Prior to the outbreak of the Covid-19 pandemic, hospitals nationwide were facing a shortage of nurses. After more than a year fighting the pandemic on the front lines, many nurses are burnt out — placing further strains on clinical staffing.

Troy Villarreal, president of HCA Houston Healthcare, has seen the shortage firsthand across HCA’s hospital locations in the Houston region, Corpus Christi and the Rio Grande Valley. During the height of the pandemic in the summer of 2020, nurses were being recruited from HCA to work as contract nurses being paid high rates to travel to hotspots severely impacted by the Covid-19 pandemic. Many of those workers have returned to their local markets, but they’re not necessarily coming back to work.

Some did so well financially traveling to hotspots, they’re taking time away from health care work, Villarreal said. Others are waiting until kids return to school in the fall.

Many are tired and need a break from the stresses of the pandemic, which is continuing after more than a year. More recently, Houston health care leaders are warning of a potential fourth wave of coronavirus-related hospitalizations as the delta variant spreads locally. Health leaders from the Texas Medical Center and major Houston-based hospital systems are citing a recent rise in coronavirus patients being hospitalized, particularly patients who have not been vaccinated for Covid-19. Daily Covid-19 hospitalizations in the TMC hospitals jumped more than 100% in two weeks, from 70 hospitalizations on July 11 to 150 on July 25, per TMC data.

“That has elevated the rates in the market right now,” Villarreal said. “All the health systems, all the businesses are having to pay more because supply of workers just isn’t there for whatever reason.”

From a hiring perspective, nurses and other patient-facing employees are HCA Houston Healthcare’s biggest growth engine right now, Villarreal said. The company is tapping into local schools and universities to source talent. Last year, HCA Houston Healthcare broke ground on the HCA Healthcare Center for Clinical Advancement, a training center for the division’s approximately 7,000 nurses.

Memorial Hermann Health System has seen similar shortages of nurses, respiratory therapists, occupational therapists and other health workers, said President and CEO Dr. David Callender. The problem existed before Covid-19, but superimposing the pandemic on top of existing shortages didn’t help matters. At this point in the pandemic, some more experienced health care staff are choosing to exit the profession and retire early, he said.

“Certainly there’s an impact on expenses relative to the shortages of health care professionals,” Callender said. “We worry about that as we go forward — the supply and the cost of the overall labor. Because demand is so high, it drives up the cost of labor.”

Paying more

During the height of the pandemic last year, nurses from around the nation were paid extremely high rates to travel to Covid-19 hotspots, where providers were plagued with staff shortages and a lack of personal protective equipment. With rates as high as $120 an hour, plus overtime, housing and per diem costs, the pay traveling nurses received during the pandemic was “life-changing” money, said Ruth Bustos, director of client services for Houston-based UltraStaff and a registered nurse herself. Bustos traveled to work as an RN in New York City last year as that city battled on the front lines with the coronavirus pandemic.

“I saw it as an opportunity — not just the money, but also to help me in my profession,” Bustos said. “Something to help out during the pandemic, to learn.”

Rates have come down significantly since the height of the pandemic, Bustos said. Traveling nurses can now make around $70 an hour, and many providers have nixed overtime pay at this point, she said. Meanwhile, the starting salary of a newly graduated RN in Houston typically ranges between $25 and $31 per hour, according to PRI data.

But $70 an hour is now roughly the benchmark of where employers have to offer to be able to attract nursing staff. If providers are offering less, some nurses are choosing to hold out for the next traveling gig.

“If an RN can make $70 an hour right now on a travel assignment with all expenses paid, that’s more than a nurse practitioner can make,” said Jolyn Scheirman, president of Houston-based Physicians Resources Inc. and UltraStaff. “You see why the nurses aren’t coming back to the facilities, the nurses who actually enjoy this travel type of life.”

It’s not just rates for registered nurses and nurse practitioners that have increased. The rates for physicians, medical assistants, pharmacists, paramedics and emergency medical technicians have all increased over the course of the pandemic, said Rebecca Orzabal, director of operations for Physicians Resources Inc. and a licensed vocational nurse. Amid the shortage of nurses and the high rates to pay them, other medical professionals are seeing higher levels of utilization to do nursing tasks, leading to high demand.

“We’re doing heavy recruitment for pediatricians, urgent care, family practice, internal medicine,” Orzabal said. “It’s just ongoing with us at Physicians Resources.”

After spiking during the height of the pandemic last year, rates have leveled off some for patient-facing health care workers. But overall, costs are up for providers, which means costs will go up for taxpayers and private insurances.

“It is our supposition that the rates will still be higher than they were pre-pandemic,” Scheirman said. “Meaning the hospitals are going to have to pay more, and all of us are going to have to pay more than we did pre-pandemic.”

Impediments to hiring

Economists have suggested a number of different reasons why workers in Texas, including health care workers, are not returning en masse to pre-pandemic levels of employment at this point in the recovery. Demands for higher pay have certainly caused some workers to hold out on accepting positions, according to data from the Federal Reserve Bank of Dallas’ Texas Business Outlook Surveys. Over a third of employers have cited applicants seeking more pay than being offered as an impediment or hiring or recalling workers.

Continued fear of exposure to Covid-19 in the workplace is another barrier to work re-entry. Data from an Envoy return-to-work survey show that more than half of respondents expressed some level of concern about the virus when returning to the workplace.

It’s not just nurses and other patient-facing, clinical workers that are seeing shortages right now. Keith Wolf, managing director at Houston-based staffing firm Murray Resources, said that health care administrative, accounting support, IT, medical billing and other ancillary roles within health care are in high demand.

The staffing business can fluctuate between periods of having too many open jobs and not enough workers and periods of too many workers and not enough open jobs. Houston is currently in the former situation, Wolf said, and the demand for workers in Houston is the hottest the market has been in his 10 years in the industry.

“The Houston market is so hot that we are now, for the first time in our company’s history, looking at remote recruiters outside of the Houston market to help fill the gap,” Wolf said.

Outside of health care, there’s high demand for salespeople, IT staff, engineers and more, Wolf said. Murray Resources’ job count is up 85% in the last 90 days compared to the same period last year.

Murray Resources is seeing higher wages across the board, too. One candidate received a $60,000 salary offer, which was countered by their current employer for $100,000 annually. Another candidate making $110,000 annually was given a blank check to write his own salary from the hiring company. If they accept, their salary will bump up to $150,000 a year with generous benefits. Companies are offering things like remote and hybrid work accommodations and signing bonuses to be competitive in the tight labor market.

In the meantime, Houston’s health care industry is dealing with the compiled impacts of an existing labor shortage and the severe occupational stresses of the Covid-19 pandemic on clinical staff.

“We know that we have these shortages, and it’s going to be hard to do much about them to rapidly increase the pipeline of people coming into these professions,” Callender said. “So what do we need to do differently going forward? We’re all concerned about that.”