Frequent Questions
 (last updated 03/08/08 )

***** Answers to Frequent Questions *****

Section: Division of Management Consulting

What relationships does the Division of Management Consulting have with healthcare consulting firms?

A primary focus of the Department of Anesthesia’s Division of Management Consulting is in assisting other organizations in using and in developing state-of-the-art methods to analyze OR information system, anesthesia information management system, anesthesia billing, hospital financial, and hospital discharge abstract [marketing] data. These methods include optimization based on linear, quadratic, and stochastic programming techniques. Much of our work is performed for healthcare consulting firms. We supplement the services they offer to their clients by providing analysis and interpretation that the firms currently do not have the in-house expertise to perform. In that all of the methods we use have been published in peer reviewed journals, they are relatively easy to explain to clients. With some of the consultants with whom we have worked, their clients have been unaware of our involvement, and likewise we have no idea who is the client and where the data came from. Some consulting firms have chosen, alternatively, to present the Division as an academic sub-contractor providing advanced statistics and robust mathematics. Clearly, the largest part of any process improvement process is not in the analysis, but in achieving the organizational development. These steps are directed by the consultants, not us.

What financial relationships are there among people in the Division of Management Consulting, including Franklin Dexter?

No member of the Division receives any funds personally, including honoraria, other than his or her salary and allowable expense reimbursements from the State of Iowa. No member has financial holdings in any company related to their work, other than indirectly through mutual funds for retirement. Both Franklin Dexter and Ruth Wachtel have tenure and do not participate in any incentive programs.

Can you obtain the data that are needed from my information systems?

We have a well established business process that allows for the efficient retrieval of information from a hospital’s OR information system, anesthesia information management system, and/or anesthesiology group’s billing information system. We have used just about every such system, and so have considerable experience in extracting and cleaning such data.

How can I get the software to run the analyses that you have published?

The Division of Management Consulting provides outsourced analytical support. If you send your OR information system, anesthesia information system, and/or financial data to us, the Division will perform the statistical analyses for you, generally within one week. Many of these analyses are performed using the CalculatOR™ software package. Reports are then discussed by phone and web conferencing. Whereas any interested manager or clinician can quickly learn the results of the analyses and how to implement them, many organizations lack in-house staff with the strong background in statistical methods that is required to perform the analyses, test the statistical assumptions, compensate for missing data, and so forth. The alternative to outsourcing data analysis is to perform the statistical analysis in-house by individuals who have been specifically trained in the appropriate methodologies. To become facile in performing the calculations, typically several weeks of full-time training are required. Maintaining these skills is challenging, since the methods are typically performed only once or twice a year. If you are not sure, you may want to take one of the courses listed on our Home page.

How can the Division of Management Consulting help a new OR manager?

For the operational and financial aspects of OR management, it is important to learn and apply the science, because it is not intuitive and there are not data that experience improves decision-making. One of the quickest and least expensive ways to learn the science is not to rely on yourself to find precisely the right material or to hope that a conference will cover precisely the right topic in a format that you can apply. Instead, budget a few hours of an expert’s time per month, available by telephone, e-mail, web conference, etc. As needed, describe your problem and have the person you choose send you to the relevant section of the most appropriate and recent paper, critique your recommendations, and/or recommend how to improve the quality of the internal reports that you are being provided. The Division of Management Consulting at the University of Iowa has been doing this type of work for several years. Frequently, the OR manager starts by having the Division perform a quantitative assessment of operational and financial performance of the surgical suite, as described in the Consulting page of the web site. This baseline assessment can help the new OR manager determine rapidly which problems to focus on first to improve a desired goal.

I am interested in learning about operating room management. What key papers would you recommend that I read?

Click here to download slides or lectures. That may be the most helpful. I have selected several papers that include long background sections or that stand alone with key results. Click on each of the following links to get the reference and abstract for each paper, or click on [PDF] to download the full article.

