Hospital Network: Employee Engagement, Patient Loyalty, and Leadership Development

For more than 15 years, Gallup has worked with one of the largest for-profit hospital networks in the United States. Throughout this time, Gallup's performance management solutions have helped boost the client's bottom line.

Recent Successes

• Gallup and the client implemented a system-wide program to improve employee engagement. Since the program began, more than 26,000 client employees have moved from being "not engaged" (neither positive nor negative about their work environment) or "actively disengaged" (fundamentally disconnected from their work) to being engaged, or emotionally invested, in their jobs. These engaged employees, according to the client's estimates, result in a savings of more than $46 million in reduced absenteeism costs alone.
  

• Over a three-year period, system-wide employee engagement levels increased in increments that closely reflected incremental increases in the client's stock price, which rose from $22 to $45 per share during this period.
  

• Gallup Business Impact Analysis, which assesses the connections between engagement levels and business outcomes, revealed a direct linkage between employee engagement levels and malpractice claim costs. Gallup consultants demonstrated that hospitals with the lowest levels of employee engagement (those in the bottom 25% in engagement scores) incurred an average of $1,120,000 more in malpractice claims per year than did hospitals with the highest employee engagement (those in the top 25% in employee engagement). System-wide, these under-performing hospitals cost the client more than $52 million in additional malpractice claims per year.

• Hospitals that improved their employee engagement mean scores by a factor of 0.20 or more also exceeded the corporate average of earnings per admission by $172. Hospitals whose employee engagement mean scores did not change or increased only marginally (less than 0.20) were below average in earnings per admission. Declines in employee engagement resulted in earnings that were approximately $161 per admission below average. According to client estimates and assuming an average of 8,000 inpatient admissions per year, hospitals that improved their employee engagement mean scores by 0.20 helped the client boost their bottom line by more than $48 million system-wide.
  

• Hospitals whose patients and physicians rate them in the top quartile on loyalty measures had approximately 80% higher earnings than hospitals in the bottom quartile on loyalty measures. According to client estimates and assuming an average of 8,000 inpatient admissions per year, top-quartile hospitals added more than $95 million per year to the client's earnings than did bottom-quartile hospitals.
  

• In a targeted intervention, Gallup and the client implemented a comprehensive performance management solution in a hospital experiencing high turnover among its nursing staff. Three years after launching a system that integrated employee engagement, talent-based hiring, and leadership development, this hospital experienced a 15% drop in nurse turnover.

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