Breaking It Down: What is the Real Cost of a Travel Nurse?
There are a lot of myths circulating about the cost of travel nurses. Between workplace gossip, blogs and misinformed Web sites, it’s hard to tell what is real and what is an exaggeration. I’ve personally seen articles that state that travel nurses make $75 per hour and that they get fantastic housing benefits that outweigh any benefits that permanent nurses might have. I’ve also heard that nurse staffing firms make up to $50 per hour of the bill rate they charge. Well, as with most things, the truth lies in the middle.
A Travel Nurse is a Travel Nurse, right?
First, let’s break down the term “travel nurse.” Not all travel assignments are alike and therefore, travelers may come in a variety of flavors. These include:
1) Traditional travel nurses – Able to start in 4-8 weeks, contracted for 13 weeks.
2) Rapid response travel nurses – Able to start in 2 days to 2 weeks, contracted for less than 13 weeks, usually 4-6.
3) Strike-breakers – Sometimes referred to as travelers, these nurses are contracted typically for only a few days or weeks for the sole purpose of crossing picket lines of striking nurses.
The categories of travel nurses are often blended together or misunderstood. While a strike-breaker may sometimes work as a traditional travel nurse, that does not necessarily mean that all travel nurses will work as strike-breakers. Likewise, not all travel nurse staffing companies will provide all three types of nurses. Just last week, I was introduced to a nursing professor where I attend school. When she heard that I work as a CNO for a travel nurse company, she immediately said: “Oh, strike-breakers, is that what you do?” Well, not exactly. AMN does provide nurses under both the traditional travel model and rapid response, but does not provide nurses for strike situations.
Choosing the Right Travel Nurse
Selecting among these varieties of nurses will impact the amount that a hospital will pay. For example:
1) traditional travel nurse – bill rate = X
2) rapid response travel nurse – bill rate = 1.25X-1.5X
3) strike-breakers – upwards of 2X+ (the sky is the limit)
How and when to choose between each of these types of temporary nurses will be determined by the strategic staffing plan in place at the time, but an understanding of your vendors and how they can successfully meet your needs is important to guarantee that the nurses will be there when you need them.
Getting to the Meat of the Matter
No matter what the needs of a facility, it always comes down to costs. Are travel nurses a cost effective way to supplement staffing shortages? What makes up the cost of a travel nurse and how do they compare to the costs of other staffing alternatives: overtime, float pool and per diem? Let’s do a side by side of a sample situation to see how they compare:
|Permanent Staff (36 hour week)||Traditional Travel Nurse|
|Pay: $35.00||Nurse pay rate: $35|
|Health, dental & life benefits: $7.00||Health, dental & life benefits; housing;|
|Vacation pay/sick leave: $4.95||401k matching; tuition reimbursement;|
|Other benefits (401k matching, tuition reimb, etc): $3.00||Social Security and unemployment,|
|Social Security and unemployment: $3.95||workers compensation,liability,|
|Workers compensation, liability and malpractice: $4.00||malpractice, recruitment and|
|Recruitment costs, signing bonuses||other administrative costs: $30|
|and orientation expenses: $5.35|
|Total Cost $63.25||Bill Rate: $65|
When I hear someone say that a travel nurse is making $65 per hour, I immediately want to know if this is truly what the nurse is making or is it the hourly fee that the hospital is paying for the nurse, as the latter is much more likely. Pay for traditional travel nurses is similar to that of permanent nurses. Rapid response travel nurses may make more, but only about 20-30 percent more than a traditional traveler. Strike-break nurses can bring in pay at or above $75 per hour.
One benefit for travel nurses that is real is the housing. Travel nurses often talk about their great housing benefits. Travel nurses enter a new city and have a move-in ready apartment waiting for them, or alternatively, they can opt to receive a cash housing subsidy in order to live in housing of their own choice.
Additionally, these nurses also do not typically receive paid vacation or paid sick leave. They are like other contract workers and when they need personal time off, they take it without pay—a significant benefit difference from typical staff nurses.
When evaluating the use of travel nurses in your strategic staffing plan, understand the fees and what they represent. Base your evaluation on the facts and not unit conversations. Travel nurses can be a cost-effective alternative to other staffing options AND are especially effective in controlling quality outcomes when other alternatives are unavailable.
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