NHS FPX 6008 Assessment 3 Business Case for Change Free Download Student name Capella University NHS-FPX 6008 Professor Name Submission Date Business Case for Change Side 1 Hello, I’m _______ and I’m here to present a business case to you for the biggest financial, reputational and patient safety threat facing organisations today – severe nursing shortages and the ever-increasing need for extremely costly contracted staff. The study looks at how reliance on contract staffing has become an asset and a risk to financial strength and integrity of the organization. This study is intended to create financial and clinical viability for the facility by shifting from expensive recruitment cycles to a tried and trusted retention plan that will ensure our existing nurse workforce stays put; thereby reducing the need for the use of expensive contract labour. The Economic Problem Slide 2 Nurses have many important roles in providing quality health care in health care systems. Studies, in fact, have shown that with the proper number of nurses in hospitals and other health care facilities, patient safety is further enhanced, and the death rates within the hospitals are negatively affected, directly affecting the patient. In the U.S., the nursing shortage is both an economic and a financial challenge and has a significant impact on the health care economy. In addition, the studies show that the lack of nurses puts operating budgets of hospitals and facilities at risk, damages their reputation, and, most significantly, compromises patient safety, particularly in regard to providing around-the-clock care. By carefully targeting the bottom line, organizations can not only keep their finances steady, but also keep their operating margins in positive territory while investing in their staff development and retention. Impact at Macro Level Slide 3 There has been a large-scale destabilization effect throughout the entire health care delivery system as fewer numbers of nurses are available to work and over-capacity and burnout are experienced. Furthermore, the high turnover among nurses causes the hospital to be under severe financial pressure because of the use of expensive temporary nurse staffing agencies. In addition to the short-term financial burden placed on hospitals by having to pay for these temporary staffing agencies, hospitals continue to divert the majority of their resources toward providing necessary staff rather than toward enhancing patient services and investing in new technologies, which places additional burdens on community residents in terms of access to services, increased wait time for appointments, and an increased likelihood of receiving substandard care. This trend is systemic, meaning that there is a clear need to shift away from the current high-spending models of simply responding to problems that have arisen in the nursing workforce toward making proactive investments in programs that will ensure long-term stability and growth of the nursing workforce. Feasibility Consideration Slide 4 From a solely reactive hiring approach to a nurse retention-based approach is not only financially sustainable, but it’s also a fiscal condition that is necessary. The key to enabling this shift lies within the reallocation of dollars from those of high cost (recruitment, contract labour, etc.) and low variable value (low value) to those of low variable cost (high value) through mentoring and continuing education. The evidence base is strong, showing that structured orientation/transition to practice is a basis for maintaining the nursing workforce. Furthermore, if healthcare organizations adopt an approach of mentoring and promoting their new employees, each one can realize months’ worth of productivity as soon as they step on the job, and that huge productivity cost will diminish margins. Structured, evidence-based residency programs have been shown to be a sustainable way to keep nurses in rural/community hospitals; enhance nurse retention; and enhance job satisfaction. Remember, moving money toward these strategic retention strategies will help refocus healthcare leaders’ attention from a very unpredictable financial burden to a solid foundation for quality patient care. Cost-Benefit Considerations Slide 5 In hospitals with a registered nurse (RN) shortage, there is higher nurse turnover, overtime, contract nurses, adverse patient events, and lower quality of care costs. Rethinking and retaining nurses, however, have their economic and patient care rewards as well. There is evidence that each nurse turnover costs a hospital as much as 3x the annual cost, due to recruitment, onboarding, and orientation costs, as well as lost productivity and overtime pay. Among 1,501 RNs at 7 hospitals, a turnover rate of 24% equated to 360 turnovers at an average cost of $85,498 per nurse or almost $27.9 million lost organization-wide. A hospital that increased pay by $9,000 annually, to $150 million, decreased use of contract RNs from 1,370 to less than 300, returning the turnover rate to pre-pandemic levels. Evidence-based initiatives for nurse retention, like residency programs, have clearly demonstrated positive returns on investment (ROI) in terms of the positive impact they have on workforce availability and the resulting reduced use of high-cost contract nurses. Strategies for Risk Mitigation Slide 6 Instead of expensive turnover and hiring and training nurses, organizations should, at least, establish nurse residency programs. These programs include clinical mentorship and systematic professional development that can help increase retention during the first year of practice – a time when turnover is particularly high, as well as lower new graduate turnover from more than 36 percent to less than 7 percent. Hospitals can save the expenses that go into replacing the nurse (currently, in excess of $60,000 per nurse) from being a recurring expense. By improving nurse retention, which in turn is tied to staffing stability and less nurse turnover, financial losses from nurse turnover can be drastically decreased, as can overtime requirements, recruitment costs, and the need for costly agency nurses. The high turnover rate of nurses results in higher operational costs and negatively affects the sustainability of the workforce, researchers concluded. On the other hand, nurses’ tendency to stay with an organization is increased as their job satisfaction, organizational commitment, and supportive workplace increase, which decreases the expenses of employee turnover. The use of effective financial controls and cost management can help to
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