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CHAPTER VII Improving the Use of Nursing Resources Prompted by a concern that the working conditions of many nurses were driving them out of the profession, or at least out of certain health care settings, Congress asked this study to suggest actions that would encourage retention of nurses. In its review of possible reasons for nurses leaving their jobs, the committee found that management decisions strongly influence the supply of and demand for nurses. Such decisions are major determinants of whether a nurse can expect opportunities for career advancement, and whether the work environment can accommodate the demands of nursing responsibilities In light of its charge to determine the future need for nurses, the committee was concerned that hospitals might not be doing all they could to maximize the use of the existing supply. The emphasis in this chapter primarily is on hospitals, the largest employment setting. Because nursing homes and same kinds of hospitals--particularly those located in inner cities and rural areas--face the fundamental financing and other constraints described in the previous chapter, their flexibility in implementing innovations is severely hampered. Nevertheless, they may find the discussion helpful. i The Effects of Management Decisions on Supply and Demand The decisions health care institutions make about the nature and volume of their services shape the demand for nurses. These decisions are influenced by technology development, the flow of reimbursement dollars, consumer demand, and the exercise of professional prerogatives in the practice of medicine and nursing. To illustrate, the decisions of many hospitals to open or expand intensive care units, which have high nurse staffing requirements, greatly increased the overall demand for nurses during the 1970s. Planning of future needs for nurses requires consideration of the variety of skills and knowledge that should be represented in the nurse supply. We have observed that many hospitals appear to be moving gradually toward a greater proportion of registered nurses (RNs) in relation to other types of nursing service personnel (see Chapter II, Table 10) and that the nation's supply of RNs with 190
191 baccalaureate and advanced degrees is gradually increasing. These developments, coupled with the trend toward educational advancement and recruitment into nursing schools of nontraditional students with a variety of educational and experiential backgrounds, suggest that employers face ever more complex personnel and staffing decisions. In establishing policies that take into account the growing specialization and differentiation among various nursing roles, employers have an important share of the responsibility for creating career opportunities and policies encouraging educational advancement that could be important in keeping nurses in the labor force. Employers also have a strong influence in whether nursing is viewed by potential candidates as a desirable lifetime career. Because financial constraints probably will limit expansion of nursing education during the remainder of the 1980s, managers must examine how to adapt to local supply conditions without simply calling for additional education slots. This may mean developing strategies to increase the number of hours that part-time nurses work, encouraging inactive nurses to reenter the field, adjusting staffing patterns to make more effective use of current staff, or reducing excessive turnover. By directing this study to develop recommendations to encourage nurses to remain in or reenter the nursing profession, "including actions involving practice settings conducive to the retention of nurses," the congressional mandate clearly broadened the audience for this report to include not only federal and state governments but also the private sector. Many remedial actions can be carried out only by those who set organizational, management, and personnel policies in hospitals, nursing homes, health maintenance organizations, public health departments, and all other agencies that employ nurses. The activity of the National Commission on Nursing between 1981 and 1983, with its broad representation of health care industry and professional leaders, indicates a heightened awareness among national health organizations of their responsibilities to provide leadership in solving the problems of nursing and nursing education. There is no lack of examples of individual institutional innovations to be explored; the question now is what kind of supporting groundwork must be laid to ensure that important issues remain on the agenda and workable ideas are widely disseminated.] Job Turnover and Attrition in Nursing It has been commonly accepted that job dissatisfaction among nurses has resulted in large numbers leaving the profession. It is also asserted that many nurses change jobs frequently, causing excessive turnover in hospitals. Recent national aggregate data do not support these generalizations. Although approximately 388,000 RNs are not now employed in nursing--about 24 percent of the total 1.6 million licensed RNs--they appear to have dropped out largely for family or other personal reasons, not because of dissatisfaction with their profession. Figure
192 14 depicts the composition of the pool of inactive nurses. Many of those not employed nor seeking employment appear to have concentrated on raising families or to have retired because of age. Less than 5 percent of the total supply of RNs who are working are employed outside the health field.2 Turnover rates, indicating attrition from a particular place of employment, are lower now than they have been in the past. Early studies of nonfederal general hospitals in 1954 and 1962 found RN turnover rates to average 50 percent (a level 3 times that of teachers and 1.5 tomes that of social workers during the same period).3 Recent studies estimate that by 1982 the turnover rate had on average fallen to between 20 and 30 percent per annum for full-time RN staff.4,5,6,7 For the average RN today, turnover rates do not appear to be any higher than for women in many other occupations. Among all working women, the average tenure per job in 1978 was about the same in the health industry (2.7 years) as in all industries (2.6 years). It was even higher (3.5 years) among professional women in health (presumably mostly nurses) than for women in the nonprofessional occupations (1.6 years).8 Nurse recruiters from more than 400 hospitals responding to the annual surveys of the National Association of Nurse Recruiters (NANR) / Employed in ~ Non-nursing F laid / 69,185 | Seeking Nursing l Employment 32,784 | 60 Years Old \ ~and Over ~ \ Less Th ;= 40 Years Old ~I 94,394 Ma tried With Children ~ Under 6 Years Old ,' - \ 60,322 ,' ~<~c`\ \ " 44a rr' ~40 to 49 I ma> Years Old ' / / 44,479 50 to 59 '` / / Years Old by / 55,397 / \ / ~ 50 and Over 14 1 ,220 / . .... . Not Employed ~ and Not Seeking / Employment 216,568a FIGURE 14 Characteristics of registered nurses not employed in nursing, November 1980. SOURCE: From DHHS, HRA. The registered nurse population, an overview. From national sample survey of . . . . _ registered nurses, November_1980. Chart 2, p. 7.
