The Nursing Shortage: A Bedside RN's Perspective
What the Industry Says about RN earnings
About the writer 
Current Legislation
The "Alpha" factors
Earnings of RNs
The cost of Understaffing
What Industry Leaders say
Foreign Nurses , The Traditional Salve

Qual-Med-a story of financial growth by an HMO and one of its MD founders [Dr. Hasan]: 
Its financial success in 1998
[(BW)(FOUNDATION-HEALTH)(FHS) FHS Reports Fourth Quarter and Year-End Results; $70 Million in Cost Savings Achieved]

Another item that  rankles is salary differences.Permanent staff nurses at Hopkins Hospital earn an average base rate of  $22 per hour.  Hopkins pays the  agencies that provide temporary nurses about twice  that rate. (Just how much of that money ends up in the hands of the temporary nurses is not clear.)   " Nationwide Nursing Crunch. Johns Hopkins Magazine. June 1999. 

"Last year, Gail Warden had at least two headaches he wanted to get rid of. As president and CEO of the Henry Ford Health System in Detroit he wanted to make Henry Ford Hospital profitable and drive down losses at its medical group. He decided it was time for harsh medicine: He called The Hunter Group
The results? 
"We've seen a big pickup in productivity, a reduction of $3 million a month in payroll costs and an increase in revenue," Warden says. "I'm a fan of theirs. I think there's a lot of good reasons to be concerned if you're on the receiving end of their recommendations but they get the job done." 
Hospitals  Reality Check by Howard Isenstein . Health Leaders Magazine. June 2002
Warden himself has served as an adviser to The Hunter Group.causing one to  wonder why one of its consultants so recently employed there would find it necessary to call them in to help him do his job as CEO. 

1999-2000: "Despite the nurse shortage, employers have yet to respond by raising nursesŪ salaries dramatically. Median weekly wages for RNs increased 1.8 percent from 1999-2000, to $790...Over the past five years, RNs have seen an increase of only 0.8 percent, while real wages for the general workforce have risen 6.6 percent." 
The American Federation of Teachers, a union that also represents Nurses in certain parts of the country,  in their web pages. 

2000-2001: "Hospitals are experiencing severe workforce shortages.› There are more than 168,000 unfilled positions, of which 75 percent are for registered nurses.› Partly as a result of these shortages, full-time nurse salaries rose by as much as 10 percent across the country from 2000 to 2001; pharmacist salaries rose by as much as 13 percent.› It is estimated that hospitals will have spent $71 million in 2001 using agency and traveling nurses to fill slots left vacant by the shortage of staff nurses.
MBIA Insurance Corporation
Jan. 2002 letter to MedPAC› 

Those kinds of results have helped the St. Petersberg, Fla.-based healthcare management consulting firm more than double its revenues in recent years. The Hunter Group raked in revenues of $25 million in 2001-up from $10-$13 million in the mid-1990s-and grew from three employee-owners in 1987, the year of its founding, to 15 owners and about 45 full-time staff members today. "Our reputation and our references support the magnitude of results that our clients have been able to achieve with our support...and to sustain over the long term," says David Hunter, Hunter Group CEO.
Until recently, much of the firm's work has centered on turning around ailing hospitals. The firm has made its name by encouraging hospitals to make sometimes-drastic budgetary and staffing cutbacks, with the goal of bringing the organizations back to profitability. But looks can be deceiving, Hunter says.
It'snot just patients who notice. Hospital unions break out in hives when they hear that The Hunter Group is even being considered by a hospital board. Indeed a January-February 2000 issue of Revolution magazine, a hospital union publication, devotes a nine-page feature to the firm, accusing it of a "scorched- earth" hospital turnaround philosophy where only the "bottom line matters."
Hunter readily admits that making painful decisions and cost cutting is central to his firm's turnaround philosophy."
Hospitals  Reality Check by Howard Isenstein . Health Leaders Magazine. June 2002

