Here’s the reality: most people in healthcare misunderstand benchmarks. They’re not about trying to outdo the hospital across the street or hit some mythical national average. They’re about helping you focus on what actually matters—improving your own performance, based on your reality. The moment you start using benchmarks as rigid targets, you lose the plot. Benchmarks are tools, not finish lines.
Compare Groups: Get Real About the Numbers
Benchmarks only work if you start with a meaningful comparison. That’s why compare groups exist. These are clusters of hospitals with similar characteristics—bed size, services, case mix, or governance structure (academic, for-profit, not-for-profit). In theory, they level the playing field.
But in practice, even the best compare groups miss details. Take staffing. Is your nurse educator counted in your nursing unit or clinical education? And what about case management? Some hospitals keep case managers in nursing; others have a standalone department. Without adjustments, benchmarks like these are worse than useless—they’re flat-out misleading.
For California hospitals, compare groups are almost always made up of other California facilities. Why? Because no one outside the state has to juggle the circus of Title 22 regulations and OSHPD reporting. It’s a club with strict membership criteria—and if you’re in it, you know the price of admission.
Normalizations: Fixing the Flaws
This is where normalizations come in. They’re the process that makes benchmarks usable by adjusting data to reflect standard definitions. It’s not glamorous, but it’s critical. Here’s how it works:
- Reallocating Staff: If your nursing unit includes a nurse educator, normalizations might
move that role to clinical education for benchmarking purposes. - Adjusting Workload: Behavioral health units often tweak patient acuity numbers to align
with benchmarks. - Tech Adjustments: Facilities using cutting-edge diagnostic tools may need normalization
to match peers relying on older systems.
These adjustments aren’t optional. Without them, your comparisons are apples to oranges, and you’re wasting your time.
California’s Unique Headache
Think running a hospital is hard? Try running one in California. Between Title 22 regulations
demanding strict nurse-to-patient ratios and OSHPD’s exhaustive reporting requirements, you’re dealing with a whole different ballgame. These rules add costs and complexity most other states don ‘t face.
That’s why California hospitals almost always benchmark against each other. It’s not just
practical—it’s necessary. Comparing to out-of-state peers is like asking someone to play by rules they’ve never even heard of. Inside the state, the rules might be tough, but at least they’re the same for everyone.
Stop Misusing Benchmarks
The biggest mistake hospitals make with benchmarks? Treating them like the ultimate answer. Setting budget expectations or performance goals solely to hit a quartile target is lazy leadership. It ignores what really matters: your hospital’s unique context.
Benchmarks are conversation starters, not mandates. They highlight gaps, spark ideas, and show what’s possible. But they can’t dictate your strategy. The real improvement happens when your leaders take ownership of their data, understand their circumstances, and make targeted changes that stick.
How to Use Benchmarks Right
At PERFECTSHIFT, we don’t worship at the altar of benchmarks. We know their value—and their limits. Benchmarks are tools, nothing more. They help you see opportunities and start conversations. But the work of real change? That comes from you.
Our job is to help you make benchmarks work for you. That means:
- Helping you understand your data.
- Identifying gaps that matter.
- Setting goals rooted in your reality.
Benchmarks don’t create change. Leaders do. Your hospital’s success won’t come from copying someone else’s numbers; it’ll come from defining what success means for you and making it happen. Let’s stop chasing someone else’s definition of excellence and start building our own.