Impact of service-specific staffing, case scheduling, turnovers, and first-case starts on anesthesia group and operating room productivity: tutorial using data from an Australian hospital [PDF]

Making management decisions on the day of surgery based on operating room efficiency and patient waiting times [PDF]

Tactical decision making for selective expansion of operating room resources incorporating financial criteria and uncertainty in sub-specialties’ future workloads  [PDF]

Tactical increases in operating room block time based on financial data and market growth estimates from data envelopment analysis  [PDF]

Tactical increases in operating room block time for capacity planning should not be based on utilization  [PDF]

Economic analysis of linking operating room scheduling and hospital material management information systems for just in time inventory control  [PDF]

How to schedule elective surgical cases into specific operating rooms to maximize the efficiency of use of operating room time  [PDF]

Use of operating room information system data to predict the impact of reducing turnover times on staffing costs  [PDF]

Strategies to reduce delays in admission into a postanesthesia care unit from operating rooms

What management reports do you recommend for operating rooms?

Click here for a sample report from an OR Staffing and Allocation consult. This includes the operational reports I recommend. Click here for a review article that describes many of those analyses. In addition, financial performance should be measured. Click here for a two-page summary of financial performance measurement, and click here for a lecture on the topic. The first half of the lecture provides multiple reasons why neither adjusted utilization nor raw utilization is a valid surrogate for the statistic "contribution margin per OR hour". Click here to read the abstract describing that contribution margin per OR hour applies to tactical decision making or click here to download the full article. Click here to read the abstract of the follow-up article or click here to download the full article. Click here to read the abstract describing that the standard error of the contribution margin per OR hour can be measured and its important effect incorporated into the analysis or click here to download the full article.

Can OR efficiency methods be applied to a surgical facility with few data, or should data on cases and processes be collected first?

With respect to OR allocations and staffing on workdays, the most important data are the time of the end of the last case of the day in each OR. Sometimes this can be inferred from employee time cards. The incremental value of each additional datum is sometimes small. Consider two scenarios. In scenario A, there are data for two months on the times of the last case ending in each OR. In scenario B, there are data for two weeks on all of the cases. Scenario A would be much more beneficial. In  some situations, the incremental value of collecting more data, as opposed to simply using expert opinion, will be negligible. For example, suppose that the workday begins at 7 AM. The managers are polled to estimate when the salaried orthopedic surgeons finish their cases in an OR. The managers guess that the surgeons finish their elective cases between 2:45 PM and 4:15 PM each workday. In that circumstance, there would be little incremental value in collecting more time data. Click here to download the full article. Adjusting staffing would have negligible impact on OR efficiency, as would reducing turnover times. Click here for the abstract or click here to download the full article.

With respect to improving decision-making processes, creating scenarios manually can be a quicker way to evaluate processes than via observation. For a description of scenarios, download this PDF. In one full day with one or two experienced on-site day-to-day manager(s), the scenarios will have been created manually. By the end of the day, (a) you'll have a good assessment for how all of the managerial decisions are being made and (b) how far those decision processes are from that which is the optimum based on the ordered priorities. Using detailed data on all cases to create the scenarios automatically is preferred, because such data are unbiased and do not take the managers time. However, use of the scenarios as pre-designed role plays and mock up of decisions is a far faster process than observation. The scenarios may also train the manager(s) in the process of their assistance. Completing the scenarios for longer-term educational value would take another day of work.

A surgical facility is a public hospital where profit is not a motive and the physicians are all salaried professionals. Can OR efficiency methods be applied?

This is sometimes precisely the situation where the tactical (strategic) analyses based on financial criteria apply. For example, consider the hypothetical hospital three paragraphs above that finishes all ORs between 7 hr and 9 hr after the start of the workday. This seems to occur often when salaried physicians won't make more money for working longer for elective cases. In that circumstance, reducing turnover times will generally create more under-utilized OR time, not increase OR efficiency because there are no over-utilized hours to reduce. Click here to download a paper reviewing these concepts. 

Staffing analyses are of the greatest value when some ORs have under-utilized OR time and some have over-utilized OR time each workday. In this scenario, there may be little opportunity for improvement in OR efficiency by adjusting staffing, because there are few under-utilized or over-utilized hours. Click here for corresponding lecture. Often it seems that, at such hospitals, the limiting factor in caring for more patients is the annual budget. 

