The Economic Standard: Cap on Travel Nurse Pay Is Bad for Patients

Travel nursing has become a booming industry across America in the wake of the COVID-19 pandemic. While hospitals struggle with staff retention, a growing number of nurses are turning their skills into the travel nursing industry to meet its growing demand. There is now an estimated number of 50,000 travel nurses in the U.S., though these numbers continue to rise as nurses are drawn by the promise of increased pay and new work environments.

In recent years, there has been a healthcare provider shortage in the United States, particularly in primary healthcare, making delivering quality care to patients more difficult. Fortunately, the booming travel nurse industry has helped fill this need, improving health outcomes for patients across the U.S. Despite this, many critics believe that travel nurses may be exploiting the pandemic by demanding what some claim as unreasonable payment demands. Prior to the pandemic, hospital nurses earned on average $1,400 per week, while travel nurses now can be paid between $5,000 and $10,000 per week.

In January 2022, Representative Morgan Griffith of Virginia and Peter Welch of Vermont, along with 200 House members, wrote a letter to the Biden Administration arguing that the high pay rates for travel nursing are endangering patient safety due to their unmanageably high pay rates. Last year, the American Hospital Association (AHA) wrote to the Federal Trade Commission (FTC) asking the agency to investigate travel nurses whom they believed were “charging supercompetitive prices to desperate hospitals.” This behavior, the AHA alleged, amounted to “anticompetitive and unfair practices.”

There has been an extraordinary disturbance as hospital nursing staff quit their positions to partake in travel nurse contracting. However, the government, and critics of this booming industry, must acknowledge that capping travel nurse salaries is a terrible idea. Critics fail to realize that travel nurses are merely supplying a service that is in huge demand, and capping travel nurse salaries puts access to these services at a high risk, particularly those living in rural communities.

Unlike traditional nurses who typically stay at one healthcare facility, travel nurses are often temporarily placed in rural hospitals with fewer resources and greater staffing shortages. Consequently, they can demand substantially higher pay because they must accept a more challenging work environment. Without access to nurses who are willing to accept more complex assignments, rural hospitals will be denied access to staff who can deliver important care to patients.

However, the argument to support the growing travel nurse industry is incomplete if we first don’t acknowledge the hard truth to why thousands of nurses are fleeing hospitals in the first place. Many nurses explain that the mass exit of nurses from hospital staff could have been avoided by providing these in-hospital nurses with better pay and improved working conditions. In addition, career satisfaction among nurses was at an all-time low throughout the pandemic as just 32% of nurses surveyed said they are very satisfied with their occupation, compared to an earlier 52% pre-pandemic.

While traditional nurses reported low job satisfaction, a study in California revealed that travel nurses are consistently happier in the work they undertake. Recognizing this is important because any efforts to rein in the pay of travel nurses could force thousands into traditional roles they do not wish to undertake or out of the profession completely, further exacerbating staffing shortages, particularly in rural areas.

Poor hospital retention rates undoubtedly impact patient outcomes. For example, one study in 2014 revealed that for every one patient increase in a nurse’s workload, the likelihood of a patient dying increases by 7%. If not appropriately addressed, hospital nursing shortages may increase patient morbidity and mortality in the hospital system. Meanwhile, as hospitals overflow with COVID-19 patients, travel nurses becomes are critical to keep units fully staffed to maintain better patient health outcomes. It’s understandable how this creates tension within the hospital when full-time nurses are privy to the salaries of these traveling nurses.

While capping travel nurses’ pay might seem an attractive option when health costs are rapidly increasing, the reality is that doing so could result in poorer health outcomes for patients and thousands of nurses forced into roles that have rapidly declining rates of job satisfaction. Rather than imposing caps on how much nurses can earn, hospital administrators should probably be asking why nurses are so attracted to travel nursing.

Gabrielle Callwood-Jackson is a Policy Intern at the American Consumer Institute, a nonprofit educational and research organization. For more information about the Institute, visit www.TheAmericanConsumer.org or follow us on Twitter @ConsumerPal

This was published in The Economic Standard.

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