War of Attrition
Turnover rates for hospital jobs reaching crisis proportions, study warns.

From www.modernhealthcare.com
Written by Michael Romano

Hospitals in the U.S., plagued by a nursing shortage of epidemic proportions, may be focusing too much on recruitment and not enough on retention-a lapse that has contributed to disturbing rates of attrition in many types of healthcare jobs.

In fact, one national researcher has found turnover rates for hospital pharmacists, technologists, therapists and educational training positions topped 20% in 2001, about 5 percentage points higher than the average attrition rate for all hospital workers, and about 2 percentage points higher than that of registered nurses.

The study, conducted by DBM, a human resources consulting firm with 200 offices around the world, suggests hospitals must do far more to retain valued employees as they wrestle with an ongoing crisis in attrition.

"The projected workforce shortage, combined with an increased demand for healthcare services, is already at a crisis level," said the study's author, Joan Luciano, a senior managing consultant with DBM. "Hospitals are beginning to implement retention strategies, but this will be an ongoing priority."
Unlike recent highly publicized studies on nursing shortages, Luciano's survey is unique, she said, because it includes turnover rates for a wide variety of hospital workers. It lists attrition rates in 13 jobs, including counselors, secretaries, nonclinical administrators and professional support positions

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The survey, which examined 44 medical and surgical hospitals in the U.S. to obtain voluntary attrition and retention data for 2001, follows another study last year by the University of Pennsylvania that showed one in four nurses intended to quit their jobs within the next year. By 2010, according to the U.S. Bureau of Labor Statistics, the nation will face a deficit of more than 1 million nurses.
What's more, a report released last week by the Oakbrook Terrace, Ill.-based Joint Commission on Accreditation of Healthcare Organizations said more than 126,000 nursing positions remain unfilled. The r eport calls for aggressive efforts to transform workplaces and "give nurses the independence and support they need" to thrive (See related story, p. 20). It calls for increased professional education programs and zero-tolerance policies for abusive behavior by physicians and other healthcare practitioners.

Faced with dire nursing shortages and surveys such as Luciano's, more and more hospitals are recognizing the importance of retention plans. At Norton Healthcare, Louisville, Ky., which operates seven hospitals in the state, the turnover rate has decreased by 40% since 1999, when it reached 34.6%, hospital officials said. The system also recorded a 14% increase in employee satisfaction in 2001, in large part because of improved communications and an expanded professional career incentive program. Last year, Norton awarded nearly $900,000 to 645 nurses who participated in the incentive program.

The hospital, which calls its frontline managers "chief retention officers," also created an internal agency designed to make sure employees have all the flexibility they need in work schedules, among other strategies aimed at keeping workers satisfied with their jobs.
"The industry as a whole is recognizing the importance of this," said Cis Gruebbel, chief nursing officer at 235-bed Norton Audubon Hospital, Louisville, where 112 employees received $132,000 for the career incentive program. "We have focused a lot of our energy on balancing recruitment and retention."

Luciano expressed surprise that many hospitals don't routinely compile such information. And although about 91% of the surveyed hospitals collected annual attrition rates for all jobs, only three out of four calculated annual costs of turnover; 61% of those hospitals did not know what factors were used to determine those costs.

Based on an average hospital salary of $40,000 and the average cost of attrition as a 1.5% multiple of salary, the typical cost of turnover per employee is $60,000, according to Luciano 's study.
"I was struck by the lack of in-depth information hospitals collect," Luciano said. "When I asked for some of this information and found they don't collect it, I was shocked. I was told (by some hospitals) that they could give me overall turnover rates, but nothing on, say, gender. Or particular jobs. We need more specific information."

The report detailed a number of retention strategies considered effective in reducing turnover. The most common included tuition reimbursement and employee recognition programs. Among the most effective were pay increases and other incentives, such as the career enhancement program at Norton Audubon.

"Retention strategies is an area that hasn't been looked at extensively," Luciano said. "Hospitals may be expending resources on putting strategies in across the board, but they might not be using the most effective strategies. Hospitals really need to capture why people are leaving these various functions. If you're going to address the issue of how to retain these workers, you've got to know why they're leaving."

The report found that total attrition rates for male and female employees were similar, with the average turnover rate for men at 15.2%, compared with 14.6% for women. The highest regional attrition rate in the country was in the Southeast-28.2% for men, 24.3% for women. The lowest attrition rate in the country was in the Great Lakes region, with a rate of 11.7% for men and 10.5% for women.

Luciano said she would only be speculating about high turnover rates in some jobs, or the regional disparities in attrition rates, but suggested that the sky-high levels in the Southeast might be due to more intense competition among providers. She said those factors, including specific reasons why these healthcare workers are leaving, warrant further study.