The Price of Employee Turnover

The Price of Employee Turnover

The long-term care industry provides crucial services to millions of patients at skilled nursing facilities across the United States. But the field also faces a critical challenge: high employee turnover. Estimates of the current turnover rate in long-term care range from 45 to 66 percent.

That’s nearly one half to two-thirds of direct care workers leaving their positions — which creates a host of serious problems for providers, including the expense of replacing and training employees, a lack of adequate staff to care for patients, and the risk of falling short of compliance requirements.

Why It Happens

Front-line care workers perform essential work day in and day out, and they need optimal conditions to thrive. Without proper support, they can easily burn out.

Research shows several major factors linked to turnover. The first is staff shortages. When not enough staff are on-site, that means the employees who are available must pick up the slack and do the heavy lifting — which can result in a stressful, exhausting workload, especially when patients’ health hangs in the balance.

Next is scheduling problems. Employees have strong preferences for when, where, and how much they work. If scheduling is done without taking these into account, workers may feel their expectations aren’t being met and look for positions that better suit their needs. Finally, there’s lack of control over work. When staff feel they don’t have any agency over workplace procedures, they may quickly become alienated. Not playing a role in the decision-making process leads to a sense of frustration.

Turnover isn’t just about employees, though; it’s a huge burden on employers.

How It Costs You: The Three Cs

Employee turnover comes at a steep cost to long-term care providers, in both direct and indirect ways. Chief among them are what we’ll call the Three Cs: cost (meaning direct financial cost and time cost), coverage, and compliance.

Cost

In any U.S. industry, the direct monetary cost of turnover is high. Turnover costs American businesses over $25 billion on an annual basis, and the per-worker cost of turnover is estimated at about 20 percent of the worker’s yearly salary. The long-term care sector is no exception: The cost of replacing a nursing assistant or home care worker is estimated at over $2,000.

If one-half to two-thirds of your staff are regularly leaving, and you’re spending more than $2,000 in replacing each of them, that’s enough to put a dangerous dent in any facility’s budget. And on top of the financial cost, there’s the taxing time cost. Hiring, onboarding, training, and tracking new employees is an extremely time-consuming process. All the time spent on those obligations could instead be devoted to patients’ well-being and other core responsibilities of your operation.

Coverage

Coverage may be the single most decisive factor at any skilled nursing facility. Ensuring that there are enough staff members to fill shifts and address residents’ needs is vital to proper patient care. High turnover creates massive coverage issues. When employees leave on short notice, the remaining workers are stretched thin to cover the gaps — and some patients may not receive the full support they require. The resulting stress and fatigue can then lead to further turnover. It’s a vicious cycle.

According to one study, increasing the number of aides per resident from 33 to 41 per 100 reduced Certified Nursing Assistant turnover from 65 to 41 percent. That stat just goes to show how much of a difference adequate coverage can make. When you have a healthy number of employees at your facility, staff morale improves and patients benefit, but when turnover escalates, overwork sets in and both parties suffer the consequences.

Compliance

The Centers for Medicare & Medicaid Services (CMS) regulates and evaluates long- term care facilities throughout the country with its Five-Star Quality Rating System. Staffing is a critical part of that equation. In 2019, CMS announced that it was “setting higher thresholds and evidence-based standards for nursing homes’ staffing levels.” Why? Because “nurse staffing has the greatest impact on the quality of care nursing homes deliver.”

Especially in light of this heightened scrutiny, employee turnover — and subsequent staff shortages or lack of qualified staff — can put your facility at serious risk of falling out of compliance with CMS standards. And a lowered Star Rating can affect your reputation and revenue far into the future.

For all these reasons, high turnover is a pressing obstacle that must be overcome. The good news is that there are a variety of approaches you can put into action to retain your care workers and enable them to flourish.

Attendance on Demand offers leading workforce management solutions for your organization. Learn more and request a demo today at attendanceondemand.com.

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