How nurse residency programs can help organizations add to their bottom line.
By Tierney McAfee
Nurse residency, or âgrow your own,â programs are a critical part of the future of nursing. Theyâre not only helping organizations solve for the growing nurse shortage facing the U.S., theyâre also helping participating healthcare systems and hospitals save money.
âItâs one of those things that absolutely over time will lower costs and increase retention for hospitals and health organizations,â says Liz Bickley, senior vice president of healthcare client services for Cielo, a strategic recruitment process outsourcing (RPO) partner.
âIt requires initial investment to build the infrastructure and get the programs up and running, but then you will begin to avoid some of your premium pay because departments are better staffed, and avoid some of your contingent costs or traveler nurse costs because you have more staff,â Bickley explains.
The establishment of nurse residency programs is also foundational to new nurse graduatesâ transition and retention, says Bickley.
âNurses who are welcomed into an organization as new graduates, who have a really robust continued education program, who are supported appropriately from a preceptor program, tend to stay,â she explains.
This kind of employee loyalty can be a huge financial benefit to organizations at a time when losing just one nurse can cost up to $61,100, according to the 2018 National Health Care Retention & RN Staffing ReportÂ published by NSI Nursing Solutions, Inc. Overall, nurse turnover can cost organizations between $4.4 million and $7 million per year. And the problem is only getting worse. Hospitals experienced a rise in RN turnover in 2017, with the national average at 16.8 percent, a 2.2 percent increase from 2016.
Meanwhile, hospitals with nurse residency programs demonstrated a 6 to 10 percent reduction in voluntary turnover rates, which translates to approximately $17.6 million in annual statewide cost savings, according to a 2018 article in the Journal of Nursing Regulation.