Effects of Manpower Utilization on Cost and Productivity of a Neighborhood Health Center

Abstract

Manpower is a major cost component in today's health care system, absorbing at least one half of the average health care dollar. Growing pressures to achieve cost containment and rationalization of scarce health manpower will force health care institutions to rely increasingly on management techniques for examination of choices, for guidance of activities and for evaluation of outcomes. In recent years much effort has gone into developing analytic and quantitative techniques for application to the health field, an effort that has produced a rapidly growing literature. Some of the tools are still subjects of pilot testing and further refinement; but others, whose usefulness has been demonstrated, are available for implementation by management of health facilities.l-4 This paper describes a methodology for evaluating manpower utilization in ambulatory health care facilities and illustrates its uses as a management tool. Several applications of the methodology will be discussed: (a) development of staffing standards; (b) assessment of resource allocations relative to objectives; (c) allocation of departmental costs between patient care and non-patient care services; and (d) assessment of cost-effective-