DCH Health System Strengthens Compliance and Cuts Costs

By Geoff Simpson

Director, Presagia

DCH Health System has more than 4,700 employees working in three west Alabama locations. Hospitals must be staffed 24/7 by specialists who perform highly technical, often physically demanding work, which can lead to a large volume of leave cases and high rates of absenteeism.

Reviewing its leave management strategy in 2013, DCH concluded that “Our system was failing to uphold the company’s values regarding employee treatment, as well as its core mission to provide high-quality care in the most financially responsible manner possible,” said Felicia Ellison, Director of Employee Health & Leave Management. At the time, all DCH leaves were managed by one specialist in each location, with no centralized record-keeping system.

“These three specialists followed a manual, paper-driven leave process that relied heavily on hard copies and physical files and documents,” Ellison explained. In this environment, the three specialists developed their own individual strategies for calculating eligibility and granting leave. The company risked excessive Family and Medical Leave Act (FMLA) leave durations due to miscalculations and poor return-to-work tracking. The lack of centralized data and reporting made it difficult to see into the system to determine what was and was not working.

Compliance efforts were further hindered by an overcomplicated leave policy document, a fixed-year calendar system, and an error-prone method of relying on employee managers to code intermittent leave call-ins. Solving these problems would require large-scale changes, which was difficult when the volume of leaves — an average of 624 open active cases per month — meant the team was already too overwhelmed to take proactive steps toward improving the system.

DCH identified a solution to overhaul its entire leave compliance system in a sequence of connected changes. After thoroughly researching its options, DCH found that outsourcing did not fit its hands-on culture or budget and decided to tackle the problem with technology. In early 2013, DCH worked to update its time and attendance software to include better attendance tracking and simultaneously integrated it with dedicated leave management software with Presagia. These newly integrated software solutions enabled DCH to consolidate leave case data, generate reports, and automate entitlement calculations and correspondence. This added simplicity allowed DCH to reduce leave management staff from three to one, as well as move some responsibilities to the Human Resources service center.

To overhaul intermittent FMLA coding, Ellison had to restructure and streamline the workflow surrounding intermittent leave call-ins. “Before,” she explained, “managers were often coding leaves as intermittent FMLA when employees hadn’t provided proof or their certification was several years old. Managers no longer code intermittent leave now.”

In the new system, those calls go to the Human Resources service center, which elevates the case to Leave Management when the employee is required to return medical certification for a leave. DCH provided training for managers and employees about recertifications and intermittent leave procedures. When managers were polled on their reaction to the new system, 71% responded that they understood the new method and were very satisfied with it.

These changes were the launching point for the next steps. To eliminate the possibility of employees “stacking” leave and to calculate entitlement more accurately, DCH switched to a rolling calendar system. At the same time, Ellison began reworking the internal leave policy document. The original document was disorganized and redundant, covering all leave types together. Ellison reorganized the document so it would be functional and useful. “I separated the document into family medical leave (FML) and non-FML, and formatted it so that the policy and procedure were separate. I created procedure sections for FML, military leave, and hospital medical leave that clearly describe the responsibilities for employees, managers, and leave teams,” Ellison explained.

Quickly following DCH’s comprehensive compliance overhaul, leave management improved in consistency, accuracy, and efficiency. DCH Leave Management and Human Resources service center staff report that they get significantly fewer complaints and questions from employees regarding leave practices. Employees and managers report that now they understand the leave management system they are working within. “We have streamlined communications between managers and the leave management program,” Ellison explained.

In the 2010 calendar year, DCH measured a $237,981 financial loss associated with employees exceeding annual FMLA leave entitlement. These costs were from sick bank payouts and overtime paid to replacement employees. Those losses decreased to $132,054 in 2012, but the biggest drop came in DCH’s fiscal 2014 when the number decreased to $3,176, after implementing their new leave management strategy. DCH also has measured a steady decrease in average lost workdays per leave since implementing the changes. This potentially large savings is unquantified, because it was untracked in the past, providing no benchmark for comparison.

“Having a more consistent, accurate approach allows me to feel secure,” Ellison said.

Greater visibility into the system allows a more complete understanding of what is happening in the workforce. Before, the lack of reporting meant Ellison and her team didn’t know what they didn’t know. It was hard to identify problems, let alone their cause. Now, DCH has three years of data and can analyze patterns and trends to support further change in the future.