"According to a new report in Hospitals & Health Networks, hospital compensation packages are up 6.6% over last year. Nurses led the way with an 8.1% increase in base salary, and incumbent hospital CEOs checked in with a 7.5% salary increase. Other executives saw a 6.2% base salary jump and the salaries of hospital department heads rose 5.9%. According to the statistics, base salary levels are higher than ever.   In 1999, base salaries rose 3.8%, in 2000 they jumped 3.6% and the 2001 data revealed a 4.1% hike. The median CEO base salary for 2002 is $237,000, but total cash averages paid to CEOs -- base plus incentives -- increased 13.4%. All  data were gathered and analyzed by the Hay Group, in cooperation with the America Society for Healthcare Human Resources  Administration. For more information go to"  Survey: Nurses lead hospital salary increases September 16, 2002. From the American Hospital Association webpages at

"At age 51, Miami Children's Hospital was having trouble deciding what it wanted to be when it grew up, says President and CEO Tom Rozek, who arrived in January 1999. It was trying to be all things to all people and was paying the price. The 268-bed hospital suffered a string of losses in the mid-'90s. By fiscal year 1998, it was $22.3 million in the hole.Hospital figures for the past two years are impressive. While the hospital took a loss of $2.3 million for 1999, it earned $17 million in 2000, and unaudited figures show that it made $9 million in 2001. The hospital now receives $4.5 million each year for its residency program from the National Association of Children's Hospitals. It also sees an additional $10 million each year in reimbursements on its 25 managed care contracts. Patient volume has also increased due to better physician relationships, Rozek observes. Down the road, Rozek says, the hospital will have to stay on top of its communication practices so the community remains aware of the services Children's provides. "If we don't get federal and state funding, and support from philanthropy, we still will have difficulties." 
By Michelle Rogers 
Turnaround    Tom Rozek  President and CEO, Miami Children's Hospital 
Health Leaders Magazine June 2002

Long Term Care:
."First, we find the requirement to have a registered nurse on duty 24 hours a day impractical as well as economically unfeasible. Hospitals across the country are reporting difficulties recruiting and retaining registered nurses. Additionally, the funding of one nursing position in these child serving facilities represents approximately three (3) full-time direct care positions. The financial burden imposed by this rule will force facilities to close or to stop serving troubled children and youth altogether. We are deeply concerned that these children will be forced into other more restricted settings, such as juvenile justice facilities and hospitals. We believe rather than allocating funds for the hiring of registered nurses, who would be underutilized, it is better these funds be used to reduce the use of restraint and seclusion by providing better training and the hiring of additional direct care staff. "
Child Welfare League. 
CWLA's comments filed March 15 [2001] on the interim final rule on the use of restraint and seclusion in psychiatric residential treatment facilities for individuals under the age of 21.

" a healthy economy, nurses, pharmacists, and other health care workers often leave hospital practice and post-acute facilities for other settings that meet their salary and family needs and are less stressful. Other significant factors driving staff away from hospitals and making health care a less attractive field for students are the diminished time for bedside care and increasing responsibility for regulatory paperwork and compliance. "
Advocacy and Representation
A Lobbying arm for hospitals and health systems

"Many federal, state and private organizations have begun searching for ways to forestall the 2010 healthcare crisis, or at least cushion its impact. The American Organization of Nurse Executives published a study, "Perspectives on the Nursing Shortage: A Blueprint for Action," which covered most of the remedies proposed so far.
Better pay was one, but it was not high on the list, even though nurses' pay is substantially lower than that in most occupations requiring comparable qualifications and education. "Nurses are not about money," said Joan Levy, a senior associate director of public affairs at Johns Hopkins School of Nursing. "They're about helping people. Working conditions and recognition are more important to them. If they were about money, they would have chosen another career." "
Keeping the Nursing Shortage From Getting Worse Can a Crisis in 2010 Be Avoided?  by Lee Hickling Health News   Jan 11 2001

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