Archived Publications Ebook: Using Goal Setting and Performance Manageme

For most healthcare organizations, their greatest expense—and greatest differentiator—is their employees. Numerous studies have shown that a competent, tenured workforce is key to achieving positive outcomes and providing a superior patient experience. Conversely, performance can be jeopardized when employee turnover is high. Yet, turnover rates in the healthcare industry continue to rise, fueling increasing anxiety about the quality of care that is being provided. In this paper, we look at the role compensation can play in supporting employee retention and suggest ways healthcare organizations can use a strong compensation strategy to reduce employee turnover. The Rising Cost of Employee Turnover Compensation Can Influence Turnover Healthcare turnover rates remain high. The turnover for a bedside RN is 14.6% while Certified Nursing Assistant turnover stands at 24.6%. Moreover, the average time to recruit an experienced RN ranges from 55 to 119 days, up from 36 to 97 days in 2014 (Colosi, 2017, p.7). As the following graph indicates, RNs in Surgical Services are the most difficult to recruit, followed closely by Emergency Room RNs. The good news is that there are actions healthcare organizations can take to improve employee turnover, and the incentive to improve is high. At current rates, each percentage drop in RN turnover will save the average hospital $410,500 (Colosi, 2017, p.1). According to a 2017 report by NSI Nursing Solutions, Inc., salary is mentioned as one of the Top 5 Reasons healthcare workers voluntarily resign (Colosi, 2017, p.5). It is ranked fourth, along with: • Personal reasons • Relocation • Career Advancement • Salary • Workload/Staffing ratios Source: SI, Nursing Solutions, Inc., 2017 With the average cost of turnover for a bedside RN ranging from $38,900 to $59,700, they typical hospital is losing $5.13M – $7.86M annually (Colosi, 2017, p.1). These staggering numbers cost the industry billions in hard costs every year in lost productivity, hiring, and training costs—not to mention the indirect effects on quality of care, employee morale, patient experience, increased workloads, etc. This finding is corroborated by a study of healthcare workers conducted by CareerBuilder which indicates 75% of health care workers say they do not earn their desired salary and only 51% of healthcare workers cite Compensation as a reason to stay in their current role (CareerBuilder’s November 2012 survey of more than 570 U.S. health care workers). HealthStream Industry Perspective: 5 Ways Compensation Planning Can Improve Employee Retention HealthStream.com/contact • 800.521.0574 • 23

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