Rising costs, contract work exacerbate nursing shortage for state’s safety net hospital

Published 10:00 am Friday, May 20, 2022

As part of efforts to address a shortage of nurses and respiratory therapists, the University of Mississippi Medical Center (UMMC) hosted a walk-in job fair on Monday.

Pre-pandemic, UMMC would have an average of 30 open nursing positions at a time. That number has ballooned to over 200 over the past few years.

For respiratory therapy, the hospital has 30 open positions in its adult hospital and 20 to 25 openings in its pediatric unit.

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During the five-hour job fair, 16 applicants showed up and 11 were offered jobs on the spot. All accepted their offers.

Patrice Donald, a registered nurse and manager of clinical recruitment and retainment at UMMC, said that the streamlined job fair process cuts down the time from the interview to hiring by around 42 days.

Abigail May of Madison is one of UMMC’s recent hires. May will graduate from UMMC’s nursing school on May 27 and start her new job in the hospital’s neonatal intensive care unit just three days later.

May said that her experience at UMMC, both as a student and a patient, along with the center’s focus on medical research, makes her want to stay in Mississippi.

“I love helping the sickest of the sick patients,” May said. “I feel like that’s definitely my calling.”

Mississippi has lost more than 2,000 nurses over the course of the pandemic due to burnout or higher paying jobs in other states, often in travel nursing. This strain is being felt all across the country, and the national shortage of nurses is likely to get worse over time.

The aging population creates additional challenges:  An older population increases the demand for health care services, while also decreasing the number of working registered nurses as more retire from the workforce.

A new report from the McKinsey consulting firm estimates that the United States may have between 200,000 to 450,000 fewer nurses available than are needed by 2025. The number of nursing school graduates who enter and stay in the workforce would need to more than double every year until 2025 to meet this demand.

Some of the state’s American Rescue Plan Act funding was appropriated to help address this issue, including $40 million for nurse training at colleges and universities and $6 million for forgiving nurses’ student loans.

But the effects of this investment won’t be felt for some time and does nothing for hospitals who need nurses immediately.

“It’s been challenging to recruit to retain, when there are so many travel agencies out there who can offer them a lot more money to leave the state … I’d be lying if I said that I hadn’t gotten an email or phone call asking what my interest is,” Gordon Gartrell, a nurse manager in UMMC’s pediatric intensive care unit, said.

However, UMMC has a competitive advantage over other health care providers in the state, Gartrell said, because it hosts  the state’s only children’s hospital.

Nelson Weichold, UMMC’s chief financial officer, addressed the nursing shortage during a meeting of  the Institutions of Higher Learning’s Health Affairs Committee on Wednesday.

The labor costs for nurses have increased 14% when compared to the averaged revenue generated by all inpatient and outpatient services UMMC provides, according to Weichold.

Weichold also presented data from the health care management consulting firm Kaufman Hall & Associates that showed the dramatic increase in the national average for contract nurse labor costs. Before the coronavirus pandemic, wage rates for contract nurses were almost double those for employed nurses. By March 2022, contract nurses were making nearly four times more than employed nurses.

The increased labor costs, coupled with increased costs for supplies, are “squeezing” hospitals in a way that’s not happening in other industries, Weichold said. Airlines and fast food companies can pass those increased costs directly onto consumers in a way hospitals can’t.

“That’s not happening in the hospital industry, because, remember, we’re not charging customers, we’re charging insurance companies,” Weichold said. “And the insurance companies are very reticent right now to increase hospital payment rates.”

This tension between hospitals and insurance companies has been playing out openly in Mississippi over the past few months due to UMMC’s intense contract dispute with Blue Cross & Blue Shield of Mississippi, the state’s largest private insurer.

UMMC currently has around 3,000 nurses across its system, and around 100 of them are contract workers. Weichold said UMMC is planning on increasing nurse wages further when the hospital can wean itself off contract nurse labor.

Donald said that in addition to their normal nursing duties, the job descriptions for nurses includes the phrase “and all other duties as assigned,” an addition that has helped them stay afloat during the labor shortage. Nurses are often moved around to different units as needed.

“We’ve got nurses floating around everywhere,” Tyler Fitzgerald, a nurse manager in UMMC’s transplant unit, said. “So we’ve managed. It’s been tough at times, and it remains tough, but we’re all here for the same reason.”

During the IHL meeting, Weichold said that the behavior of contract nurses has changed recently. While many were leaving to work in other states early in the pandemic, now they’re leaving a job at one hospital to do contract work at another hospital in the same city. According to Weichold, most UMMC nurses who leave for contract work return to the hospital within three to four months.

Fitzgerald experienced that trend firsthand.

Fitzgerald said his team lost three full-time nurses during the pandemic who have recently returned to UMMC.

“We have people that leave and then come back,” Fitzgerald said. “Everybody always comes home.”