Size and Staffing Modeling
Observation patients require a hospital stay, even though they are technically deemed outpatients. During this time, their condition may require additional diagnostic work-up, treatment, serial exams, or sub-specialty consultation prior to further disposition. These patients are often handled in a “scatter-bed” model and are cared for in the same manner as an acute hospital inpatient, causing unnecessarily high costs and multiple inefficiencies. It is possible, however, to analyze a hospital in order to determine the appropriate size of a closed defined observation unit and to properly equip, staff and implement a model appropriate to the hospital’s needs.
Unit Requirements Analysis
Over 99% of Observation level of care patients enter through the ED. The volume of patients entering the ED that require a hospital stay can vary depending on the institution and the patient acuity. Currently the average “admission” rate through the Emergency Department is 21% [15]. This is the total percent of patients that are deemed ineligible to go home. These patients fall into numerous categories-ICU, Surgical, Medical, Cardiac, OB/GYN, or Pediatrics. This section deals only with the patients falling into the Adult medical category that are currently viewed as potential observation patients. This volume is usually 25%-30% of the ED patients who require hospitalization. Take, for example, an Emergency Department which treats 50,000 cases per year. 10,500 cases (21%) would require a hospital stay. From 2,625 to 3,150 of these cases (25%-30%) would be classified as observation level of care after an initial review. To determine the number of beds required to manage this volume, the following characteristics of an observation bed need to be taken into account.
It has been well established that the average length of stay of an observation patient is approximately 20 h in an efficiently managed, closed observation unit. The standard scatter-bed approach averages 36 h [16]. An observation bed should be occupied 90% of the time throughout the year. This results in 36 days out of 365 that the bed is empty. If the conversion rate (patient converted from observation to inpatient level of care) is 15% for the bed, the bed holds an admitted patient 49 days out of the year if the bed is only tied up for a 24-h period. If the patient remains longer, bed availability obviously decreases. The result: each observation bed is able to circulate 280 patients per year into discharge status. The total patients handled per bed for the year would be 329- This number adds inpatient conversions (49) to discharged observation patients (280). Since the length of stay for inpatient conversions exceeds the average 20 h by about 18 h, the actual patient per bed usage would be reduced 28 days over the year, from 329 to 301. Now compare that number to scatter-bed, which averages Зб-h LOS, managing only 240 patients each year. The closed model produces an increase of 60 patients per bed per year—an enormous capacity boost.
These bed days gained are very significant. The hospital can either use those beds to manage excess volume being cared for in the ED or shrink the organization’s footprint by reducing the overall volume of staffed beds required to manage the hospital’s patient population. The organization benefits financially while patients benefit from better service, less waiting and more appropriate care (Figure 7.3).
For our 50,000 volume ED, we can calculate that approximately 10 beds would be required (3000 divided by 301) to manage observation volume. The next step is to determine where to put them (Figure 7.4).

Figure 7.3 Observation LOS in part driven by a "Closed" observation unit / unit geographically located within on location and restricted to "OBS" only patients.

Figure 7.4 Patient numbers and LOS for OBS patients—Closed versus Scattered Models.