193 report a steady 3-year decline in annual turnover rates: 30 percent in 1980, 27 percent in 1981, and 23 percent in 1982. These self- selected hospitals may be ones with the most difficult recruitment and/or turnover problems, and thus cannot be said to represent a reliable sample of the nation's community hospitals. They nonetheless constitute a sizable group, and they spend an average of almost $100,000 per year on recruitment.9 A trend of moderating turnover seems to be confirmed by information from several states. A Maryland Hospital Association survey, for example, shows a drop in turnover of 12 percent over 2 years in the Washington, D.C., metropolitan area, from 36 percent in 1980 to 20 percent in 1982.1O Recent reports from California indicate a turnover rate in 1981 of 37 percent, apparently higher than the national average, but nonetheless the lowest in the state since 1977.11 In North Carolina, hospital turnover rates declined from 23.2 percent in 1980 to 22.1 percent by September 1982.12 Although poor retention and high turnover in nursing may be less severe than commonly believed, the committee concludes that serious problems exist in the management of nurse resources. National data may mask the problems of individual localities and health care institutions. These problems possibly could be relieved by attention to basic human resource management principles that often are absent from nurse employment and that hamper quality of patient care, productivity, and the attractiveness of nursing as a profession. The exact reasons for the lessening of nurse turnover rates are unknown. The state of the economy may contribute to it, as may improved management practices in some segments of the hospital industry. In any case, the average turnover rate for hospital staff nurses now appears to be approaching those of non-manufacturing and nonbusiness industries (tax exempt organizations and government agencies), which have average monthly rates of about 2 percent, or an estimated 24 percent annually.13 Nothwithstanding these indications of improvement, the committee views turnover as a continuing problem. First, it is difficult to determine whether turnover will continue at current rates once the economy begins to improve and the general reluctance to change employers during a recession dissipates. Second, the costs of turnover to hospitals can be appreciable in terms of the loss of investments in orientation and recruitment, because substantial costs are associated even with a relatively low turnover rate. The American Hospital Association (AMA) estimates that the median yearly costs of recruiting a staff nurse are $526, plus $1,300 for orientation.l4 These costs mount considerably when they are multiplied by the numbers of nurses that must be replaced when turnover is high. Although the costs of avoiding turnover by paying higher salaries can at times outweigh marginal investments in reducing turnover rates for a hospital, it is difficult to quantify the effect of excessive turnover on quality of care. For example, the resignation of one experienced surgical nurse can seriously diminish the safety and effectiveness of an entire surgical unit. In light of the changing case mix, intensity of service, and growing complexity of hospital
194 organization, managers must learn to recognize, as many successful business enterprises do, the value of experience and thus the importance of low turnover. Researchers interested in developing a causal model of professional turnover have recently focused their attention on nurses.l5,l6 At this stage, the research points to the need for managers to examine more closely their policies with respect to opportunities for continuing education, career advancement, staff assignments, channels of employee communication, workload, and organizational characteristics. All of these factors can affect nurses' perceptions of autonomy and appropriate collegial working relationships with physicians and other hospital personnel. The importance of these factors also was apparent in testimony and anecdotal evidence received at both the open meeting of this Institute of Medicine committee and the regional hearings of the National Commission on Nursing. Many nurses described a variety of work-related frustrations that affect their attitudes toward their work. Even when they do not result in turnover, high-quality patient care and optimum productivity cannot be achieved if nurses are discontented. Other than for newly licensed nurses, there are no national survey data to delineate the important qualitative aspects of nurses' professional and role dissatisfaction, its nature, and its extent. Available studies often are limited to particular geographic areas, and many have insufficient response rates. Nonetheless, these studies are useful in that they suggest the types of frustration many nurses experience in their work situations. A review of recent surveys identified factors most frequently cited by nurses: attitude and behavior of nursing managers; limited professional growth, advancement, achievement, and intellectual environment of the practice setting; salaries; schedules; relationships with other nurses; and working conditions characterized by understaffing, lack of recognition, too much paperwork, poor relationships with physicians, an oppressive organizational hierarchy, and little job security.17 In her critical review of the literature on nursing job satisfaction conducted for the study, Stuart notes that every major study of this issue since the 1960s has pointed to the factors of autonomy, interpersonal relations, and job status as critical components of overall job satisfaction.* Data on newly licensed RNs, however, indicate that there is no widespread job dissatisfaction among these younger nurses. In 1980, among 47,143 newly licensed RNs who reported to the National League for Nursing annual survey 6 months after initial licensure, 82 percent said they were satisfied and 81 percent believed their skills were adequately utilized. These responses varied only slightly according to the type of educational program in which the respondents had been prepared, and by geographic region.l9 In a study of turnover, * For detailed discussion, see Ge We Stuart e Nursing role satisfactions Background paperers
195 Weisman similarly found that younger nurses in their first year of employment were less likely to resign than midcareer nurses. She concluded that these more experienced nurses might be persuaded to remain if they had greater promotional opportunities and salary increases.20 Improving Career Opportunities and Working Conditions Although this study committee cannot find convincing evidence to support the perception that the retention of nurses in the profession or the high turnover rate are problems beyond remediation by the industry, there nonetheless are problems of national importance in the work environment and lack of career opportunities of many nurses. These problems, whether or not they lead directly to high turnover and dropout rates, contribute to the inefficient utilization of the nurse supply and diminish the attractiveness of the nursing profession. Hospitals in the forefront of change are beginning to respond to nurses' aspirations and the increasing diversity and differentiation of their jobs.21 However, in general, career opportunities, salary structure, and work environment for nurses are slow to change. This committee believes it is not in a position to draw conclusions about the relative emphases the industry should place on the criteria of educational credentials, performance, length of experience, and special talents in assigning nursing job responsibilities or making promotions. Even if the research evidence were more convincing than it is at present, the nursing profession and employers of nurses have the primary responsibility to develop staffing standards and implement organizational changes. There are three problem areas that employers cannot afford to ignore: (1) lack of opportunities for clinical career progression with differential salaries and responsibilities, (2) relatively low salaries except at entry levels, and (3) working environments that limit participation in patient care and institutional decision making and that are characterized by poor interprofessional relationships. Lack of Opportunities for Career Progression Many nurses have had little to lose by changing jobs frequently or by dropping out of work for periods of time, because rewards for continuous job tenure, especially in clinical nursing, appear to be minimal. Multiple regression analysis of data from the National Sample Survey of Registered Nurses, November 1980, confirms the perception that employers do not pay a premium for experience (Appendix 7~. RNs employed full time received on the average only about $140 per year for each year of additional experience (controlling for other variables including educational background, job position, geographic region, race, and sex). However, again holding other variables constant, attaining a graduate degree or pursuing a career path in
