“We had health care workforce shortages well before the pandemic, and now the pandemic has put us over the tipping point.”JOHN HAWKINS, PRESIDENT/CEO OF THE TEXAS HOSPITAL ASSOCIATION
As we move forward, the Texas health care community and the organizations that serve them are focused on answering critical questions. How can hospitals keep their doors open and maintain their high standards of care as federal and state pandemic relief runs out? Is there a long-term remedy to the chronic staffing shortage, particularly related to the direst need: recruiting and training significantly more nurses than we have today?
A Perfect Storm
Like most business challenges, the staffing shortage in Texas hospitals is best considered through the pre-pandemic versus pandemic lenses. Both highlight concerning shortfalls but at very different proportions.
Before COVID-19, Texas hospitals were already fatigued by health care staffing shortages. By 2019, the state’s population was rising more than twice as fast as the national average while the demand for physicians and other health care professionals outpaced availability. The Texas Center for Nursing Workforce Studies (TCNWS) reported vacancy rates for both RNs and LVNs surpassed 5% statewide, while the median turnover rates averaged about 18%-19%. Those shortages were concerning enough to prompt organizations like THA to take action.
“We’ve been working with the Texas Legislature for more than a decade on nursing shortage issues,” said Jennifer Banda, THA senior vice president of advocacy and public policy. THA partners with the Texas Nurses Association on critical workplace issues, including staffing. The partnership led to the development of TCNWS at the Texas Department of State Health Services to serve as a resource for data and research on the nursing workforce.
The pandemic didn’t dampen the appeal of Texas to newcomers flocking to the state. Simultaneously, it altered work conditions at an incredible, unrelenting intensity. While Texas communities continued to grow, COVID-19 hit health care workers with unprecedented pressures. A poll conducted by Kaiser Family Foundation and the Washington Post found that, by the spring of 2021, about three in 10 health care workers considered leaving their profession. More than half claimed burnout as the cause. Once the COVID-19 surge caused by the delta variant peaked in fall of 2021, the writing was on the wall.
“Everybody stepped up at the beginning of the pandemic. But after the prolonged multi-year pandemic, those who were in a position to retire did,” said Brad Holland, CEO of Hendrick Health in Abilene.
“With the omicron surge, we heard story after story of nurses who were either exposed to or had COVID-19, or they were living with family members who had COVID-19. It wasn’t just an issue of the patients being sick. Nurses, support staff and their families were sick, too. It decimated the workforce,” Banda added.
FILLING IN THE GAPS
The leadership at Hendrick Health is proud of the hospital’s reputation as a great place to work.
“Prior to the pandemic, Hendrick’s turnover rates were well below the Texas average of between 16% and 18%, however towards the end of last year, our turnover rate exceeded 25%,” Holland told us. “When you turn over one in four employees, it is bound to have an impact on your quality, your culture, and your ability to recruit qualified applicants.”
A 25% turnover was once considered an outlier metric. But, for the past few months, it’s been fairly standard for nursing jobs in Texas. Hospitals report shortages of respiratory therapists, laboratory technicians, radiology technologists and other health care professionals also hit hard by pandemic pressures. But it’s the nursing shortage that is keeping hospital leadership
up most at night.
In these first two years of the pandemic, facilities deployed temporary solutions to keep hospital floors staffed. Like most hospitals, Hendrick Health relied on a combination of federal, state and private contracting help to supplement their nursing staff as needed.
“By late January 2021, we had labor coming in from the state and about 40 personnel from the U.S. Department of Defense. We also relied on well over 200 contract staffing nurses during this time. It was desperately needed and much appreciated. With their help, we were able to adjust patient care ratios and minimize risks,” said Courtney Head, assistant vice president of Human Resources at Hendrick Health.
These solutions weren’t without drawbacks, though.
“It put additional pressure on our own staff members to orientate new people,” Head added. “We were doing everything we could to get the staff in, get them oriented to our systems, and then onto our floor so that they could provide support.”
All the while, a phenomenon was emerging that would turn out to be a significant threat to the sustainability of staffing nurses moving forward: Nurses were beginning to leave their full-time jobs for contract staffing.
“Contract staffing went from a huge help to a huge problem. Suddenly, nurses on staff at Texas hospitals were receiving texts during their shifts with offers of more than twice their pay and huge signing bonuses if they were willing to fly out to California the next day—or even stay in Texas—to serve as traveling contract nurses. No one can blame nurses for taking advantage of that opportunity.”JENNIFER BANDA, SENIOR VICE PRESIDENT OF ADVOCACY AND PUBLIC POLICY AT THA
Texas hospitals are no strangers to temporary or seasonal staffing shortages requiring reliance on high-cost contract staffing. They also had federal funding to help ease the cost for much of the pandemic. But what started as a temporary solution has turned into a lingering and unsustainable expense. What’s more, while contract nurses do benefit from higher pay, it’s the contract staffing agencies that seem to benefit most.
