Health systems should be careful to avoid misclassification of nurses as independent contractors, according to this law professional.

CNOs everywhere are strategizing how to fill workforce gaps left by the nursing shortage.

While navigating recruitment and staffing challenges, it’s important to look at how nurses will be brought on and integrated into the workforce. Part of this process involves making sure nurses fall under the proper worker classification, and ensuring that the hospital or health system remains in compliance with legal requirements for classification.

While nurses are often classified as full-time employees, some are designated as independent contractors, which depends on several factors, according to Richard Reibstein, head of Locke Lord's New York labor and employment practice and co-head of the firm’s independent contractor compliance and misclassification practice.

"There is no one particular situation where nurses can be legitimately classified as independent contractors," Reibstein said. "Rather, there are many different situations, and the facts are critical in determining if you are in sync with the law or out of compliance and facing IC misclassification liability."

Why independent contractors?

According to Reibstein, a nurse could be classified as an IC if their work is unsupervised or unassigned, they are not told how to perform services, they can determine their own schedule, negotiate their pay, and incur their own expenses.

Other factors include whether the nurse is free to accept or decline engagements and whether they have the right to work with multiple agencies or health systems. However, Reibstein explained, some states have more restrictive law tests for ICs than others.

"What is most important is a state-of-the-art analysis of these and other factors in view of applicable law," Reibstein said. "We look at more than 48 different factors to assess whether a worker is likely to be properly classified."

Reibstein emphasized that there are both upsides and downsides to classifying nurses as ICs, depending on the needs of a health system. The upside for IC classification, according to Reibstein, is that health systems need to worry less about compliance with the applicable federal, state, and municipal labor and employment laws that apply to employees.

However, the downside of IC classification has the potential to impact standards of care delivery.

"The downside is that the health care system engaging a nurse as an independent contractor cannot direct or control the manner in which the nursing services are being performed," Reibstein said, "if direction and control [are] important."

What about misclassification?

It’s critical that CNOs and other healthcare executives ensure that any nurses or clinicians treated as ICs must be classified properly, or there can be steep consequences.

According to Reibstein, health systems can face investigations and litigation in situations where misclassification occurs.  

"They can be subjected to class action lawsuits as well as audits and investigations by state or federal workforce and tax agencies,” Reibstein said, "all leading to considerable legal exposure and liability."

To avoid these issues, Reibstein said health systems should structure their relationships with ICs in a manner that maximizes compliance with the applicable IC laws, and they should strive to meet as many as two or three dozen criteria for IC compliance.

Health systems must also document and implement the IC relationship in a compliant manner, Reibstein explained, and customize the IC relationships to meet their business model and objectives, so that the outcomes are sustainable.

"One-size-fits-all approaches are usually ill-fitting," Reibstein said, "and what may work for one health care system may not work effectively for another."

Workforce concerns go far beyond just recruitment and retention, according to HealthLeaders Exchange members. 

Today's CNOs, CMOs, and other industry leaders are confronting AI, breaking down barriers to entry in education, and cultivating a sense safety in the workplace, all in an effort to create the most sustainable workforce possible. However, this work doesn't come without major challenges.

The 2024 HealthLeaders Workforce Decision Makers Exchange wrapped up last week in Washington D.C. after two days of insightful idea-sharing and compelling discussion about the most difficult obstacles in building a workforce.

Here are three key takeaways that leaders should know about workforce challenges. 

 

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The HealthLeaders Exchange is an executive community for sharing ideas, solutions, and insights. Please join the community at our LinkedIn page. 

To inquire about attending a HealthLeaders Exchange event, email us at exchange@healthleadersmedia.com. 

Recruiting alone won't solve the workforce crisis, according to these leaders.

One of the biggest areas of concern for healthcare executives of all titles is the workforce, and the issues go far beyond recruitment and retention.

Today's CNOs, CMOs, and other industry leaders are confronting AI, breaking down barriers to entry in education, and cultivating a sense safety in the workplace, all in an effort to create the most sustainable workforce possible. However, this work doesn't come without major challenges.

The 2024 HealthLeaders Workforce Decision Makers Exchange wrapped up last week in Washington D.C. after two days of insightful idea-sharing and compelling discussion about the most difficult obstacles in building a workforce. Here's how leaders are tackling the key issues that are keeping them up at night.

