Agency staff cost New Jersey hospitals $670M in 2021

New Jersey hospitals more than tripled their 2020 spending on agency and travel staff last year, estimating they spent $670 million, according to a recent survey from the New Jersey Hospital Association.

The association surveyed 70 percent of the state's hospitals in early February to examine their workforce challenges, among them rising staff vacancies and employment costs amid a tight labor market.

Five more survey findings:

1. The vacancy rate for registered nurses — the number of vacant positions relative to the total number of employees — climbed from 8.2 percent in 2020 to 13.4 percent last year, a 64 percent increase.

2. For nurse extenders such as certified nurse aides, the vacancy rate increased from 12.4 percent in 2020 to 16.9 percent last year, a 37 percent increase.

3. Hospitals increased their reliance on agency RNs by 66 percent, from 3.6 percent in 2020 to 6 percent last year.

4. Hospitals increased their reliance on agency nurse extenders by 68 percent, from 2.9 percent in 2020 to 4.9 percent last year.

5. Hospitals spent about $499 million for overtime in 2020 and are projected to have spent about $592 million in 2021.

The survey results are indicative of the national trend of hospitals facing staffing shortages and rising labor costs as they vie for talent. It's a concern the American Hospital Association has urged Congress to address, calling workforce challenges facing hospitals a national emergency.

The New Jersey Hospital Association suggested such long-term strategies as opening more educational opportunities for students interested in healthcare and boosting healthcare faculty to address the workforce challenges.


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