“Unfortunately, some nurse agencies and other direct care staffing agencies are exploiting the severe workforce shortages during the pandemic by charging uniformly high rates—two or three times pre-pandemic rates—and retaining up to 40% or more of those amounts for themselves,” Rick Pollack, president and CEO of the American Hospital Association, said in a recent statement. “The behavior of some of these staffing agencies suggests widespread coordination and abuse.”
Hospitals like Hendrick Health have tried to compete with the lure of contract staffing or leaving the nursing profession altogether. The task, however, has been practically insurmountable.
The increases in pay and contract labor, retention bonuses, and seasonal pay for staff working extra hours have increased Hendrick’s salary and wages by nearly 25% year-over-year. Their contract labor line item alone is up over $50 million year-over-year, even with less staff.
“Using West Texas terms, COVID-19 has been a dust-up, and now we’re trying to gauge what the situation looks like as the dust settles,” Holland explained. “It appears that we’re at a new cost basis. We’ve been left with higher wages, higher purchased service and supply costs, a permanent nursing shortage, no more COVID-19 relief funds, and no free labor from the state. At the same time, we’re fixed in our revenue stream—private insurance companies and sources like Medicare aren’t increasing what they pay. Every hospital seems to be upside down, and it’s to a staggering degree.”
LOOKING TO THE FUTURE
“Workforce is our No. 1 issue as we make our way through the year and into the next legislative session,” said Hawkins. THA is investigating a combination of immediate and long-term solutions requiring national, state and local actions. At the federal level, the main focus is suspected price gouging. “We’re keeping the pressure on the federal level for relief regarding the staffing agency issue and hope to shed additional light on staffing companies and anti-competitive behavior.”
At the state level, THA has assembled a workforce task force. The group is charged with creating a comprehensive plan, bringing in partners with diverse expertise and perspectives —nurses, physicians, behavioral health specialists and others representing hospitals from across the state—to ensure an integrated advocacy approach.
Part of that plan addresses another factor central to the shortage: replacing the sheer number of nurses who recently retired. AHA states that, by 2017, almost 30% of all nurses nationwide were 60 or older. Federal data showed grim statistics for the nursing industry by the end of 2022: An estimated 500,000 nurses are expected to have left the profession, many of those through retirement, bringing the overall national shortage of nurses to 1.1 million.
“If you take a snapshot of the nursing workforce, with seasoned nurses at the top and new grads at the bottom, the volume historically matched up fairly well. But during the pandemic, if you were nearing retirement age and you had the ability to retire, you did. Those nurses are never coming back. So now that demand is higher than it’s ever been, we have a new and very large void in the workforce that won’t fix itself,” said Holland, who is also a THA board member and co-chair of the subcommittee within the workforce task force that addresses long-term challenges.
A significant conclusion has already emerged: Texas hospitals need to work together with nursing schools to increase admissions and graduations. It’s a task that’s easier said than done. Nursing schools—not just in Texas but nationwide—have turned away qualified applicants for years due to shortages in faculty, classroom space and clinical training sites. TCNWS data shows that in Texas in 2021, 15,700 qualified applicants who applied to nursing schools weren’t accepted.
THA and TNA are working with the Texas Higher Education Coordinating Board to tackle the issue from a funding perspective. Specifically, they’re advocating to help the state’s nursing schools boost enrollments by adding faculty and increasing clinical space for rotations. THA is also visiting with health care leaders, legislators and health care providers around the state to identify advocacy efforts and requests to bring to the state legislature in January 2023.
“I feel strongly that the Texas Legislature and local nursing schools are central to the solution. If we keep doing what we’ve always done, if Texas keeps graduating the same number of nurses we always have, staffing shortages will not be solved.”BRAD HOLLAND, CEO OF HENDRICK HEALTH IN ABILENE
Hendrick Health is wasting no time in being part of that solution.
“We’re fortunate in Abilene that we’re able to work with about seven nursing schools,” Holland explains. “We’ve charged our team to work with each school to see if we can increase nurse throughput by 25%. A major university-run nursing school has already accepted that challenge. Historically, they graduate 150 nurses every year. We’re working with them to add another 75 student slots for the year, increasing capacity by 50%. And that starts now, with the next round of nursing enrollments.”
He points out a significant concern nursing schools have is whether their partnering hospitals have the clinical preceptors and clinical spots to accommodate the increase.
“Hendrick’s answer to these nursing school concerns is we will find them, and I implore all of my hospital colleagues to do the same if we are to ever fix this nursing shortage,” he stated.