196 administration does lead to significant salary differences--average annual salaries are about $2~200 and $6,500 higher, respectively. Also, the rapidly growing number of nurses with positions as clinical specialists are being rewarded with high salaries; controlling for educational background, experience, and other variables, the clinical specialist title is on average worth an additional $3,500 per year. These determinants of wage differences among nurses with different characteristics are germane to this discussion, but the variables included in the 1980 National Sample Survey do not account for most of the variation among nurse salaries. Other factors, such as the condition of local labor markets and detailed characteristics of employers not revealed by the broad categories of the survey, may explain why same nurses earn more than others. Too many institutions still view nurses primarily as "job fillers." However, although some nurses may only want jobs, many want careers. Friss identifies three groups of nurses in hospitals. The first, or core group, are committed careerists for whom managers must design an incentive structure that takes into account long-term needs for earnings, tenure, and professional stimulation. The second group consists primarily of part-time nurses who often are perceived as unmotivated transients, but may also be viewed as career negotiators seeking to achieve balance among competing demands in their lives. A third group are potential careerists who may benefit from learning about existing career paths or training opportunities.22 Career-oriented nurses present difficult challenges to health care managers but important opportunities as well. They demand educational opportunity for professional advancement and more authority to make decisions about patient care, to develop their own operating policies, and to influence the larger institutional resource allocation decisions that ultimately affect nursing practice. Health care executives should not respond to these pressures merely to pacify nurses on the staff but should take the opportunity to create nursing service departments that reflect the differentiated responsibilities and expertise inherent in managing what sometimes are multimillion dollar nursing enterprises that deliver an impressively wide range of services. The matching of varieties of expertise to specific jobs in a large health care facility is not easy. It begins with an institutional commitment to incorporate nurses into the senior executive team and continues down the supervisory ladder with nurses who can manage staff effectively. Advanced clinical knowledge is required to manage differing patient needs in most average-sized hospitals. A new combination of management and clinical talents is required to assure accountability for patient care and warrants recognition with new rewards along clinical as well as administrative paths. In many areas, such as long-te`-~ care, opportunities exist for members of the nursing profession to take administrative as well as professional leadership. In summary, nurses, like everyone else, prefer to work in well managed, fairly predictable environments where they know they can advance in their careers and feel that their professional skills
197 contribute significantly to the institution's mission. By providing an environment where this sense of career can be developed, employers will benefit in the long run. A certain amount of turnover is inevitable, because not all nurses are interested in long-term career progression. However, the committee strongly believes that a cadre of well-qualified nurses committed to institutional objectives can help to improve productivity and quality of care. Employers are experimenting with a number of techniques to engage and retain career nurses in addition to the salary changes discussed in the following sections. One set of strategies involves restructuring the workplace, not only in schedules and incentives to work less popular shifts or positions, but also in reorganizing the delivery of nursing services in the institution so that patient needs based on severity of conditions are more closely matched to the ability level of the staff. A second set of strategies is to improve interprofessional relationships. The place of nursing in the management structure can be given a larger voice in resource allocation decisions and in setting hospital policies and procedures. Restructuring in some institutions has decentralized authority and accountability in order to free nurses to have greater autonomy in fulfilling patient needs. Also, attention has been given to physician-nurse relationships both to discover approaches to reducing conflicts and, more positively, to develop collaborative approaches to patient care.23 Finally, there appears to be an interest in sorting out functional relationships with other hospital workers--nursing assistants, unit clerks, pharmacists, and technicians--to differentiate more clearly the scope of nursing's contribution so that nurses can be employed efficiently. A third set of strategies is a retention-oriented approach to recruitment that seeks to develop for the nurse a commitment to the institution as well as a career in nursing. Whether a new or an experienced RN is being recruited, opportunities that will enhance clinical expertise and develop other nursing interests could be effective. Management can help RNs realize their short- and long-term professional goals and develop their institutional loyality by assessing each nurse's capabilities, employing them appropriately, and developing individually tailored plans for educational and experiential opportunities. This may include helping nurses with financial support and released time to pursue continuing, certificate, and graduate education. These nurses can also be enlisted by the hospital as an educational resource to stimulate and act as mentors to less experienced nurses. Salary Between 1972 and 1981, earnings of general staff nurses in hospitals did not keep pace with inflation. In real terms (adjusted for changes in the cost of living), salaries declined at an average rate of almost 1 percent per year over the 9 years. The rate was not constant, however. From 1972 to 1975, real earnings declined by 4
198 percent; between 1975 and 1978 the decline was only 1.6 percent, but steepened to 2.1 percent from 1978 to 1981.24,25,26 For example, between 1978-1981, although nurses' salaries in dollars increased by 35 percent, their real earnings (i.e., purchasing power) decreased.27 However, nurses' earnings grew slightly more rapidly between 1978 and 1981 than the salaries of other hospital employees (Table 30~. Table 31 illustrates that staff nurses have improved their salary position in relation to most other hospital workers, but remain below electricians, social workers, and pharmacists. Over this period, nurses in administrative positions have made minimal gains relative to the staff nurses they supervise. Observers also have questioned the extent to which nurses' salaries fully reflect education, responsibility, and work environment.28,29 In 1978, general staff nurses working in hospitals earned approximately the same amount per year (814,270) as did school teachers ($14,200~; about $4,000 per year more than all female professional, technical, and kindred workers; and about $1,200 per year more than production workers in manufacturing industries.30~31 In general, earnings in occupations with a large number of women are lower than in occupations whose incumbents have similar educational backgrounds and age distributions, but who usually are men.32~33 Data from the 1970 census showed that RNs who worked full tome earned $5,603; a person with equivalent educational attainment and median age in a comparable occupation--mathematical technician, in which 95 percent of employees are men--had earnings of $10,331.34 In 1981, RNs ranked 15 among the 20 occupations with the highest median earnings for women employed full time. RN earnings of $331 per week followed the highest earners, operations researchers ($422), computer systems analysts ($420), and lawyers ($407~--all of whom lagged behind the top 20 male-dominated occupations.35 Recent court cases have raised the issue of equal pay for comparable work. One of these cases involved nurses employed by the city of Denver who brought a lawsuit under Title VII of the Civil Rights Act alleging that male-d~minated professional occupations were classified separately from nonprofessional positions, the result being ~ n determining how wages or compensation were classified together regardless of training, . This case was lost, but the issue of equal discrimination by sex paid. Nurses were all education and Practice pay for comparable work remains alive.36 Although this discussion does not prove that nurses are underpaid, the question remains whether they receive fair remuneration, and whether nursing will be able to continue to attract enough qualified new members to the profession. Work Environment Surveys over the years have identified many reasons for discontent among nurses, often involving features of the nurse's work environment--internal relationships, scheduling problems, and physical
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201 aspects of the work setting.37 Without belittling these factors, attention should also be paid to more fundamental problems. Aydelotte identifies the basic need for organizational rearrangements both at the nursing department level and at the institutional level. She observes that the purpose of change within the nursing department should be to Improve nurse-to-nurse relationships, nursing image, and the nurse's own feelings about work and its organization and her own self worth. At the institutional level, the purposes of change are to enhance communication, to bring many points of view to bear on problems, to integrate a wider set of opinions and knowledge on problems, and to utilize the expertise that nurses have to offer.38 There is, therefore, a need to develop the capacity of health care institutions and nurses to address issues in a mutually satisfactory manner. It must be recognized that some characteristics of nursing, particularly in hospitals, are inherently difficult. These include the close working proximity of occupations that have conflicting professional norms and perceptions, the requirements of 24-hour coverage, services entailing life-and-death decision making, and the complicated regulatory and financial pressures that shape institutional resource allocation. These problems are manifest in different degrees in different institutions as well as different units of the same facility. A challenge to managers is to reconcile the concerns of nurses fairly with the realities of providing hospital services within the limits of resources. In some instances, this reconciliation process may be forcefully placed on management's agenda by nurses' organizing into a union, which has been described as a response to their "inability to communicate with management and their perception of authoritarian behavior on the part of management."39 In other instances, hospitals have created structures that enhance employee management principles of communication and a sense of participation in the decisions that affect the nurse's daily worklife. The work environment has been referred to consistently throughout this chapter as a key factor in whether nurses remain in a particular facility or in the practice of nursing. Although the focus has been on the RN and to a lesser extent the LPN, a small but growing body of labor union literature suggests that the problems identified and voiced by the RN population are echoed among all levels of nursing and ancillary personnel. Sexton has identified "eleven S's" in her analysis of work-related issues affecting nonprofessional personnel. The issues repeat those identified for RNs: security, staffing (and speed-up), scheduling, stress, safety, sick-time, sexism (and segregation), step-up (promotion and upgrading), supervision, schooling, and speaking out. The issues identified, except for sexism, are those common to any labor movement. What this suggests, however, is that unless management deals with the issues in a way that is perceived as responsive to the employees' needs, union activity may increase as it did in industry when management was seen as unresponsive. Women have not historically been readily organized, but societal changes and a push to the health care industry by organized labor may change the
202 character of management/labor relations in the 1980s, and subsequently the supply and utilization of RNs and all other health care manpower.40 In summary, the problem of the work environment is not simply a collection of static grievances, nor is it any one characteristic of the work situation, such as lack of autonomy. These are aspects of the larger problem of nurses who are inadequately prepared to function in bureaucratic organizations that are themselves not structured to cope adequately with a cadre of professional employees performing under a variety of stressful conditions. Inactive and Part-Time Nurses Over the past two decades certain geographic areas, certain segments of the health care industry, and many health care institutions have had difficulties in at trac t ing and retaining nurses. Others have not experienced such problems. Over this same period there have been wide swings in the general perception of national availability of nurses. Even during the course of this study, the labor market outlook in some areas has changed dramatically from one of severe nurse shortage to licensed nurses having difficulty finding jobs. In times of perceived widespread shortage, the health industry has focused its attention on the capacity of the educational sector to produce greater numbers of nurses. Depending on particular local circumstances, new investments in nursing education may be warranted; however, new graduates are not the only means of increasing the effective supply of nurses. Even though labor force participation rates for nurses are generally high, hospitals and other employers experiencing chronic shortages may not be taking full advantage of various techniques to make better use of the number of nurses in the existing supply. Part-t ime nurse s can be encouraged to work addit tonal hours, and inactive nurses can be persuaded to return as part- or full-time employees . There has been a fai lure on the part of many health care facilities to diagnose correctly the causes of their specif ic vacancies and to select the appropriate remedies. Generally, this requires addressing some common barriers to greater participation of nurses in the labor force, including nurses' family responsibilities, lack of suff icient economic rewards, lack of suff icient noneconomic rewards, and out-of-date knowledge and skills of nurses who have been inac t ive . The committee does not wish to suggest that part-time work is dysfunctional in itself; in fact, it meets the needs of many nurses and employers alike. However, when the labor force is not sufficient, it may be the fault of employer practices that discourage nurses who might otherwi se work more e A higher proportion of licensed KNs work than do women in general (and that proport ion increased from 70 percent in 1977 to 76 e 4 percent in 1980), but one-third of licensed RNs work only part time and there
203 is a pool of 388,000 inactive KNs. Figure 14, presented earlier, depicts the composition of this inactive pool with regard to age, marital status, and presence of children in the home. Among LPNs, the most recent inventory (1974) revealed that 76 percent were employed in nursing.41 In a survey of more than S,000 nurses in six states, Feldbaum examined self-reported longitudinal information on labor force participation. The median age of the nurses in her sample was 43 years. More than half of the respondents (56.4 percent) had been employed as RNs for over 75 percent of the years since their graduation; only 7 percent worked 25 percent or less of their careers. Forty-two percent had no career interruptions. Almost 65 percent spent more than half of their careers working full time. Few nurses had been perennial part-time employees. Only about 7 percent spent more than half their work life in part-time employment. In general, as noted in the previous chapter, black nurses had more continuous and full-time labor force participation than white nurseS.42 Roughly one-sixth of inactive RNs--a total of 60,000--had children under 6 years of age present in the home. In addition, there are at least twice that number of married RNs who have children and work part time.43 To the extent that these family responsibilities act as a barrier to entering the labor force or increasing hours worked, this pool of nurses may respond to child care incentives. Another large segment of the inactive RN pool (25 percent) in 1980 was nurses between the ages of 40 and 60.44 This group conceivably could constitute another potential source of increased supply. The extent of influence of young children on a nurse's labor force participation could be overstated unless other variables are taken into account. Therefore we performed a multivariate analysis of data from the National Sample Survey of Registered Nurses, November 1980, to measure the effect of the presence of children in the home, controlling for educational background, marital status, student status, sex, race, age, geographic region and length of experience (Appendix 7~. The analysis revealed that the presence of children under six significantly reduces the probability of a nurse's working full time and substantially increases the probability of her working part tome or not working. This analysis also confirmed the influence of age in nurses' labor force behavior. Irrespective of educational background, race, sex, geographic region, and length of experience, the older the nurse, the greater the likelihood of being inactive. However, it is important to note that nurses with more than 10 years of work experience, regardless of age, are much more likely to be in the labor force today, and working full time. Therefore policies that encourage continuous attachment to the labor force by younger nurses, albeit on a part-time basis, would enhance the likelihood of their working full time in later years. A nurse's decision to reenter the labor force or to move from part-time toward full-time work is strongly affected by considerations of salary and benefit structure. The perception that these factors
204 are important is widespread and has encouraged responses by some employers.45~46~47 For example, some employers have taken into account the problem of overlapping fringe benefits in dual-earner families (over 70 percent of nurses are married) by allowing nurses to choose cash or selected benefits. Indicative of both nurses' and employers' interests in seeking new hiring arrangements is the growth of temporary service agencies, which now appear to have peaked at placing about 37,000 nurses.48 Through these organizations, nurses can earn higher salaries, choose their schedules, and not be subjected to the organizational stresses imposed on a permanent employee in a particular hospital or on a particular floor. Hospitals use temporary service agencies to put nurses in hard-to-fill positions, temporarily paying a higher wage but avoiding salary increases to permanent employees; to circumvent personnel freezes; to adjust staff size to occupancy levels; and to make up for planned and unplanned absences of the permanent staff.49 Whatever the merits or disadvantages of temporary agencies, concern about their overuse and their costs has led to other arrangements. Some hospitals have developed flexible work arrangements that resemble in-house temporary agencies. In these, part-time nurses can work as regular employees of the same hospital on an on-call basis or in a "float" pool, and full-time employees can increase their earnings by moonlighting at their own hospital rather than through an agency. A further barrier to reentry into the nursing labor force is out-of-date knowledge and skills. This problem increases with the amount of time away from nursing. Feldbaum reports that when nurses in her survey left the labor force, most of them remained out for 5 to 5 1/2 years, generally during the time they rear children to school age.50 The more rapidly health care technology changes, the more difficult it will be for many inactive nurses to remain current with the advances in their profession. Hunt found that middle-aged RNs returning to work after childrearing were likely not to accept the challenge of hospital employment. However, he estimated that the probability of working in a nursing home increased about eightfold with the accumulation of 20 years out of the labor force.51 An insufficient aggregate supply of nurses is not at the heart of many employers' problems; rather some nurses are unwilling to work on particular shortage shifts and units under the conditions currently offered them. Clearly, paying the shift differentials sufficient to fill these vacancies may require hospitals and their boards to determine whether they wish to make the necessary trade-offs. Ultimately employers must bear a large part of the responsibility for meeting their own nursing service needs. Historical trends favor the improved utilization of the existing supply. Labor force participation by RNs has been steadily improving. In 1949 only 59.3 percent of the total RN population was employed in nursing; the rate rose to 67.5 percent in 1966 and 76.4 percent in 1980~52 Also, the average number of hours RNs worked per week rose slightly between 1977 and 1980, both for full-t~me and part-time nurses.53
205 Although it is difficult to distinguish the contributions of management practices to these trends of chanting Professional. economic, and social values, the committee actions offer the greatest possibility for _ ~ i__ staffs. The specific measures listed below merit serious consideration, especially by those health care institutions with severe recruitment and retention problems: believes that employers' maintaining adeanate nurse · child care facilities and arrangments for the care of other dependents, especially during hours when private care is difficult, such as nights and weekends · work schedules adapted to the personal needs of nursing staff · improved salary structures in the context of an overall strategy to improve productivity and rationalize the use of the hospital's nursing resources · fringe benefit options so that nurses can select those most appropriate to their needs · special educational opportunities for nurses wishing to prepare themselves for reentry into active practice. After reviewing numerous published descriptions of innovative projects that health care institutions have undertaken, the committee believes that the kinds of actions listed above hold the greatest promise for enhancing labor force participation. This does not signify that there are no other useful incentives available, nor that the strategies identified do not have drawbacks. Rather, they appear to lower the most prevalent barriers to employment. Child Care Among a sample of RNs who received their first licenses in 1962 and who were not working 10 years later, the great majority (77.6 percent of associate degree (AD) nurses, 85.4 percent of diploma nurses, and 83.4 percent of baccalaureate nurses) cited as a reason responsibilities for raising children.54 A substantial portion of the inactive and part-time supply of nurses had children at home under the age of six. Although the federal tax law currently provides deductions for child care, the amount may not be sufficient to make a meaningful difference for nurses, given their salary levels and special requirements for day care. Traditional day care may not meet the needs of nurses who often work other than traditional office hours. Both the AHA and the National Association of Nurse Recruiters (NANR) report that only about 6 percent of hospitals offer child care facilities.55~56 To the extent that family responsibilities act as a barrier to greater labor force participation, employers should consider the potential costs and benefits of establishing child care facilities singly or in concert with others in the community. Factors of cost include the scope of operation, contracting with local centers, transportation systems to community facilities, in-hospital
206 versus adjacent facilities, extent of subsidization by the employer, and allocation of priorities among types of nursing service personnel. Benefits to the institution could include enhanced ability to recruit and retain nurses (particularly during shifts difficult to staff), reduction in absenteeism, and Improved morale. However, no careful evaluation has been made of the degree to which child care benefits contribute to influencing reentry into the market. It is conceivable that the major effect in any particular community would be to entice nursing personnel from other institutions rather than attracting back to the labor force nurses who had become inactive. Flexible Scheduling Hospitals are experimenting with various ways of staffing that permit nurses to work schedules adapted to their personal needs. Examples include three 12-hour shifts per week; optional 10-hour shifts for evening and night shifts--4 days one week, 3 the next; and "mothers' hours"--shifts ranging from 4 to 7 hours with reduced weekend commitments. The NAN R reports that a majority of its members (79 percent) in 1982 offer some form of flexible scheduling--an increase of 11 percent from the previous years.57 Although use of flexible scheduling alone may encourage reentry or increased work hours, hospitals often are combining these incentives with compensation packages, such as a full week's wages for reduced hours on the weekends. In these instances, managers may be faced with a trade-off between fulfilling their most pressing staffing needs and incurring increased costs and possible overall reductions in total RN hours worked. Institutions should monitor these effects to determine whether such measures attract more reentrants or reduce the effective nursing service supply. Improved Salary Employers should consider increasing salary levels in order to attract inactive nurses into the labor force and to encourage part-time nurses to work more hours. Economic research has shown consistently that nurses' rates of labor force partipication increase with salary levels.58~59~60 Thus, higher salaries could be expected to bring some inactive nurses into the labor force, with an increase in the effective supply. Nurses who already are working may also increase their hours of work in response to higher pay, as has been found by same researchers.61 However, when salary levels become high enough, some individuals may decide to reduce their hours of work in order to spend more time with their families or to enjoy more leisure time, a phenomenon characterized by labor economists as the "backward bending" labor supply curve.62 One recent study has detected this phenomenon in nursing.63
207 The higher a nurse's earnings, the greater the cost of not working. Thus, in general it can be expected that salaries can be one of employers' most effective ways of encouraging nurses to remain in the labor force. In addition, salary levels serve as signals of potential earnings to persons considering a career in nursing, and thus play a role in recruitment and long-term supply as well. Fringe Benefits In the process of reexamining salary structure policies, employers also should take into account the potential of creative fringe benefit packages in attracting nurses into the labor force. For example, by offering a program of so-called "cafeteria benefits," various segments of the inactive supply may be reached. These could include married nurses whose husbands already are entitled to family coverage for health insurance, or nurses who might value educational benefits more highly, as well as those who would prefer to take their benefits in cash. Again, employers must weigh the administrative costs--both in teems of dollars and personnel management issues--against the presumed benefits. Reentry Education Opportunities The National Commission on Nursing noted in its 1981 Preliminary Report that, although surveys have indicated that a lack of refresher courses is often cited by inactive nurses as a reason for not returning to the labor force, such programs have not proved cost effective in some settings and do not result in a high rate of return to employment. Carefully targeting programs to those who drop out of nursing during childbearing years and basing programs in the college-level system are factors that could improve their success.64 The Special Problems of Nursing Homes As was mentioned in the beginning of this chapter, nursing homes face many of the same management problems as hospitals. However, because of the weak financial revenue position of many of such homes, nurses must work for 20 percent lower pay and fewer fringe benefits than are offered by hospitals. While opportunities for professional satisfaction can often outweigh the lure of higher wages, nursing homes--with their reputation for the isolation that understaffing produces and limited freedom to control the kind of nursing practice in the institution--are, not surprisingly, viewed as low-status work settings by many registered nurses.65 Until there is more progress in addressing the financing and educational issues of care for the elderly, discussed in Chapter VI, there will be low effective demand by nursing homes for nurses. Nursing homes will continue to have difficulty offering quality professional nursing services. In the interim, nursing home managers
208 who wish to enhance their ability to retain the nurses they currently employ should take note of a recent survey of nurses in North Carolina. Availability of Innovative scheduling plans permitting predictable work schedules was a major factor cited by nurses for remaining in the inst itut ion' s employ. 66 Although reimbursement constraints may prevent managers from addressing the major reason c ited for resignation--low salaries--attention to the employee's personal needs, such as in scheduling, may yield improvements in retention. Conc fusion Although nurses in the aggregate neither leave their profession in greater numbers than other women nor leave their jobs more frequent ly than people in other professions, there nevertheless are large numbers of employers wi th chronic nursing vacanc ie s and a high turnover rate . These managers can act to make their hospitals more attractive to nurses. First, they should look to some of the traditional management practices that detract from nursing, such as lack of career and pay advancement. Employers should develop new practices that will act as incentives for nurses to stay. Second, employers should investigate whether the introduction of flexible scheduling, novel benefit packages, child care assistance, or other measures would persuade inactive nurses back to work and part-time nurses to increase their hours. Ef forts of this sort will, the committee believes, both improve the quality of nursing care by addressing sources of d i sc ant ent, and e nhanc e the image o f the pr of e s s i on, thu s at trac ti ng greater numbers of good candidates into nursing. RE OOMME:NDATION 16 The proportion of nurses who choose to work in their profession is high, but examination of conventional management, organization, and salary structures indicates that employers could improve the supply and j ob tenure by the f ol lowing: · providing opportunities for career advancement in clinical nursing as well as in administration · ensuring that mer it and experience rewarded by salary increases · assessing the need to raise nurse salaries if vacancies remain unf tiled · encouraging greater involvement of nurses in decisions about patient care, management, and governanc e of the inst it ut ion · ident if ying the maj or deterrents to nurse labor force part ic ipation in their own localities and responding by adapting conditions of work, child care, and compensation packages to encourage part-time nurses to increase their labor force partic ipation and to attract some inactive nurses back to work. in direc t pat lent care are
209 Accounting for Nursing Services The committee is well aware that its recommendations for management reforms have associated costs. There are several ways in which increased costs could be met. First, they may be reflected in higher costs to patients and third party payers, but that is becoming more difficult in the present climate of cost containment. Second, allocation of resources in the hospital could be shifted, under the assumption that the institution is willing to favor the nursing service department. Finally, nursing service departments could rearrange patterns of staffing and assignments to raise productivity without claiming a greater proportion of the hospital budget. Nursing services in health care institutions, particularly hospitals, traditionally have been treated as an undifferentiated component of a daily cost or charge that covers room, board and other expenditures, as contrasted with other services that contribute to revenue generation. As a result, there has been little incentive to devise accounting systems, payment formulas, and management structures that attempt to identify the true value of bedside and other identifiable nursing services. In the present period of rapidly rising costs, new methods of payment will be adopted to force greater institutional efficiency and effectiveness. Although it is unclear how hospitals will respond, the current structure of accounting for nursing services in a provider's budget does not permit any rational basis for arriving at allocations of expenditures or revenues that take nursing into account as a distinct, major component of the hospital's activities. Without such useful management information, hospitals will be in a poor position to bargain with rate-making authorities or with purchasers of care over appropriate payment levels, and cannot make the most effective resource allocation decisions. Because very few experiments have been conducted with new accounting or payment methods that account separately for direct nursing service costs, the organizational effects and possible unintended consequences of such changes are unknown. At least three presumed benefits can be mentioned. The first is that nurse autonomy will be enhanced. The second is that such an approach would permit sophisticated managerial analysis of approximately one-third of hospitals' costs and would facilitate managerial changes to place responsibility upon the professional staff that provides the services. Finally, the acceptance of such an approach would permit the examination of the effect of reimbursement or payment patterns on nursing practices and particularly on the quality of nursing services. Although there is reason to believe that these benefits will be realized, there are potential pitfalls. The allocation of resources to nursing could be reduced once costs are identified and rates negotiated on the basis of such data. Specific measures to overcome turnover, enhance career opportunities, and make other positive (but costly) innovations could be inhibited. New cost contai,u~ent approaches such as the diagnosis-related group (DRG) hospital reimbursement method implemented in New Jersey and in some other states and localities, and now being proposed for
210 Medicare, are calling attention to the need for nursing service administrators to understand resource allocation issues better. The management team representing nursing, the medical staff, administration, and ancillary departments are encouraged to establish less costly combinations of services to treat specific medical problems. During this process, nurse managers are being asked questions for which present management information and accounting systems are inadequate. These include the following: · Is the skill mix of the staff too rich in the number of professional nurses employed? · Is the department overstaffed for the patients treated? · Do professional nurses devote too much time to indirect duties? · Does the nursing budget carry expenses incurred by housekeeping, dietary, and other departments? · Can RNs be freed from some tasks by well-trained LPNs or technicians?67 A method for accurately assigning costs to different nursing functions, units, and even specific patients would help in answering many of these questions. In the absence of some greater operational experience and evaluation of effects, the committee conditionally endorses the concept of separate cost/revenue centers for nursing, but strongly recommends additional experimentation and assessment. Conclusion As cost containment pressures force hospital management to become more skilled at using resources productively, it becomes important that managers have the tools to allocate nursing costs accurately and to develop a system whereby people at all levels of management are responsible for using the nursing staff most effectively. To achieve these goals, management needs information on methods of measuring patient severity of illness and associated nursing costs, which today are not sufficiently refined for widespread implementation. REOOMMENDATION 17 Lack of precise information about current costs and utilization of nursing service personnel makes it difficult for nursing service administrators and hospital managers to make the most appropriate and cost effective decisions about assignment of nurses. Hospitals, working with federal and state governments and other third-party payers, should conduct studies and experiments to determine the feasibility and means of creating separate revenue and cost centers for direct nursing care units within the institution for case lapis costing and revenue setting, and for other fiscal management alternatives.
211 REFERENCES AND NOTES 1. 2. National Commission on Nursing. Nursing in transition: Models for successful organizational change. Chicago, Ill.: The Hospital Research and Educat tonal Trust, 1982. Department of Health and Human Services, Health Resources Administration. The registered nurse population, an overview. From national sample survey of registered nurses, November, 1980 (Report No. 82-5, Revised June 1982). Hyattsville, Md.: Health Resources Administration, 1982. Price, J.L., and Mueller, C.~. Professional turnover: The case . of nurses. New York: SP Medical and Scientific Books, 1981, P. 1 e 4. American Hospital Association. Preliminary data from nursing personnel survey, 1981. Unpublished data. 5. Maryland Hospital Association. Nursing vacancy and turnover rates. Unpublished data, 1982. 6. North Carolina Area Health Education Centers Program. North Carolina AHEC: 1982 nurse manpower survey (final report). . ~ Chapel Hill, N.C.: University of North Carolina AHEC Program, 1982, p. 51. National Association of Nurse Recruiters. Recruitment survey June 1982. Pitman, N.J.: National Association of Nurse Recruiters, 1982. 8. Sekscenski, E.S. The health services industry: A decade of expansion. Monthly Labor Review, 1981, 105~5), 9-16. 9. National Association of Nurse Recruiters. Recruitment survey, June 1982. Op. cit., p. 3. 10. Maryland Hospital Association. Nursing vacancy and turnover rates. Op. cit., p. 3. 11. White, C.H. Changing the workplace for nurses. CHA Insight, 1982, 6~30), 1-4. 12. North Carolina Area Health Education Centers Program. North Carolina AHEC: 1982 nurse manpower survey (final report). Op. cit., p. 57. 13. Miner, M.G. Job absence and turnover: A new source of data. Monthly Labor Review, 1977, 100~10), 24-28. 14. American Hospital Association. Preliminary data from nursing personnel survey, 1981. Unpublished data. 15. See Price, J.L., and Mueller, C.W. 16. Weisman, C.S., Alexander, C.S., and Chase, G.A. Job satisfaction and turnover among hospital nurses. Final report. Baltimore, . . . Md.: The Johns Hopkins University School of Hygiene and Public Health, 1979. 17. Governor's Task Force on Nursing. Final report and recommendations. Paper presented to Governor Albert H. Quie, State of Minnesota, January 1982. 18. Stuart, G.W. Nursing role satisfaction. Background paper of the Institute of Medicine Study of Nursing and Nursing Education. Available from Publication-on-Demand Program, National Academy Press, Washington, D.C., 1983.
