Nursing Workforce

Graham DyerCEO Wairarapa and Hutt Valley DHB’s

Board Member HWNZChair ERSG

The aging population

• Between 2001 and 2021, the number of over 65’s will increase from 461k to 729k

• This is an increase of 72% vs a popn increase of 16%

NZIER (2005) NZ Population Projections by Age Cohort(Assuming medium population growth)

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,0000-

4

5-9

10-1

4

15-1

9

20-2

4

25-2

9

30-3

4

35-3

9

40-4

4

45-4

9

50-5

4

55-5

9

60-6

4

65-6

9

70-7

4

75-7

9

80-8

4

85-8

9

90+

2001 2011 2021

Health Spend and GDP

• Difficult to find detailed cost estimates of the gap between forecast GDP and forecast demand

• Rough calculation – 2.1bn issue from impact of over 65’s alone

Nursing Council / BERL

Economic Model - Porter

New Entrants

Substitutes

Demand of Population

Supply of Nurses

Efficiency &

Price

Questions

1. What needs to be done to have enough nurses in the medium term?

2. What are the factors that need to be taken into account for retention of the workforce?

3. What are the roles that nurses could/should be doing in the future that are not being done now?

4. What is the role of other professional groups in the space that nurses now occupy?

Addressing the New EntrantsHutt Valley DHB

• 1400 graduates, 500 placed by ACE scheme

• Hutt Valley Hospital– Normally takes 22 graduates– Only taking 9 in 2013/14– Largely due to low vacancies, reduced turnover,

and relative ease of employing qualified nurses

Long term vs short term

• Approach does not address future needs

• HVDHB Goals for New Graduates:– Create a continuous and predictable ‘pipeline’ of

new talent;– Demonstrate our professional commitment to

these nurses; and– Reduces overall nurse workforce costs.

Background Information• A nurses’ wages range from $47,057 (new grad) to $63,528 (Step

5). • Currently the average cost at Hutt is $62,054. • With loading for leave and training cover, this ranges from

$61,036 to $75,344 • Health Workforce NZ pays the DHBs $7,200 for each new graduate

in a NETP program• There are a number of costs associated with each new graduate

employed in the first year, including:– supernumerary (non-productive) time, – study requirement and support and – HWNZ reporting and compliance costs.

Average cost per Nurse FTE

New Graduate Nurse Costs vs Current Avge Cost

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

Year 1 Year 2 Year 3 Year 4 Year 5New Grad Current Avge Nurse $

Analysis

• The benefits to the organisation include:– In Year One, the cost of a new grad is 80% of the

current staff– By replacing nursing vacancies with the 22 new

grads every year, the total savings will be $314,776 in year one and cumulative yearly

Risks and MitigationsRisks Score MitigationsEmployment of new graduates places the cost centres above their budgeted 13/14 FTEs

H • Unlikely - current turnover is 14%• Use ‘surplus’ FTE to further

manage each cost centre’s accrued annual leave balance

• Monthly reporting and tracking of actual FTEs and forward planed rostered leave

• Hold vacancies and use either casuals or allocation staff (via the Op Centre) as an interim

New graduate to exiting FTE ratio may ‘tip’ the units skill-mix

M Balance new graduate nurse numbers against non –NG FTEs to minimise risk

Burden for existing workforce burden of managing orientation and student numbers

L • Continue to use PDU resources to support the team

• Ensure rostering of preceptors promotes continuity

Conclusions

• We do have looming Nurse workforce challenges

• We will need to look at increasing supply of nurses or developing substitutes

• There are immediate as well as medium term benefits in taking on graduates, as long as there is active management of the process.