deployment and redeployment
(17:45):
in the hospital, we
have utilized several different
types of artificial intelligence
and machine learning to predict
case positivity in the community,
case positivity in the ER, case
positivity requiring ICU care,
case positivity requiring
intubation, and there
is kind of a standard stereotypical
(18:06):
progression, a relationship between
all those numbers that we've used
to strategically allocate labor
through the pandemic.
It's less an issue now when we're
not tracking daily ICU
census daily intubation census
through the health center. But at
the peak of the pandemic and when
Delta resurged, which which required
many intubations, Omicron, not so
much, but with each of those,
(18:26):
we were able to more
accurately deploy the required
labor rather than undercutting it,
or worse from a financial
standpoint, over assigning
very expensive, very highly
skilled nursing care in the ICU.
And so that was one major difference
that helped us kind of shave
some of the agency cost off.
However, I should mention that
(18:47):
a lot of this labor cost is coming
from the the
most highly skilled nurses who
populate the E.R.,
the ICU and the O.R.
And so
that that that was one major
initiative that has helped us recoup
a little bit. And at this point,
we're employing less and less
agency nursing labor
(19:08):
and the health system as, quite
frankly, demands go down.
However, it we're
still really in the red
in terms of labor expenditure versus
margin throughout the health system.
I think many, many large
referral health systems are still
experiencing this and this this
concept, this these facts just go
to show that this is this is not a
new concept of nursing
(19:29):
labor shortage and very expensive,
highly skilled nursing labor.
In fact, it's been kind of
burgeoning and snowballing, if you
will, for the past decade or so.
As more and more nurses enter
graduate training,
nurses, nurse anesthetist training,
other graduate types of training
to further their careers.
And many nurses are retiring
(19:50):
as well. And that say somewhere
in the paper that they're predicted
to be about a million nurses
required from the American nursing
workforce between 2020
and 2030.
And those are not young
out of school inexperienced, just
out of school, more inexperienced
nurses. Those are probably the most
highly skilled and
(20:11):
most knowledgeable nurses
in the field.
Those people are going to be very
difficult to replace and it won't be
cheap. And so there's been
an ongoing nursing shortage since
the late 20th century that
quite frankly, really hasn't been
addressed. And the head of
the ANA recently
encouraged the the
(20:32):
US Department of Health to to
declare an emergency based on the
nursing shortage.
And that was that was early in the
pandemic and that was based on
pre-pandemic figures.
So the bottom
line there is that this is not a new
problem. It's decades long
in evolution, and it simply
was intensified very rapidly
by the pandemic.
(20:52):
Well, it's definitely not a new
problem, but your paper definitely
shined a new light
and provided a new perspective with
some really great data.
And thank you so much, Dr. Brinster,
for taking the time to discuss your
article with us.
And thank you to our listeners as
well.
If you have any feedback for us here
at The Operative Word, please drop
(21:13):
us a line at Postmaster@facs.org.
Thank
you for listening to the Journal of
the American College of Surgeons
Operative Word podcast.
If you've enjoyed today's episode,
spread the word on social media by
using the hashtag
#JACSoperativeword.
Subscribe to The Operative Word
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(21:34):
or listen on the American College of
Surgeons website at
FACS.org/podcast.
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