Hospitals Save More Than $120 Million in One Year as Members of Premier Healthcare Alliance Labor Management Program

With an Average ROI of 14:1, LaborConnect Tracks Labor Productivity, Performance and Costs to Help Hospitals Succeed in a Reform Environment

CHARLOTTE, N.C.--(BUSINESS WIRE)--During a period of economic uncertainty, 150 hospitals and healthcare systems saved more than $120 million in labor and supply costs over the past year by participating in LaborConnect^®, a Premier healthcare alliance labor management program.

“Effective labor management practices are critical to appropriately control expenses, reduce bottom-line costs and create sustainable improvements.”

LaborConnect helps hospitals further control labor costs and improve how they deliver care. Ninety-five acute care facilities and numerous affiliated outpatient entities nationwide joined the program within the last year, with participants enjoying an average a 14 to 1 return on investment (ROI).

“According to a recent American Hospital Association report that examined spending growth on patient care, from 2007 to 2008 the single most important factor driving up costs was labor, accounting for about 35 percent of overall growth,” said Eric Kammer, national director of operations for Premier. “Effective labor management practices are critical to appropriately control expenses, reduce bottom-line costs and create sustainable improvements.”

Continued Kammer, “Based on Premier’s experience and research of best practices, a sustainable labor management solution contains four main components: using benchmarking data to identify directional improvement opportunities and create priorities; frequent measurement of productivity performance against established targets; integrated quality measurement and expectations to ensure balance of performance; and coaching and intervention to support department leadership efforts in achieving goals and expectations. LaborConnect helps hospitals reach operational efficiency, essential to success under healthcare reform.”

Presbyterian Healthcare Services saved $10 million while using LaborConnect. The healthcare system expects to save an additional $7 million in 2010 with the program.

Frederick Memorial Healthcare System, of Frederick, Md., was able to save more than $6 million in labor costs with LaborConnect. As a part of the program, an on-site Performance Partner improvement expert provided six days per month of consulting services that helped develop, refine and better manage their labor plan.

In six months of participating in the program, Haywood Regional Medical Center, a rural facility, licensed for 189-beds in Clyde, N.C., achieved savings of $3.62 million in its labor costs. Their Performance Partner also aided in their ROI of 74 to 1.

The 500 acute care facilities that are members of LaborConnect have access to Premier’s OperationsAdvisor^® productivity and benchmarking solutions, as do the numerous outpatient entities, which include physician offices, urgent care centers, stand-alone imaging centers and clinics. OperationsAdvisor is the only Web-based, total labor management solution that fully integrates a productivity measurement system with quarterly benchmarking. Premier’s Performance Partners experts work with leadership and managers to improve operational performance and productivity.

LaborConnect also provides access to the Premier Performance Improvement Portal™, a library of industry best practices, as well as a networking community for knowledge sharing and interaction with industry specialists, hospital and health system peers and Premier's knowledge experts.

Additionally, Premier recently launched the California Labor Management Collaborative (CLMC) which will use LaborConnect. The collaborative aims to help participants improve efficiencies while maintaining care quality by comparing their labor expenses and productivity levels to peer hospitals, as well as state and national top performers.

About the Premier healthcare alliance, Malcolm Baldrige National Quality Award recipient

Premier is a performance improvement alliance of more than 2,400 U.S. hospitals and nearly 70,000 other healthcare sites working together to achieve high quality, cost-effective care. Owned by not-for-profit hospitals, Premier maintains the nation's most comprehensive repository of clinical, financial and outcomes information and operates a leading healthcare purchasing network. A world leader in helping deliver measurable improvements in care, Premier works with the Centers for Medicare & Medicaid Services and the United Kingdom's National Health Service North West to improve hospital performance. Headquartered in Charlotte, N.C., Premier also has offices in San Diego, Philadelphia and Washington.

http://www.premierinc.com