Leveraging AI and virtual care

First and foremost, the healthcare industry is facing a workforce shortage, of nurses, physicians, and plenty of other critical positions. However, according to the Exchange members, it's not just about hiring new people.

"We cannot recruit our way out of the workforce crisis," said Chris DeRienzo, MD, chief physician executive at the American Hospital Association (AHA).

Leaders need integrate technologies such as AI and virtual nursing to streamline processes and give clinicians time back at the bedside. However, both of those technologies should be used as assistive tools, not replacements for FTEs.

When it comes to AI, leaders should strive to implement and adopt AI that has a low barrier to entry and can be used by clinicians with varied technological backgrounds. Staff must be included in the development process, and patients should be fully informed and educated on the technology and how it works. Leaders should consider using patient advisory boards to understand the questions and concerns that patients have surrounding AI as well.

For virtual care, specifically in nursing, leaders should consider using metrics such as retention rates, turnover rates, and nurse engagement to measure ROI. The capabilities of virtual care technology stretch far beyond only virtual nursing, and health systems should consider how other departments can leverage the same technology for different purposes.

Cultivating generational wellness

It's also no secret that workforce expectations have changed in recent years, especially since the pandemic. New generations of nurses and physicians want different things and prioritize other types of benefits than previous generations before them. Younger nurses want more flexibility, work-life balance, and with the rising cost of living, more compensation with benefits that suit their needs.

For leaders, according to the Exchange members, it's crucial to let go of some of the more traditional processes and make way for new ones. The idea of flexible scheduling has been gaining traction, especially since the pandemic, as a method of accommodation for the busy lives of nurses at all life stages.

"We have to let go of our expectations and meet people where they are," said Jennifer Garnica, vice president of nursing and chief nursing officer at SSM Health St. Mary's Hospital, St. Louis.

The Exchange members also emphasized the importance of wellness and building a culture of psychological safety, where staff feel comfortable approaching leadership with questions and concerns. Leaders have a responsibility to connect with their employees and build relationships that allow for honest communication and trust.

Building educational pipelines

One of the biggest drivers of the workforce shortage is the lack of clear pathways into the healthcare industry.

According to the Exchange members, this begins with a faculty shortage. The lack of teachers and faculty limits the number of slots available in medical school programs, which in turn limits the number of applicants who can be accepted into the programs. Medical education is also expensive and time consuming, and with stagnating wages, future physicians are wondering whether the profession is worth it.

Leaders must strategize and build better pipelines into the industry, for both physicians and nurses. According to the Exchange members, this involves strong partnerships with academic institutions as well as considering innovative solutions such as tuition reimbursement or assistance, and other incentives for students who are interested in entering the industry. It's also important that leaders keep diversity in mind and build workforces that reflect the communities they serve.

Ultimately, leaders need to keep experimenting with new ways to recruit and retain clinicians, streamline processes, and expand how care is delivered. According to Ronda McKay, vice president of patient care services and chief nursing officer at Powers Health, even if things go wrong, it energizes leaders and staff alike when they can try new things.

"If we don't think it's going to hurt anybody," McKay said, "try it."

See more coverage from the 2024 Workforce Decision Makers Exchange here.

The HealthLeaders Exchange is an executive community for sharing ideas, solutions, and insights. Please join the community at our LinkedIn page. 

To inquire about attending a HealthLeaders Exchange event, email us at exchange@healthleadersmedia.com. 

CNOs and other healthcare executives are strategizing to address recruitment and retention, workplace violence, and virtual nursing challenges, say these nurse leaders.

Nurse leaders have had many challenges to face this year, and CNOs have been brainstorming ideas for addressing the nursing shortage as well as disruptors such as AI and virtual care.

From Nov. 6 to Nov. 8, the members of the HealthLeaders Workforce Decision Makers Exchange will meet in Washington D.C. to discuss critical workforce issues in nursing, and innovative solutions to address recruitment and retention, technology, and workplace violence challenges.

Here are some of the biggest workforce challenges that nurse leaders are facing in 2024, according to Katie Boston Leary, senior vice president of equity and engagement at the American Nurses Association (ANA), Jean Putnam, chief nurse executive at Baptist Health South Florida, and Michele Szkolnicki, senior vice president and chief nursing officer at the Penn State Health Milton S. Hershey Medical Center.

 

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