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Feb 2021

Will Travel Nurses Become the Dominant Staffing Model Post-Pandemic?

Organizations in both the private and public sectors made a variety of changes to their operational models in order to stay in business during the pandemic. Work-from-home and flexible hours become the norm while words such as “Zoom,” “telehealth” and “webinar” became part of the daily business vernacular.  

The original idea, of course, was that these operational changes would be temporary. The thinking was that once we got to the other side of the pandemic, people would return to offices, meetings would again be in person and people would flock to their doctors’ offices.

The reality, however, is turning out to be somewhat different since it seems that more than a few of these “just for now” changes are here to stay.  Many employees who may have originally balked at working from home, for example, have now come to like it so much that they are asking employers to allow this flexibility after the pandemic eases. Patients and providers have not only acknowledged the benefits of telehealth and other alternative health delivery systems, but have even embraced them. I would also venture to predict that ongoing professional education will not only continue to use digital platforms but will most likely expand to more patient and community education applications as well.  It’s indeed hard to put the genie back in the bottle.

One operational change for providers necessitated by the pandemic was the increased use of travel nurses, especially those trained and/or experienced in ICU and other specialties required for COVID-19 patient care. 

Administrators had been tapping this pool of nurses more and more in recent years, but the pandemic coupled with an already chronic shortage of nurses have greatly increased their number.  In fact, over the past three years, the number of travel nurses (also sometimes known as registry nurses) has grown from about 31,000 to at least 50,000. 

The pandemic has created not only an enormous demand for these nurses but also sometimes fierce competition across the country. The fees being offered for their services reflect this. In terms of demand, one nurse agency reports an over 200 percent increase in job openings since September 2020.  And according to Kaiser Health News, a recent posting in North Dakota for a travel nurse with experience was offering more than $8,000 a week.  Reports are that some nurse agencies are demanding upwards of $10,000 a week. As expected, these types of pay scales have created enormous pressure on providers to take steps to maintain their staff nurse headcount to ensure continuity and quality of patient care.  If you add in the possibility of leaving a frigid climate to nurse in the Caribbean (with all expenses paid), the allure of being a travel nurse can be almost irresistible. 

Cost and Care Considerations for Providers

Travel nurses are, in the overall history of health care, a very recent development that didn’t necessarily have the most auspicious beginnings.  In fact, I am sure that if you told the city of New Orleans that the contract nurses it hired to help with medical care during the 1978 Mardi Gras would a few decades later be a more than $6.1 billion business, they probably would be understandably shocked. But as the nursing shortage began to impact providers in the 1980s, the idea of travel nurses to help address short-term staff shortages took hold.

It is important to keep in mind that travel nurses were never meant to replace staff nurses per se but rather to give providers additional flexibility in staffing.  The conventional wisdom was that while these nurses were qualified and experienced, they would never take the place of staff nurses. For this reason, the ratio of travel nurses to staff nurses has traditionally been low with travel nurses representing a small percentage of nursing staff.  Many providers also continue to have concerns about the growth in the use of travel nurses in two critical areas that can make or break a hospital.  These are, of course, financial profitability and patient care.  Let’s look at each.

On the surface, it would be more logical to assume that travel nurses, similar to other short-term temporary staff, represent an additional – and unrecoverable – cost to a provider, which in turn may represent reduced profitability.  Travel nurses have hourly rates which may more than double the base hourly direct salary rate of staff nurses. 

The reality, however, is somewhat different.  Providers need to consider that travel nurses usually do not receive any type of benefit such as insurance, vacation, sick time or continuing education which staff nurses receive. But staff nurses asked to cover additional shifts will usually receive some type of overtime or bonus pay which adds to their overall cost.  When all direct and indirect costs are considered, it may turn out that a travel nurse and a staff nurse represent roughly the same cost to a provider. One study, in fact, calculated that a full-time RN has an all-in salary cost that is around $6 an hour more than a travel nurse.  

Another area of concern over travel nurses becoming more of the norm than the exception is their impact on patient care and satisfaction. As with cost concerns, this is also understandable given the importance of both continuity of care and the nurse-patient bond to patient treatment outcomes and satisfaction.  One study on patient mortality conducted at over 600 hospitals and covering over 1 million patients suggested that the use of temporary nurses does not affect patient mortality.  In fact, where travel nurses help ensure an appropriate patient-nurse ratio, it could be argued that they alleviated a staff shortage which could have resulted in reduced mortality. 

It also seems that patients do not really experience any difference in quality of care between staff nurses and travel nurses. In one study of some 400 hospitals, for example, researchers determined that there was little evidence that travel nurses impacted patient satisfaction with such metrics as pain control and communication. 

The Path Forward

While travel nurses have traditionally been considered a staffing resource of “last resort,” providers should consider that in the post-pandemic “new normal,” they could easily come to represent a significant percentage of nursing staff. This is especially true given the anticipated continued shortage of nurses which shows no signs of abating. In fact, the Bureau of Labor Statistics expects nursing job growth of about 12 percent through 2028.  This translates to approximately 200,000 new RN positions that will need to be filled every year through 2026.

The bottom line is that nurses (especially in adequate numbers) are essential for the smooth running of our nation’s healthcare system and they make a significant contribution to the viability and profitability of providers.  Their interactions with patients, and their management of treatment plans, can play a key role in determining such metrics as patient satisfaction, survival and recovery rates, readmissions rates and payor reimbursement levels, all of which directly impact a provider’s operations and balance sheet.  Given their important role, providers should be prepared and open to adapting their staffing models to achieve their financial goals and to meet their commitment to protecting the health of the communities they serve.

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