The nursing shortage has been growing in the United States for many years, but the problem is expected to reach new heights as our population ages and a large portion of nurses approach retirement. This shortage was compounded with the onslaught of the COVID-19 pandemic when staffing needs surged to unprecedented levels, particularly in specialty units.
Maximizing labor efficiencies is one of the hardest yet most critical responsibilities for a CNO or nurse manager. In other words, there is an expectation to meet staffing needs and provide high-quality care while keeping labor costs low, even amid a nursing shortage or pandemic.
Workload balancing is fundamental to hitting those efficiency targets. But making the right choices when it comes to staffing should not be a guessing game. This white paper will examine how poor workload balancing can negatively impact a health system’s bottom line. It will also discuss the need for real-time, enterprise-level data in order to make more informed staffing decisions.
The Costs to Consider
Nursing resources may account for a quarter of a hospital’s total budget, so it’s no wonder costs associated with nurses are often closely scrutinized. There are a number of key factors to consider when analyzing these costs.
To make up for increasing nurse shortages, CNOs and nurse managers will often rely on overtime and pricey supplemental labor to fill in the gaps. In the middle of a busy shift, it’s easy to focus on immediate needs and neglect to take accruing overtime into account. As of May 2019, the median hourly wage for an RN was $37.24. And according to Medscape’s RN/LPN Compensation Report from the same year, 56 percent of the more than 5,000 registered nurses (RNs) surveyed reported working between 1 and 5 hours of overtime per week. That could average out to nearly $9,000 in additional annual wages per nurse. Meanwhile, 45.7 percent of hospitals that participated in the 2020 NSI National Health Care Retention & RN Staffing Report said they wanted to reduce their reliance on supplemental staffing due to the hefty price tag. By eliminating 20 travel RNs, the report says a hospital could save a whopping $1.4 million on average.
Nurse retention is another crucial piece of a health system’s financial puzzle. Studies show that lengthy shifts and mandatory overtime correlate to lower job satisfaction and burnout for nurses, which can result in higher turnover rates. This can be a costly cycle. Turnover for a bedside RN comes at an average cost of $44,400, ranging from $33,300 to $56,000. That adds up to a loss of between $3.6 million and $6.1 million for the average hospital, numbers that should be alarming to any healthcare leader.
While long shifts are shown to have adverse effects on nurse satisfaction, the same is true for patients. Exceptional patient experience is not only one of a hospital’s primary objectives, but the measurement of its success can be incredibly valuable. One analysis of the association between Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) scores and financial performance found that hospitals with HCAHPS patient ratings of “excellent” between 2008 and 2014 had an average net margin of 4.7 percent. Meanwhile, those with ratings of “low” averaged 1.8 percent. In a world of value-based healthcare, HCAHPS scores also bring with them a direct financial impact — for example, hospitals with low scores may be penalized with reduced Medicare reimbursements.
It’s also important to consider the costs associated with scheduling itself. With traditional scheduling methods, it’s easy for CNOs and nurse managers to waste their already scarce time. Filling a last-minute shift might require supervisors to check availability by calling nurses one by one across multiple departments while also looking up competencies and specialties to ensure a nurse is qualified to work in a particular unit. This process can be both time consuming and expensive.
Workload Balancing Requires Informed Decisions
Having the ability to make informed staffing decisions is the key to workload balancing and, in turn, mitigating unnecessary costs. That’s why health systems can’t afford not to use a data-focused workforce scheduling system. Scheduling systems can help reduce overtime and supplemental labor usage, increase retention rates, improve patient experience, and save supervisor time spent filling shifts. Plus, large health systems will benefit from standardizing their scheduling processes for all hospitals and other healthcare facilities.
But all workforce scheduling systems are not created equal. An excellent system puts data right at your fingertips by giving CNOs and nurse managers a bird’s eye view across the entire enterprise. The data should include:
- A complete picture of the number of hours worked by each staff member, including who is in overtime and who has not met their full time equivalent (FTE) requirements
- Productivity and staffing levels of each department
- Credentials of all staff members
With these real-time insights, supervisors are better equipped to make cost-saving decisions. If a department is understaffed, for instance, the supervisor could choose to float a qualified nurse from an overstaffed department who has not met her FTE requirement rather than calling in a nurse who is nearing overtime or an expensive agency nurse. Properly reallocating staff means supervisors are more likely to hit their staffing targets, which means higher staff satisfaction and an improved patient experience. The result? Lower overall costs.
How Can ShiftWizard Help?
ShiftWizard is a workforce management solution that was built by nurses, for nurses. That means the software was designed with workload balancing in mind.
It gives CNOs and nurse managers 24/7 access to the data they need to make smart staffing decisions. The software integrates with all major EMRs, Time & Attendance solutions, and HR and payroll systems, which makes data reporting seamless.
ShiftWizard empowers staff through self-scheduling and streamlines communication between managers and staff. It also features an Enterprise Resource Management (ERM) dashboard to give supervisors an overview of staffing levels and productivity across the entire enterprise. The ERM dashboard allows supervisors to easily configure float pools and adjust shifts with a simple drag-and-drop tool.
ShiftWizard was built to help health systems cut costs through proper workload balancing.
Let the numbers speak for themselves: