Nurse understaffing has been cited in the mainstream scholarly literature as leading to a number of adverse effects including poor patient outcomes, increase in nurse workload and job dissatisfaction, as well as financial cost implications for healthcare institutions (Martin, 2015). This paper reports on the findings of interviews held with two practitioners regarding the issue of nurse understaffing.
The primary financial management issue under investigation revolves around understanding the financial implication of nurse understaffing within the home health agency (HHA) and what has been done to address the issue. The home health agency is primarily concerned with the provision of skilled nursing services and other therapeutic services to patients in their homes, implying that it has an overall plan and budget for institutional planning. The interviews have been done with the registered nurse (RN) supervisor and a representative of the finance department. The RN supervisor’s role revolves around coordinating and managing all services rendered to clients and supervising nursing personnel, while the finance representative is concerned with maintaining books of accounts and allocating financial resources based on need.
Statistically, studies have demonstrated that “about 45 percent of new nurses leave their first hospital jobs within two years of graduating from nursing school – and inappropriate nurse staffing levels are unlikely to encourage them to remain at their first hospital of employment” (Sanford, 2010, p. 39). Within the context of the HHA, the finance representative acknowledges that the agency has been spending around $75,000 annually to recruit new nurses to replace those who have already left due to burnout and dissatisfaction. Further, the HHA has been spending around $35,000 annually to deal with medical errors and other adverse events occasioned by the nursing shortage. Bearing in mind that the HHA has an annual turnover of $548,000, it can be argued that the financial management issue under study consumes around 20.1% of the agency’s profits.
The two respondents agree that the HHA has attempted to address the issue for around five years without much success. However, they hold different perspectives regarding the issue. While the RN supervisor cites nurse overtime and increased pay as some of the possible solutions that could be used to address the issue, the finance representative disagrees due to cost implications to the agency. Current literature demonstrates that the finance representative’s argument is correct as the “time worked, overtime, and total hours worked per week have significant effects on errors” (Martin, 2015, p. 4). Such medical errors can have adverse financial implications in terms of patient legal suits and loss of clientele. Overtime and long working hours have also been blamed for leading to nurses’ job-related burnout and job dissatisfaction, which in turn result in a low nurse retention rate (Sanford, 2010). It is costly financially for the HHA to keep on recruiting new nurses from the market to replace those who have left.
Both interviewees agree that the issue is being addressed by hiring more part-time nurses as well as providing incentives to existing nurse professionals to curtail their exit. Such incentives include financial bonuses, recognition, as well as the delegation of duties. More part-time nurses could address the monetary costs related to nursing turnover due to burnout and exhaustion (Sanford, 2010), while the provision of incentives to existing nurses could address the adverse financial implications related to working with unhappy and dissatisfied nurses (Chapman et al., 2009).
The finance representative acknowledges that some of the future steps that have been planned to address the issue include doing away with mandatory nurse overtime, hiring temporary nurses, and ensuring the HHA has the right number and mix of nurses to satisfy patient needs. Available literature shows that some states in the U.S. have already begun legislation on the regulation of mandatory nurse overtime by introducing laws that “either ban nurse mandatory overtime or limit the total number of hours nurses may work” (Bae, 2012, p. 61). Research is consistent that having the right mix of nurses not only cuts nursing costs but also lowers the number of patient adverse events and reduces the length of stay at the institution (Sanford, 2010). Furthermore, Chapman et al (2009) argue that the financial costs associated with adverse events resulting from nurse understaffing (e.g., medical errors, poor patient care, nurse turnover) can be successfully avoided by increasing the number of nursing professionals.
Lastly, the interviewees report several bottlenecks that stand in the way of achieving an amicable solution to the issue under study. On his part, the RN supervisor cites the shortage of nurses in the market, financial constraints, as well as lack of commitment from senior management as some of the blocks that could forestall any attempts to resolve the issue. The finance representative cites financial constraints related to the hiring of temporary and new permanent nurses as an important challenge.
Overall, this paper has analyzed the findings of interviews held with two practitioners regarding the issue of financial implications of nurse understaffing in the HHA. From the discussion and analysis, it is evident that the issue of nurse understaffing cannot be resolved by increasing pay or forcing nurses to work overtime. Rather, more financial resources and incentives need to be committed with the view to ensuring the HHA can hire more part-time nurses and retain existing ones.
Bae, S.H. (2012). Nursing overtime: Why, how much, and under what circumstances? Nursing Economic$, 30(2), 60-72.
Chapman, S.A., Spetz, J., Seago, J.A., Kaiser, J., Dower, C., & Herrera, C. (2009). How have mandated nurse staffing ratios affected hospitals? Perspectives from California hospital leaders. Journal of Healthcare Management, 54(5), 321-355.
Martin, C.J. (2015). The effects of nurse staffing on quality of care. MEDSURG Nursing, 24(2), 4-6.
Sanford, K.D. (2010). Nurse staffing: Finding the right number and mix. Healthcare Financial Management, 64(9), 38-39.