NEWMARK

Healthcare Labor Shortages Aren’t New, But This Lawsuit Is

Commentary by Todd Perman, CCIM, Vice Chairman, Global Healthcare Services


Healthcare staffing issues have become common in the wake of the pandemic. Hospitals continue to see staffing shortages: both short-term shortages due to COVID-19 exposure, the ensuing isolation, and long-term shortages created by resignations due to burn-out and workers opting for alternative workplaces with more attractive salaries and schedules.


In January, one hospital made an extraordinary move to attempt to stop a group of its employees from leaving their jobs for another nearby hospital. The unprecedented tactic: a restraining order.


Wisconsin health system ThedaCare argued the restraining order was necessary to give the system time to create a staffing plan to replace the workers who were leaving. A judge initially granted the order, but ultimately lifted it, allowing the workers to join Ascension Northeast Wisconsin. ThedaCare’s desperate act demonstrates the increasing fallout from staffing shortages within the healthcare industry.


While the demand for qualified healthcare workers—specifically nurses—have been significant since the start of the pandemic, the supply has remained generally the same. This imbalance gives healthcare workers the power to seek ideal positions, many of which include less acute settings and lucrative short-term travel nursing positions. These travel positions have a very elastic supply, as studied in the Becker Friedman Institute’s whitepaper: When Nurses Travel: Labor Supply Elasticity During COVID-19 Surges.


We anticipate sustained medical labor market concerns as the healthcare landscape attempts to stabilize from peak pandemic-related outcomes. Hospitals and health systems will likely pursue creative, flexible solutions to achieve their ultimate goal of best serving their patients and communities.


More information on the ThedaCare lawsuit can be found here.

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