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Clinician Shortages Driving Up Hospital Labor Budgets

A Guidehouse/HFMA study of provider executives about labor productivity, staffing shortages, and operating expenses

Clinician shortages are challenging hospital leadership to reduce labor costs, a new Guidehouse/HFMA analysis suggests. Addressing the shortage of these specialized positions presents healthcare workforce management challenges and is likely causing hospitals to project higher labor budgets in the coming year.

According to the survey of CFOs and operations execs: 

  • Current nurse and physician shortages represent areas of both the largest increases and reductions compared to a year ago, but mental health provider shortages may represent the direst situation.
  • 78% of execs predict an increase in labor budgets over the next year, with almost 1-in-5 projecting surges of 5%+; Just 14% predict decreases, none more than 5%.


The survey also suggests leadership is targeting labor, healthcare workforce management and supply chain productivity improvements to reduce hospital operating expense over the next 12 months.

Survey results below. Download the PDF. View the infographic.

Guidehouse hfma 2018 Labor Management Trends from Guidehouse

The need to more effectively manage labor by staffing to demand will only intensify as operating margins continue to diminish, and as the pressure to enhance care quality and efficiency increases.

Danielle Dyer
Managing Director, Guidehouse

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