Tactical (strategic) decision making based on the large differences in variable costs per OR hour among surgical specialties may be of greater value than consideration of OR efficiency. My impression is that, at such facilities, often when people on-site speak about "efficiency," what they truly mean is providing care for more patients with available resources. That is not OR efficiency as studied scientifically, but a tactical (strategic) decision-making problem. Click here for the related lecture. The incremental reimbursement for each patient may equal zero, or can be represented from a societal perspective as a value per patient treated. The principal issue is to use resources wisely focused on the individuals, departments, and specialties providing the greatest return.

We are implementing “block” OR allocation – any pointers?

First, nothing is more important financially when implementing or adjusting blocks than calculating the correct allocations. A good summary of a decade of science is to allocate OR time based on OR efficiency, not based on OR utilization. Allocating OR time based on OR utilization is both logically and computationally flawed, and consequently will often give the wrong answer to the problem. If you allocate too much OR time, then much will be under-utilized, thereby reducing OR efficiency. If you allocate too little, then there will be many over-utilized to finish the cases, resulting in even more expensive over-utilized hours. Click here for a lecture or click here for a review article.

What is the average OR utilization in the United States?

The value is not known, nor can it be known, because operating room utilization cannot be measured accurately with sufficiently brief duration data sets as to be practical. There are three reasons. First, the “surgical service” refers to a group of surgeons who share allocated OR time. An individual surgeon, a group, a specialty, or a department can represent a surgical service. There is usually heterogeneity among services in their adjusted and raw utilization. Thus, the overall average utilization at a facility is of unclear importance. Second, for services that have been allocated one OR on some days of the week, the utilization cannot be measured accurately unless the value is too low or high as to be of no practical value (click here for the abstract or click here to download the full article). Third, for services that have been allocated two or more ORs on some days of the week, one such OR can have under-utilized OR time (i.e., adjusted utilization < 100%) while another such OR has over-utilized OR time. Then, the average utilization has no relationship to costs, efficiency of use of OR time, or OR staffing.

With this being said, there are many ORs in the US with fewer than 8 hr of cases per OR per day. Eleven community anesthesiology groups in the U.S. had an average of 6.0 hr of anesthesia time per OR per day (click here). Eight community hospitals in the U.S. had an average of 5.5 hr of OR time per OR per day in their ORs used for knee or hip replacement surgery (in press). US hospitals nationwide averaged 2.1 cases per OR per day (click here). At a series of academic hospitals, many ORs had less than 8 hr of cases per OR per day (click here and click here).

What is a good OR utilization value for a surgical suite? What’s too low or high?

Sixty percent is absurdly low, and 95% is too high. The range is too large to be useful, which is why the answer to the question is that analysis needs to be performed for each surgical suite. Almost always when someone is measuring utilization, this is for tactical decision making as described here and reviewed here.The reason for this is that utilization best applies when one considers ORs as being a fixed resource, not finishing late. From a “macro” perspective, which is quite suitable from a tactical perspective, that is fine. From an operational perspective, and particularly on the day of surgery, this is quite absurd. Allocating OR time based on OR utilization is both logically and computationally flawed, and consequently will often give the wrong answer to the problem. Instead, OR time should be allocated based on OR efficiency (Click here for a lecture or click here for a review article). The latter considers not just under-utilized OR time (i.e., utilization), but also the higher cost of planning too little OR time resulting in more expensive over-utilized OR time. Whereas decision-making based on OR utilization relies first on knowing “what utilization is best,” there is one single answer to best staffing based on OR efficiency and minimizing staffing costs.

What example shows the difference between allocating OR time based on OR efficiency versus OR utilization?

