The 4 Challenges of Healthcare Talent

Management

 Eightfold
If the world learned one lesson in 2020, it’s how essential healthcare workers are. We
think it’s important now to celebrate the people on the front lines of the COVID-19
crisis — and to think about what healthcare talent management will look like in a
post-coronavirus America.

When the world recovers from the crisis, previous trends in healthcare will return to
the fore. Those include how patient numbers are increasing, how required
worker skill sets are changing, how digital processes are reshaping operational
requirements, and how boosting wages to attract the best employees isn’t a
sustainable option for many healthcare businesses, particularly hospitals. 

The healthcare sector was and will again be ripe for a hiring overhaul and eager for
innovation.

Let’s take a look at four factors affecting recruiting, hiring, and retention in
healthcare — and how healthcare companies can refine their strategies to meet
these challenges.

1. The Healthcare Labor Force Is Changing

Patient-centric approaches to care delivery that focus on value-based outcomes,
evolving consumer expectations, new roles, new tech, new skills — these are just
some of the trends reshaping the healthcare labor market. 

Amy Laverock, partner at Mercer Marsh Benefits, says new ways of working, new
innovations, and the necessary experimentation needed for healthcare companies to
keep pace forces employers to rethink whom and how they hire.

Laverock notes that the future healthcare worker will need to be digitally skilled and
adaptable to working in non-traditional healthcare locations — e.g. in patients’
homes. The shift to patient-centric service delivery also means healthcare roles will
broaden to include social workers, population health managers, and nutritionists and
behavioral health practitioners under the healthcare umbrella. 

Another pressing concern is related to cutting-edge research in genomics and

behavioral science. These new areas of scientific discovery make it difficult to know
how to prepare the talent pipeline within an organization, Laverock argues. Skills that
don’t exist yet will need to be developed to manage roles that are still to be created.

Hiring managers will need to be prepared for the unknown, and that requires a robust
talent acquisition and management strategy, explains Tricia Jessee, a consultant at
ClearPoint Strategy.

Workforce planning is one of the best preemptive actions healthcare business

owners and hospital management can take to safeguard against these future
changes. Inadequate staffing ultimately will result in substandard care.

Further, healthcare companies will always have to compete for the best latent.
According to a Modern Healthcare CEO Power Panel survey, 58 percent of CEOs cite
that competition as a pressing challenge, says Tara Bannow at Modern Healthcare. 

In fact, competition for talent was the CEOs’ No. 2 concern, ahead of even regulation
and reimbursement (i.e. getting paid fairly and on time). Hiring and retention are top-
of-mind challenges for most healthcare executives today.

Their No. 1 concern was rising costs, which makes even more sense in light of the
next point.

2. Healthcare Operating Margins Are Tight

Optum’s 2018 Almanac of Hospital Financial and Operating Indicators show that the
median operating margin U.S hospitals was 0.46 percent in 2016. Hospitals with the
highest margins were at 4.9 percent. 

Matt Wolf at The Real Economy Blog argues that most hospitals have profit margins
that are too small to support double-digit wage increases. Wolf cites Optum’s
2018 Almanac, which shows the vast majority of U.S hospitals have profit margins of
well less than 5 percent.

Meanwhile, hiring managers in healthcare are competing for talent against S&P 500
companies with operating margins of 13.25 percent, Wolf explains. Those
companies simply have more money available to invest in workers.

So, healthcare needs to compete for talent on different terms. One solution is to
become a mission-driven provider that educates the local workforce in the
community to join the mission. The positive here is that healthcare operators and the
community they work in tend to have more positive relationships, which is good for
employees and patients.

3. In the Long Run, Healthcare Employees Will Travel For

Better Opportunities
As with most industries, pay matters to healthcare employees. While surgeons tend
to be the highest paid, nurses are often on the other end of the pay spectrum. 

Carole Jakucs at Nurse.com points to a 2018 survey that shows nurses in the U.S.
are eager to relocate from rural areas in the prospect of higher pay. Pay varies widely
between states, so it acts as a strong incentive to move. However, many nurses also
said they wanted to relocate to further their careers by taking on senior or
administrative roles. 

Healthcare workers also want to know that the work they’re doing is contributing to
positive change. Of course, they’re already helping patients. But Amy Allen at Blum
Shapiro says organizations can build up their good citizenship reputation by giving
back to their community at large. Organizations should not let the lack of financial
resources deter them. Allen says even small organizations can launch volunteer
programs and other giving opportunities to attract candidates and help the
community.

