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July 2019
Expense
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Expense by Region ?
A year-over-year comparison of Total Expense per Adjusted Discharge shows an unfavorable trend. All regions are facing growth in Labor Expense per Adjusted Discharge and, with the exception of the South, Non-Labor Expense per Adjusted Discharge. The Northeast/Mid-Atlantic region had the greatest increase in Labor Expense per Adjusted Discharge, and the Midwest had the smallest. FTEs per AOB remained flat year over year, except for decreases in the Great Plains and Midwest. All regions are experiencing increases in Supply Expense per Adjusted Discharge, with mixed results for Drug and Purchased Service Expenses.
Labor
Non-Labor
Supply
Drug
Purchased Service
FTE/AOB
Labor Expense
Non-Labor Expense
Supply Expense
Drug Expense
Purchased Service Expense
FTE per AOB
National Expense Observations
Expense indicators saw unfavorable performance in June compared to month over month, and even larger increases in expense year over year. Total Expense per Adjusted Discharge increased by 2.2 percent month over month and 5.6 percent year over year. Labor Expense per Adjusted Discharge increased by 4.9 percent year over year, and Non-Labor Expense per Adjusted Discharge increased by 5.3 percent, contributing to the variance in Total Expense per Adjusted Discharge.
FTEs per AOB remained flat year over year, but increased 2.7 percent month over month. Labor Expense per Adjusted Discharge increased by 1.9 percent month over month and 4.9 percent year over year. Organizations may have increased compensation per FTE or shifted skill mix to more expensive types of FTEs. Agency staff may also contribute to an increase in Labor Expense per Adjusted Discharge in regions where FTEs per AOB decreased. With Adjusted Discharges decreasing by 5.1 percent month over month and Labor Expenses increasing by 1.9 percent, more focus on management of labor expense may be needed as organizations experience a downward trend in patient volume if the acuity of patients has not increased.
Although Adjusted Discharges and Adjusted Patient Days decreased month over month, Non-Labor Expense and Purchased Service Expense increased by 2.3 percent and 2.5 percent, respectively. This may suggest inflexibility in Purchased Service agreement terms when organizations experience decreased volumes, particularly since both Supply Expense and Drug Expense decreased month over month.
Unless noted, figures are Actuals and Medians
Budget Variance
Month Over Month
Year Over Year
Year Over Year Distributions
(Click to enlarge)
Total Expense per Adj. Discharge
(0.8%)
2.2%
5.6%
total_expense.svg
Labor Expense per Adj. Discharge
(1.7%)
1.9%
4.9%
labor.svg
FTEs per AOB
(0.9%)
2.7%
0.0%
fte_per_aob.svg
Non-Labor Exp per Adj. Discharge
(1.6%)
2.3%
5.3%
non_labor.svg
Supply Expense per Adj. Discharge
(1.0%)
(0.6%)
8.6%
supply.svg
Drug Expense per Adj. Discharge
(6.1%)
(0.8%)
4.8%
drug.svg
Purchased Service Exp per Adj. Discharge
(2.8%)
2.5%
(2.0%)
purchased_service.svg
By Region
By Bed Size
National Observations
Expense by Bed Size
Total Expense per Adjusted Discharge shows unfavorable growth for all bed-size cohorts. Hospitals with 300-499 beds and more than 500 beds saw the greatest increase year over year. Labor Expense per Adjusted Discharge increased for all cohorts, and FTEs per AOB increased for hospitals with 0-25, 26-99, and more than 500 beds. Non-Labor Expense per Adjusted Discharge was unfavorable year over year for all bed-size cohorts, with the exception of hospitals with more than 500 beds.
Labor
Non-Labor
Supply
Drug
Purchased Service
FTE/AOB
Labor Expense
Non-Labor Expense
Supply Expense
Drug Expense
Purchased Service Expense
FTE per AOB
By Region
By Bed Size
National Observations
©2019 Kaufman, Hall & Associates, LLC
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