Healthy outcomes Featured

8:00pm EDT June 25, 2007

When Barry Arbuckle decided to tackle the biggest problem facing his organization, he didn’t try to come up with all the answers himself.

Instead, he put together a team to help him navigate through assessing the problem and crafting a solution.

Arbuckle, president and CEO of MemorialCare Medical Centers, relies on a team-based approach when it comes to moving the $1.4 billion health system forward.

It was just such an approach that helped him deal with a huge problem at MemorialCare: how to deal with a critical shortage of nurses.

MemorialCare employs more than 2,000 nurses, but there’s a nursing shortage and California ranks dead last in nurses per capita.

“We have vacancy rates that are in the 12 percent to 15 percent range, so we have many positions open all the time,” says Arbuckle.

Trying to operate a hospital system such as MemorialCare without enough nurses in-house poses a financial drain. Most units have to be staffed no matter what, so the only remedy is to use expensive, agency-supplied nurses, who can command a salary premium of up to 50 percent more than what a staff nurse makes.

“Without a doubt, it affects our competitive position in the marketplace,” says Arbuckle.

The team approach

Arbuckle started by putting one of his senior people in charge of gathering a team of experts who had the skills and experience that would help them get through some of the potential bumps in the road.

“Usually, you assign one key person, have them collect the data, figure out what the real problem is, and if it is a problem they believe will be long-lasting,” says Arbuckle. “If not, and it’s going to require a significant investment, it may not be worth pursuing; it may be a Band-Aid. We had one of our most senior people leading the charge, and then he had two or three people working with him who were content experts that helped to navigate some of the obstacles that came up along the way.”

At that point, the issue is brought through the senior management team, which meets monthly for several hours on issues that have systemwide implications that are strategic in nature.

“The team will ask questions and talk about the pros and cons, and also about how it might be prioritized with the host of other projects we might have on our plate,” says Arbuckle. “Then they send that senior person back to do more research, ask more questions and connect with more people. So it’s very much an iterative process in that regard.”

At the point where the concept is reasonably mature and some hard numbers are available, the governing board takes a look at it.

“We ask, ‘What’s your reaction to this kind of thing, here’s the magnitude, here’s why we’re doing it, here’s why we think it’s important,’ that kind of thing,” says Arbuckle. “They will typically ask questions and send us back to pursue answers to their questions.”

As Arbuckle and his team delved into the nursing shortage problem and how it might be solved, they encountered an interesting conundrum: The nursing shortage wasn’t due to of a lack of interest in the profession but to a lack of capacity to train new nurses.

In a discussion with the then-president of California State University at Long Beach, Arbuckle discovered that while California and the country in general were suffering from a shortage of nurses, schools had little incentive to ramp up nurse-training efforts.

Nursing programs were costly, universities had trouble finding qualified faculty, and it was simply more cost-efficient to focus on other degree programs.

“You have to have laboratory space and space where they can get on-site training,” says Arbuckle. “This was causing universities and colleges to pull back, reducing the size of their nursing programs, in spite of the fact that we had a shortage of unprecedented magnitude of nurses, not only in California but nationwide.”

There are a number of prospective nursing students but no place to train them. At Cal State Long Beach, for instance, there are only 70 spots each year for about 470 applicants to the bachelor’s degree in nursing program. And any student not admitted two years in a row loses eligibility to enter the program altogether.

Solving problems

The next step Arbuckle’s team took was to find a way around the problem. It could either try to find nurses from the existing work force or do something to increase the size of the work force.

“You can do tried-and-true, where it’s warfare, where you up the salaries or fundamentally change the benefits in a way that makes you significantly different,” says Arbuckle.

But the team rejected that approach because it just runs up costs without solving the problem.

“That’s been done for decades, but it’s got a ceiling at some point, and it can be disadvantageous to a business because you get into a wage war that really does not benefit anyone.,” he says. “That happened in the last shortage back in the 1980s.”

The other option was to train nurses at MemorialCare. Like most hospitals, it had done the typical cooperative ventures with learning institutions to train nurses. But after analyzing the cost data, Arbuckle’s team found that putting together a training program in which the health system provided the clinical faculty and lab space, both in short supply at universities, gave MemorialCare some distinct competitive advantages. It also served as a way to retain talent already in the organization.

To forecast what its future work force needs would be, MemorialCare surveys its older workers to gauge how long they might be planning to remain in the workplace. In many cases, members of this group were approaching the last five or 10 years of their careers in a physically demanding profession.

“These folks were saying, ‘I don’t know how much longer I can do this,’” Arbuckle says. “I may not retire from employment, but I cannot continue to do this. I didn’t know they had those thoughts on their minds until we began asking.

“So when we surveyed folks in our organization who are over 55 to find out what are your thoughts, how much longer will you work, and what would cause you to reduce your hours or quit entirely, we found it was the demanding nature of the job.”

The team created a solution that solved both problems. By taking the experienced nurses and making them the teachers in the new program, Arbuckle got the faculty he needed to train new nurses.

“We were able to begin to educate our own, using our own people, which has a wonderful side benefit because it’s rejuvenated these people’s careers, because typically at that level, if they have a master’s degree, they have been working for us for 10, 15 or maybe 25 or 30 years, maybe even getting a little bit burned out with everyday clinical activity,” Arbuckle says. “All of a sudden, they become faculty for a whole new generation of nurses. Talk about rejuvenating your work force. It was completely unanticipated but one of the greatest benefits.

“They’re nurses with master’s degrees that may be full-time clinicians or managers, but because they have master’s degrees, they’re eligible to be full-time faculty with a stroke of the pen. And I’ve got training sites and I’ve got a great need.”

The program they teach is helping generate the skilled work force MemorialCare needs to fuel its growth.

“We’ve found a way to give them educational opportunities and even bind them to us so we don’t lose them,” says Arbuckle. “I’ve got first opportunity to go to them and say, ‘I’ll pay all of your tuition and book expenses if you agree to work for me for two years.’ The presumption is that if they’ve worked for us for two years, they’ve become ingrained in our culture.

“I’ve had 80 percent sign those kinds of commitments. For me, it has a very quick return on investment because the cost of temporary labor is extraordinary.”

Arbuckle’s solution, although it hasn’t completely solved the nursing shortage in a state where the problem is among the most challenging, has been successful enough to prompt him to propose doubling the effort.

Arbuckle calculates that the program, done in conjunction with California State University since 2004, will save the health system $45 million in labor costs during the next two to three years.

Arbuckle says that when you are implementing a major initiative like this, you have to have the right people, the right information and the right attitude, particularly on the CEO’s part.

Says Arbuckle: “I appointed people who were skilled in the area to run with it. And you have to be passionate about it. When it’s at this magnitude and it’s this new, if you’re not passionate about it, people will sense that, and it will never get off the ground.”

HOW TO REACH: MemorialCare Medical Centers,