Rob Preston | Content Director | March 17, 2023
Healthcare providers are struggling to retain workers at every professional level, with the highest turnover rates among registered nurses, certified nursing assistants, patient care techs, and home health aides. The main reasons for the high turnover—which extends to doctors, physician assistants, therapists, and other frontline workers—include pandemic-related burnout, an aging workforce, and fierce competition to attract qualified people amid an industrywide labor shortage.
Healthcare providers must deploy more thoughtful, creative strategies to retain their people in this highly competitive labor market. If they don’t, the consequences can be dire: Some hospital systems, particularly in remote areas, have been forced to close entire departments and have even gone out of business for lack of qualified medical staff.
However, there is hope. Healthcare providers can start implementing or expanding the seven strategies highlighted here to improve their workforce retention.
Broadly speaking, employee retention—the opposite of employee turnover—refers to an organization’s ability to keep its employees. Employers usually calculate retention rates annually by dividing the number of employees with a year or more of service by the total number of employees at the start of the year and then multiplying that number by 100. Employees who were hired during the year aren’t factored in.
Organizations try to retain their people in numerous ways. Providing competitive pay and benefits is essential, but it’s only the starting point. Other critical retention strategies include fostering a collaborative and supportive work culture, offering training and personalized career guidance, encouraging feedback and addressing employee concerns and needs, offering flexible work schedules and conditions, making employees feel appreciated, and recruiting the right people in the first place.
The root of the healthcare employee retention challenge is scarcity—there are too few medical practitioners and supporting staff to meet existing and anticipated provider and patient needs. This labor shortage, which predates the COVID-19 pandemic, is due to numerous factors, including population growth, changing demographics and disease patterns, insufficient access to quality medical education programs and training facilities, and practitioners retiring faster than HR teams can replace them.
The World Health Organization (PDF) has projected a worldwide shortage of 18 million doctors, nurses, and other frontline healthcare professionals by 2030. And that projection was made before the pandemic, which has exacerbated the shortage as overworked practitioners leave the profession because of burnout. Nearly 340,000 US healthcare professionals left their jobs in 2021, according to a study by healthcare commercial intelligence platform Definitive Healthcare, which also estimates that one in five healthcare professionals have quit their jobs since 2020. The study cites surveys that indicate that almost half of healthcare workers plan to leave their positions by 2025.
Data suggests the employee turnover problem has been getting worse for healthcare providers. A 2021 Advisory Board survey of 224 US hospitals found that turnover of full- and part-time staffers was the highest the firm had recorded in 16 years of benchmarking, with the median turnover rate rising to 18.8% in 2021, up from 15.5% in 2020. And according to the 2022 NSI National Healthcare Retention & RN Staffing Report (PDF), which is based on a survey of 272 US hospitals, the average employee turnover rate at those hospitals in 2021 was 25.9%, 6.4 percentage points higher than the previous year.
To their credit, healthcare providers—supported by the latest technologies—are implementing and honing various programs, policies, and processes as part of their broader efforts to build a work environment and culture where people feel valued and appreciated. Here are seven retention strategies that are making a difference.
Retention starts with recruitment and the ability to identify skilled and talented people likely to fit well into the organization’s culture. Depending on the position, it can cost healthcare providers anywhere from US$3,000 to US$7,000 and take from a few months to nearly a year to fill a vacant position, and those costs don’t factor in the toll on existing staff called on to provide interim coverage. It pays to find people who will produce at a high level and stay for the long term. AI-based HR systems can help organizations identify those people.
Across all industries, nearly a third of new hires quit within the first six months. Top reasons include feeling neglected, overwhelmed, and underappreciated—feelings employers can head off with structured onboarding programs that give new hires the confidence to succeed out of the gate.
At a minimum, onboarding must make it simple for new hires to fill out forms and get trained on systems, policies, and procedures—which is even more important in the highly regulated healthcare industry. A modern human capital management (HCM) system’s interactive digital assistant can help walk new hires through the basics.
Meanwhile, healthcare organizations need to apply a personal touch to help new hires quickly build lasting relationships. This includes assigning each new hire a mentor early on, organizing a tour of the premises and a team lunch on their first day, introducing new employees to colleagues and senior leaders, formally announcing each new hire and providing some fun background information in an organizationwide email, and regularly asking recent hires for feedback on early challenges and celebrating successes.
Forcing healthcare practitioners to log long hours with insufficient help is a recipe for burning them out and losing them to competitors or other professions. Some doctors, nurses, and supporting staff like a fixed, predictable schedule, but for others, a bit of flexibility and variety in when and where they work is welcome. Everyone wants a healthy work-life balance.
Some hospital groups offer their practitioners and support staff nontraditional schedules, including staggered start times and overlapping shifts to help compensate for shortages. They even allow some people to set their own schedules—an option that appeals to younger professionals, those with family responsibilities, and those who want to earn overtime pay.
Some groups have built internal staffing agencies to share practitioners across locations. Novant Health, for example, runs what it calls a “float pool” of a couple of hundred nurses who travel among the system’s 15 hospitals and 360 physician practices across the Carolinas. A major hospital group in India allows radiology, lab, and other specialists to work remotely while creating a hybrid model for others—a model that’s also attractive to young practitioners and those with families.
Here, too, technology can play a major role. The popularity of Zoom and other videoconferencing software makes it easier for practitioners and patients alike to discuss select health matters virtually; it’s also more cost-effective for hospitals and practices and safer for caregivers and patients when dealing with contagious illnesses.
