Cohort Turnover and Operational Performance: The July Phenomenon in Teaching Hospitals

by Hummy Song, Robert S. Huckman & Jason R. Barro

Overview — Hummy Song, Robert S. Huckman, and Jason R. Barro study the impacts of the annual July turnover of doctors in teaching hospitals on qualty of care.

Author Abstract

We consider the impact of cohort turnover—the planned simultaneous exit of a large number of experienced employees and a similarly sized entry of new workers—on operational performance in the context of teaching hospitals. Specifically, we examine the impact of the annual July turnover of residents in U.S. teaching hospitals on the average length of hospital stay and mortality rate in teaching hospitals relative to a control group of non-teaching hospitals. Despite the anticipated nature of the cohort turnover and the supervisory structures that exist in teaching hospitals, the annual July turnover of residents results in a longer average length of stay (i.e., increased resource utilization) for both minor and major teaching hospitals and higher mortality rates (i.e., decreased quality) for major teaching hospitals, relative to a control group of non-teaching hospitals. In major teaching hospitals, in particular, we find evidence of an anticipation effect that presents as a gradual decrease in performance beginning several months before the actual cohort turnover. We identify higher overall quality of nursing and increased intensity of potential quality assurance as managerial levers for mitigating this decrease in hospital operational performance.