Contract labor costs may be in decline, but are system leaders doing enough to retain nurses?

Health systems are happy to point out how their contract labor costs are declining significantly from COVID-19 highs as results season gets into full swing. At the same time, the phrase "national labor shortage" is often in accompanying sentences.

Right now, there are about 5 million nurses in the U.S., an all-time high, Rebecca Love, MSN, RN, nursing advocate and chief clinical officer at nursing agency IntelyCare, told Becker's in a recent interview. The problem, therefore, is not recruiting but retention of such staff, she says.

When about half of new nurses have side hustles to earn much-needed extra income and plan to make such hustles an eventual full-time position, such claims bear scrutiny.

Some healthcare executives indeed appear to be attacking the root cause of such labor problems far more than others, executives point out.

Winchester, Kan.-based F.W. Huston Medical Center, for example, has raised its 401(k) match and expanded tuition assistance for its nursing staff, said interim CEO Paula Ellis, DNP.

"Our critical access hospital leadership is focusing primarily on managing labor costs by shining the light on retention efforts," she previously told Becker's. "We believe the best method to manage labor costs is to retain staff."

Others back her comments.

"Ultimately, we see stabilizing our workforce and reducing turnover through retaining strong members of our clinical and operational team as the key to effectively managing labor costs in this new era of healthcare," Kyle Kramer, CEO of Putnam, Conn.-based Day Kimball Health has previously told Becker's.

Nursing executives point out that large numbers of staff are leaving the profession because of poor retention performance by health systems.

"The challenges of the last few years have seen nurses leaving the profession in droves and taking their knowledge and experience with them," June Altaras, RN, chief quality, safety and nursing officer at Tacoma, Wash.-based MultiCare Health told Becker's. "There are national studies that claim we'll need 1.3 million more nurses by 2030. The math just doesn't add up."

Executives getting excited about what AI and technology can do to reduce costs is all very well, but the constant focus on the financial bottom line has failed to look after what every system claims is its main asset: its people, Paul Keckley, PhD, said in his July 17 report.

"Platform solutions and AI-enabled workforce re-engineering will not be effective until boards and senior management teams undergo heart transplants," he said in the report.

AI, for example, should be seen as a tool to help manage time and costs but cannot come at the expense of people serving on the front line of healthcare, added David Lubarsky, MD, CEO of Sacramento-based UC Davis Health.

"Real compassion still only comes from humans, and compassion remains the strongest medicine," he has told Becker's.

All health systems have to focus far more on their main mission of providing care, and looking after their front-line staff is a key way to do so.

"Speaking to CEOs in particular, I would advise that it is vital they fully understand the value and contributions of nursing in the broader context of delivering care and that financial and care delivery models should support nurses working at the top of their license," said Maddy Pearson, DNP, RN, chief nursing officer at Brigham and Women's Hospital in Boston.


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