212 19. National League for Nursing. Registered nurses licensed in 1978: An analytic report prepared for subscribers to the NLN _ _ . . . ~ . _ School Report Service on newly licensed nurses, 1980. New York: - Nat tonal League for Nurses, 1980. 20. Weimnan, C.S., et al. Op. cit., p. 151 and 157. 21. See National Commission on Nursing. Nursing in transition: Models for successful organizational chance. 22. Friss, L. Hospital nurse staffing: An urgent need for management reappraisal. Health Care Management, 1981, 7~1) 2 1-28 . 23. National Joint Practice Commission. Guidelines for establishin joint or collaborative practice in hospitals. Kansas City, Mb. American Nurses' Association, 1981. 24. Bureau of Labor Statistics. Industry wage survey: Hospitals, August _19 75-January 1976 (Bullet in No . 1949) . Washington, D. C.: U.S . Government Printing Off ice, 1977, Table I. 25. Bureau of Labor Statistics. Industry wage survey: Hospitals and nursing hones, September 1978 (Bulletin No. 2069~. Washington, D.C.: U.S. Government Printing Office, 1980. 26. Bureau of Labor Statistics. Industry wage survey reports (a compilation of 22 area reports which will be summarized and published as a comprehensive report in early 1983~. 27. Ibid. 28. Fag in, C. M. The net tonal shortage of nurse s: A nurs ing perspective. In L.H. Aiken (Ed.), Nursing in the 1980s: Crises, opportunities, challenges. Philadelphia, Pa.: J. B. Lippincott Company, 1982, p. 26 . . Hartmann, H. Testimony presented at the Open Meeting of the Institute of Medicine Study of Nursing and Nursing Education, National Academy of Sciences, Washington, D.C., May 1981. . Department of Health and Human Services, Health Resources Admini strat ion. The recurrent shortage of red istered nurse s: A ~ Y new look at the issues (DHHS Publication No. HRA-81-23~. Washington, D.C.: U.S. Government Printing Office, 1981. 31. Bureau of Labor Statist ics . Perspectives on working women: A databook (Bulletin No. 2080~. Washington, D.C.: U.S. Government Printing ()95 ice, 1980, p. 59. 32. Hartmann, H. Op. cit., p. 2. 33. Treiman, D.J., and Hartmann, H. I. Women, work, and wages Equal pay for jobs of equal value. Washington, D. C.: National Academy Press, 1981. 34. Hartmann, H. Op. cit., p. 8. 35 . Rytina, N. F. Earnings of men and women: A look at spec if ic occupations. Monthly Labor Review, 1982, 105~4), 25-31. 36. Habibi, M. Legal issues influencing nurse practice. Background paper of the Institute of Medicine Study of Nursing and Nursing Education. Available from Publication-on-Demand Program, National Academy Press, Washington, D.C., 1983. 37. Wandelt, M. Conditions associated with registered nurse employment in Texas. Austin, Tex.: Center for Research, School of Nursing, University of Texas, 1980.
213 38. Aydelotte, M. Professional and organizational structures. Paper presented at the Nat tonal Invitat tonal Leadership Conference of the National Commission on Nursing, San Antonio, Tex., March 1982. 39. Parlette, G. N., O'Reilly, C.A., and Bloom, J.R. The nurse and the union. Hospital Forum, 1980, 23~5), 16-17. 40. Sexton, P.C. The new nightingales. New York: Enquiry Press, 1982, p. 31. 41. Roth, A.V., and Schmittling, G.T. LPNs: 1974 inventory of licensed pract ical nurses . Kansas C ity, Ma .: American Nurses ' Assoc Cation, 1977, p. 4. 42. Feldbaum, E.G. Registered nurses at work. A report to administrators of health facilities. College Park, Md.: Bureau of Governmental Research, University of Maryland, 1980, pp. 1-4. 43. Roth, A., Graham, D., and Schmittling, G. 1977 national sample survey of registered nurses: A report on the nurse population - _ and factors affecting their supply NTIS Publication No. HRP-0900603~. Kansas City, Mo.: American Nurses' Association, 1979., Table 83 and 86. 44. DHHS, BRA. The registered nurse population, an overview. From national sample survey of registered nurses, November, 1980. Op. cit., p. 7. 45. Altman, S.H. Present and future supply of registered nurses (DHEW Publication No. NIH-73-134~. Washington, D.C.: U.S. Government Printing Office, 1972, p. 135. 46. Sloan, F.A., and Richupan, S. Short-run supply responses of registered nurses: A microanalysis. Journal of Human Resources, 1975, 10~2), 241-257. 47. Link, C.R., and Settle, R.F. Wage incentives and married professional nurses: A case of backward-bending supply? Economic Inquiry, 1981, 19~1), 144-156. 48. Levine, E. The registered nurse supply and nurse shortage. Background paper of the Institute of Medicine Study of Nursing and Nursing Education. Available from Publication-on-Demand Program, National Academy Press, Washington, D.C., 1983, p. 50. 49. Prescott, P.A., 3anken, J.K., Langford, T.L., and McKay, P. Temporary service agencies: Where and why are they used? Baltimore, Md.: University of Maryland School of Nursing, 1980. 50. Feldbaum, E. G. Op. cit., pp. 4-9. 51. Hunt, H.A. Registered nurse education and the registered nurse job market. Berke fey, Calif.: California University Press, 1974. (NTIS No. PB-236-182) 52. Levine, E. Op. cit., p. 20. 53. Ibid., p. 26. 54. Knopf, L., and Vaughn, J. C. Work-life behavior of registered nurses: A report of the nurse career-pattern study (Append ix, Final Report) (NTIS No. ~P-0900631~. Hyattsville, Md.: Health Resources Administration, 1979, p . 120. 55. American Hospital Assoc Cation. Preliminary data from nursing personnel survey, 1981. Unpublished data. 56. National Association of Nurse Recruiters. Recruitment survey, June 1982. Op. cit., p. 17.
214 57. Ibid. 58. Altman, S. H. Op. cit., p. 135. 59. Benham, L. The labor market for registered nurses: A three-equation model. The Review of Economics and Statistics, 1971, 53~3~. 60. Bishop, C. E. Manpower policy and the supply of nurses. Industrial Relations, 1973, 12~1~. 61 . Sloan, F.A., and Richupan, S . Op. c it., pp. 241-257. 62. Scholar, C. J. Economic perspectives on the nursing shortage. In L. Aiken (Ed.), Nursing in the 1980s: Crises, opportunities, challenges . p. 42. Link, C.R., and Settle, R.F. Op. cit., pp. 238-243. National Commission on Nursing. Initial report and preliminary Chicago, Ill.: Educ at tonal Trust, 1981. 65. Shields, E.M,. and Kick, E. Nursing care in nursing homes. In L. Aiken (Ed.), Nursing in the 1980s: Crises, opportunities, challenges. Philadelphia, Pa.: J. B. Lippincott Company, 1982, pp . 19 9-200 . 66. North Carolina Area Health Education Centers Program. North Carolina AHEC: 1982 nurse manpower survey (final report). . cit., p. 37. 6 7 . Grimald i, P. L. DRGs & nurs ing admini strat ion. Nurs ing Management, 1982, 13(1 ), 30-34 . 63. 64. Philade lphia, Pa .: J. B. . Lippinc ott Company, 1982, rec ommendat ions . The Hospital Re search and
