A Hidden Cost of High Turnover in Hospitals and Healthcare Organizations

Kristine Keefer Wolff
Kristine Keefer Wolff
Senior Vice President, Clinical Solutions

The costs of turnover in hospitals and health systems are high. 

According to the 2022 NSI National Healthcare Retention & RN Staffing Report, 

  • The average hospital loses $5.2 to $9 million on RN turnover yearly.
  • The average turnover cost for a staff RN is $46,100, up more than 15 percent from the 2020 average.
  • The average hospital can save $262,300 per year for each percentage point it drops from its RN turnover rate.

The NSI report also found that, in the past five years, the average hospital turned over 100.5 percent of its workforce and 95.7 percent of its RN workforce.

Turnover of hospital leaders has been and continues to be high. There were 101 CEO exits in 2020 and 112 in 2021. CEO turnover, in turn, tends to lead to additional turnover at the executive level. The executive most likely to leave following a CEO departure is:

  • Chief Financial Officer – 34 percent
  • Chief Operating Officer – 34 percent
  • Chief Nursing Officer – 10 percent
  • Chief Medical Officer – 3 percent
  • Chief Human Resources Officer – 2 percent

High Turnover Impacts Patient Outcomes and Safety

A nursing unit turnover study measured the impact on patient outcomes, finding lower turnover reduces safety issues for patients such as falls. Moderate levels of turnover led to lower levels of workgroup learning, which, in turn, influenced the number of severe medication errors and patient satisfaction. Turnover and staffing shortages also impair teamwork, morale and trust on healthcare teams and may lead to unsafe staff-patient ratios that impair productivity and positive outcomes. High turnover also contributes to longer learning curves.

High Turnover Leads to Increased Need for Hospital Leadership Development

The Clinical Solutions team and I, on average, spend the majority of our time each month in hospitals across the country. We’ve noted a hidden cost of high turnover in hospitals – the absence of leadership education among managers and department leaders. I suspect the need for hospital leadership training has been made even more acute due to the COVID-19 pandemic, which reduced the time and necessary resources.

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