JNPD
Nurse Residency Programs Column Editor: Jim Hansen, MSN, RN-BC
The Financial Case for Nurse Residency Programs, Part 3
I
n the years since the economic downturn, the U.S. healthcare industry has worked hard to acclimate to a ‘‘new normal’’ financial climate of greater efficiency and quality. Nursing professional development departments need to concisely show how they directly align with organizational strategy so they can justify the services they provide to the organization, and/or advocate for more financial or human resources (Association for Nursing Professional Development, 2013). Nursing professional development programs like nurse residency programs (NRPs) are powerful and effective ways to bring new nurses into an organization, and the value implication for NRPs is simple: if the NRP saves the organization more money than it costs to develop and run, then it pays for itself and shows a positive return on investment (ROI) for the organization. In prior columns, we discussed how to project a cost savings from reducing new graduate turnover and figure the planning, implementation, and evaluation costs of running a professional development program like an NRP. This column builds on that information, showing how to calculate an ROI. With knowledge of the costs of financing the new graduate turnover in an organization and the costs incurred with planning and implementing an NRP, it is time to calculate the savings of the reduced turnover compared with the costs. Ideally, the cost savings from a reduced turnover will exceed the costs of the NRP and save the organization money.
CALCULATING ROI FOR A NEW NRP You begin by adding the NRP planning and implementation costs together to get the total cost for the program for the first year. Then, determine the costs in dollars that the organization currently pays to finance its nursing turnover. Then, estimate how much the NRP can reduce the turnover in the organization. Know that organizations do not reduce and consistently maintain their turnover at zero. There are always Jim Hansen, MSN, RN-BC, Executive Director, The Nurse Residency Partnership, Post Falls, Idaho. The author has disclosed that he has no significant relationships with, or financial interest in, any commercial companies pertaining to this article. ADDRESS FOR CORRESPONDENCE: Jim Hansen, MSN, RN-BC, The Nurse Residency Partnership, 3581 E 1st Ave, Post Falls, ID 83814 (e
Nurse Residency Programs Column Editor: Jim Hansen, MSN, RN-BC
The Financial Case for Nurse Residency Programs, Part 3
I
n the years since the economic downturn, the U.S. healthcare industry has worked hard to acclimate to a ‘‘new normal’’ financial climate of greater efficiency and quality. Nursing professional development departments need to concisely show how they directly align with organizational strategy so they can justify the services they provide to the organization, and/or advocate for more financial or human resources (Association for Nursing Professional Development, 2013). Nursing professional development programs like nurse residency programs (NRPs) are powerful and effective ways to bring new nurses into an organization, and the value implication for NRPs is simple: if the NRP saves the organization more money than it costs to develop and run, then it pays for itself and shows a positive return on investment (ROI) for the organization. In prior columns, we discussed how to project a cost savings from reducing new graduate turnover and figure the planning, implementation, and evaluation costs of running a professional development program like an NRP. This column builds on that information, showing how to calculate an ROI. With knowledge of the costs of financing the new graduate turnover in an organization and the costs incurred with planning and implementing an NRP, it is time to calculate the savings of the reduced turnover compared with the costs. Ideally, the cost savings from a reduced turnover will exceed the costs of the NRP and save the organization money.
CALCULATING ROI FOR A NEW NRP You begin by adding the NRP planning and implementation costs together to get the total cost for the program for the first year. Then, determine the costs in dollars that the organization currently pays to finance its nursing turnover. Then, estimate how much the NRP can reduce the turnover in the organization. Know that organizations do not reduce and consistently maintain their turnover at zero. There are always Jim Hansen, MSN, RN-BC, Executive Director, The Nurse Residency Partnership, Post Falls, Idaho. The author has disclosed that he has no significant relationships with, or financial interest in, any commercial companies pertaining to this article. ADDRESS FOR CORRESPONDENCE: Jim Hansen, MSN, RN-BC, The Nurse Residency Partnership, 3581 E 1st Ave, Post Falls, ID 83814 (e