Pharmaceutical firm AbbVie is a good example of a company focused on providing

employees with a sense of purpose. As a first step, the organization reached out to
its 30,000 employees and simply asked what mattered to them and what makes
them proud to work for AbbVie. 
In doing so, the company identified three core principles, Tim Richmond, EVP and
CHRO, tells Ed Frauenheim at Fortune. Those are transforming lives, acting with
integrity, and driving innovation. “It’s more important than ever for us to be able to
answer the questions: ‘What do we believe in? What do we stand for as a company?’”
Richmond says. 

That kind of introspection is valuable to healthcare employers. It’s precisely this kind
of work that landed AbbVie on Fortune’s Best Workplaces in Biopharma list in 2019.

4. Healthcare Needs Better Talent Acquisition Strategies

According to a survey from The Predictive Index, only four in 10 healthcare
executives have a talent strategy in place. The Predictive Index’s Victoria Nichol says
that the positive takeaway is that healthcare execs are scoring higher than
colleagues in many other industries. Yet worryingly, only 17 percent of them say their
talent strategy is aligned with their business strategy. Even fewer, 12 percent, have
the talent in house to execute their business strategy.

Business strategy is not much good if it is not aligned with a considered plan of
hiring and nurturing the people required to execute it. More needs to be done to align
talent and business strategies if healthcare businesses are to thrive. 

Overcoming Hiring Challenges With Artificial Intelligence

As virtually every sector in the U.S. economy, healthcare has suffered from biased
hiring practices, researchers Elena Butler and Shreya Kangovi write at Harvard
Business Review.

Instead of focusing on the diverse traits that the healthcare sector needs to deliver
favorable patient outcomes, hiring managers have continued to be led by traditional
biases of hiring people with elite training and credentials. However, patients need
more than credentialed care. They need social support, guidance on lifestyle and
diet, and healthcare professionals who can build strong relationships with them. 

Employers that focus on hiring people from diverse backgrounds will help to create a
team better calibrated to the varied needs of diverse patients. Employers should be
building teams that are medically knowledgeable but also empathetic and culturally
sensitive to colleagues and patients.  

Butler and Kangovi write that redesigning hiring practices can help to source high-
performing people who may have otherwise been overlooked because of traditional
recruitment practices. 

At the same time, hiring in healthcare often struggles with something more
fundamental than candidate selection. For many companies, simply filling a vacancy
can take months because of inefficient HR tools. According to the ASPR Physician
Recruitment Benchmarking Report, most health organizations report that it takes
them more than six months to recruit and hire a physician. The report found that
having an effective applicant tracking system measurably sped up the hiring
process.

Faster time to hire is a key imperative for many healthcare hiring managers. But they
also want to choose the best people, people who come from diverse backgrounds, to
help grow the organization. Being able to load up talent pipelines, eliminate hiring
biases, and match the best people to the role is what should drive any effective
talent acquisition and management strategy.
#1: The Aging Population Will Increasingly Impact
the Healthcare Talent Landscape
The aging population’s increased healthcare needs will put a strain on workforce resources.
Recruiters and hiring managers will need to ramp up their recruiting efforts and ensure
candidates possess the proper clinical and behavioral competencies required to care for the
senior population. Additionally, as our population ages, more workers will retire. As such,
healthcare professionals must focus on strategic succession planning and competency
development to offset the loss of expertise from the exiting workforce.

#2: Accelerated Market Consolidation Across the

Continuum of Care
This year we’ll see more hospitals merge to create larger health systems. Healthcare HR
leaders will need to develop stronger recruiting strategies to effectively attract and hire
candidates at a larger volume than ever before. The demand for more, and better talent will
cause HR professionals to adopt technologies that can provide efficiencies in the recruiting
and hiring process.

#3: Consumerization Will Take Center Stage

The lines between businesses and consumers are blurring. Job seekers and recruiters are
increasingly opting for technology that is sleek and simple to use. Moving forward, we’ll see
more organizations upgrading their applicant tracking systems and job boards to streamline
processes for candidates as well as recruiters and hiring managers.

#4: Hospitals Will Face Increasing Competition from

Retail Establishments
Expect to see an increasing amount of urgent care retail clinics throughout the year, creating
more talent competition for hospitals, senior living facilities, and other healthcare providers.
Healthcare organizations will need to focus on hiring for retention and improving employee
engagement strategies to keep existing talent that might be interested in competitors’
positions.

#5: Healthcare Workers Will Need Enhanced

Skillsets to Respond to Emerging Methods of Care
Such as Telemedicine
Digital methods of care will continue to emerge throughout 2019. As such, healthcare
organizations must hire talent with — or train existing employees on — the appropriate skills
needed to provide care remotely. This will change the way recruiters source and vet
candidates, as well as how managers train and develop employees’ clinical and behavioral
skills.