Consider a service with total hours of elective cases including turnover times averaging 5 hours every Monday. The service was allocated a single OR for 8 hours. Then, its adjusted utilization is 62%. There are 3 under-utilized hours and 0 over-utilized hours. Because there are no over-utilized hours, allocation based on OR efficiency is identical to allocation based on OR utilization. In contrast, suppose that the same surgical suite has 3 of its 8 ORs as unblocked, open, first-come first-served, other time. The surgical suite staffs in 8 hr, 10 hr, and 13 hr shifts, where 13 hr = 40 hours a week / 3 days per week. Then, those 3 ORs could be allocated as 8/8/8, 8/8/10, 8/10/10, 10/10/10, 8/8/13, 8/13/13/, 13/13/13, 8/10/13, 10/10/13, and 10/13/13. Only by calculations based on OR efficiency, which considers both expected under-utilized and over-utilized hours of OR time, can a good staffing decision be made. Click here for a review article.

We allocate OR time to individual surgeons. Can we still use the methods, since they plan OR time allocation to services?

Surgical service refers to a group of surgeons who share allocated OR time. An individual surgeon, a group, a specialty, or a department can represent a surgical service. Surgical service simply refers to the unit of OR allocation. For example, suppose that all of the cardiothoracic surgeons practicing at a hospital are allocated OR time. Then, cardiothoracic surgery would be a service. For example, suppose that two otolaryngologists are partners in one of three otolaryngology groups that practice at a hospital. If the two otolaryngologists are together allocated OR time, then they would represent a service. For example, suppose that a busy surgeon is personally allocated 10 hr of OR time every Wednesday. Then, from the perspective of OR time allocation, that surgeon would represent a surgical service. Click here for a review article.

How is OR staffing determined?

"Staffing" refers to the number of OR teams planned at each time of the day and on each day of the week. During scheduled work hours on weekdays, staffing by specialty is determined from the OR workload of different specialties. Click here for a lecture on the topic. Click here for a review article. During the afternoons and evenings of weekdays, staffing is often less, by specialty, than during weekdays. Staffing can again be determined from the OR workload, but using different statistical methods. Click here for a lecture on the topic (based on anesthesia staffing, but also applicable to OR nurses). Click here for the abstract of the paper in AORN Journal (directed at OR nursing staffing). This graphical method to analyze 3 PM to 11 PM staffing also works well for 11 PM to 7 AM staffing, and in practice is implemented simply by subtracting 8 hours from each of the DateTime fields thereby treating all cases performed between 11 PM and 7 AM as if they were done between 3 PM and 11 PM. During the weekends, staffing in-house and on call from home should be determined from OR workload and the patient acuity. Click here for the abstract in AORN Journal describing the steps. Click here for an article about holiday and weekend staffing. Download Acrobat PDF describing one-time and on-going assessment of all three methods at your surgical suite. Download Acrobat PDF describing afternoon and weekend staffing at your surgical suite.

What is an appropriate subsidy for and productivity of an anesthesiology department?

Articles in the bibliography show that typical annual values are 8,200 to 12,100 ASA units per OR. The range is wide, because productivity depends on CRNA:MD concurrency, number of anesthetizing locations covered, typical durations of the OR workday, how OR time is allocated, how cases are scheduled, how anesthesia providers are scheduled, how cases are assigned, and so forth. Appropriate productivity and a subsidy can be calculated using OR information system, anesthesia information system, and/or anesthesia billing data. For details on how the Division of Management Consulting performs a subsidy analysis, download this file. Click here for the full article describing the methodology on which the subsidy analysis is based.

Why does the 2nd shift (afternoon staffing) analysis not consider variation in workload by day of the week?

Where can I get a list of guidelines for scheduling cases, moving cases, etc.?

For operations researchers planning to simulate a surgical suite, what hints can you recommend?

Click here to read one of our review articles. First, for scheduling, use a hierarchical process, where the primary “job” is the surgeon, and the secondary “job” are the surgeon’s list of cases for the day. Thus, you will have 1 or 2 non-preemptive jobs per machine per day. Second, for a tactical (e.g., 1-2 year) perspective, surgical suites can be considered to have fixed hours into which cases are scheduled. Because few ORs run 24 hr a day, unlike hospital wards, intensive care units, and emergency departments, the fixed hours are for staff and specialized equipment. For simulations of operational processes (e.g., 0 to 3 months before the day of surgery),