Some hospital systems are exploring putting “virtual nursing” into practice to allow remote staff to handle more of the patient admission workload. In this model, an on-premises floor nurse can perform a physical assessment of the patient, and a remote nurse can update data on allergies, medications, and medical history. Upon the patient’s discharge, the remote nurse can review orders and documentation, deliver education, and check if a pharmacy is documented.
Meanwhile, AI-based workforce-planning applications can help managers predict surges in patient demand and set practitioner schedules accordingly. Northwell Health, one of the large health systems in New York State, used a dashboard on their cloud HCM system to help their chief nursing officers stay abreast of patient inflows, staff recruitment, and resource requirements during the COVID-19 pandemic.
When HR leaders talk about improving employee engagement, they generally focus on steps employers can take to connect with their people on a more personal level and create a sense of loyalty. Alternatively, they talk about improving the employee experience.
Strategies to foster and manage employer-employee connections include providing practitioners and support staff with personalized career guidance based on their unique backgrounds and circumstances. Healthcare employers are also fielding regular employee surveys and encouraging feedback on ways to improve the organization. And they’re connecting caregivers with mental health services—as well as with communities of their peers for advice and support—to avoid burnout. The goal is to create a culture in which employees engage more regularly with their peers and with management, building appreciation and a sense of belonging.
The healthcare profession may be a higher calling for most practitioners, but everyone still wants to be paid what they’re worth, especially given the rigors of the field and the competitive market. Provider HR organizations need to use external benchmarking data to regularly adjust their compensation plans for both medical staffers and contractors.
Complicating matters for the healthcare industry is the fact that costs of all kinds continue to rise—for systems, supplies, malpractice insurance, heating, electricity, and other goods and services—all while the workforce shortage is putting upward pressure on salaries and wages. For example, the price of traveling nurse services tripled during the pandemic and remains relatively high. There’s only so much money to go around, so healthcare providers need to get creative with how they compensate their people.
Financial incentives—in addition to competitive salaries and benefits—include signing and merit bonuses, tuition reimbursements, subsidies for childcare, and student loan repayment programs. Increasingly popular are relative value unit (RVU) plans that compensate physicians, in part, based on their productivity and quality of service.
In the end, the scarcity of healthcare workers creates a vicious circle: Not having enough doctors, nurses, and other practitioners leads to overwork, stress, and burnout, causing people to leave their professions, which further worsens the worker shortage. Unfortunately, there are no easy solutions.
At the hospital and medical practice level, employers need to form partnerships with high schools, universities, training programs, and other institutions to develop and recruit workers at different professional levels.
In the long term, it will take a cooperative public-private sector healthcare Marshall Plan to educate, train, and make available sufficient numbers of qualified professionals. The American Hospital Association has called on US policymakers to lift the cap on Medicare-funded physician residencies, boost support for nursing schools and faculty, and expedite visas for highly trained foreign healthcare workers, among other measures.
Doctors and nurses are burning out and leaving the profession not only because they’re overworked but also because they’re frustrated with the volume of administrative tasks during their days. Doctors in 2021 reported spending on average 15.6 hours per week on paperwork and other administrative tasks, according to a Mobius MD article, citing Medscape’s annual Physician Compensation Report. This paperwork burden has spread more widely across the industry in recent years. In 2018, 70% of physicians said they spend more than 10 hours per week on paperwork and administrative tasks, up from 57% in 2017. In 2014, only one-third of physicians spent 10 hours a week on such tasks.
Part of the problem is that most EHR and other administrative systems don’t communicate with one another. Where possible, healthcare providers need to consolidate systems onto a single provider’s platform and demand interoperability among the systems they buy from different vendors. Meanwhile, AI-based natural language speech recognition software can minimize the time clinicians have to spend completing documentation and other paperwork. “Jumping between disparate platforms—within and outside of clinical workflows—to complete everyday tasks or access information creates friction and negatively impacts provider experiences,” notes Rebecca Laborde, a master principal scientist with Oracle Health.
Healthcare providers’ HR organizations need the right technology to minimize employee turnover and maximize the return on their investments in their people. Central to that strategy is improving the overall employee experience.
Oracle ME, part of the Oracle Fusion Cloud Human Capital Management application suite, is the only end-to-end employee experience platform designed to help healthcare and other professionals build relationships with their peers and managers, weigh in regularly on their challenges and seek answers, grow their careers through personalized guidance, and ultimately thrive in their roles.
Oracle Cloud HCM can also help organizations apply the latest AI-based capabilities to help recruiters find the right people in the first place. These capabilities allow HR to analyze the data shared by applicants or prospects—including their skills, credentials, work history, and interests—and then examine that data against the job requirements and data on the organization’s culture and how recent hires with similar profiles are faring in their roles. This work can help HR filter out candidates likely to reject an offer, as well as identify current employees who know the top candidates and can encourage them to accept an offer.
How can healthcare providers help improve their employee retention rate?
There are no simple solutions, of course, but effective workforce retention starts with improving the processes employers use to recruit, onboard, schedule, engage with, and compensate their people while freeing them up to focus more on patient care and less on administrative tasks.
What is the average annual turnover rate for healthcare providers?
Numbers vary by study. In 2021, turnover rates among hospitals ran in the 19% to 26% range, higher than the average for all employers. Turnover rates are particularly high among registered nurses, certified nursing assistants, patient care techs, and home health aides.
What is retention in healthcare?
Employee retention in healthcare refers to the ability of hospitals, medical practices, clinics, hospices, and other care providers to keep their skilled, talented, and productive doctors, nurses, and other practitioners, as well as supporting staff.