Career Pathing in Healthcare Starts With Fixing How Tuition Assistance Works

Healthcare organizations are hiring as fast as they can and still falling behind. Even as the sector added 693,000 positions last year, there are still nearly 1.5 million job postings open every month. And that demand is projected to outpace supply well into the next decade. 

Many healthcare organizations have invested time and resources in developing career ladders for frontline workers to retain motivated employees and fill specialized roles. Workers want to climb them, so why aren’t more of them advancing?

Internal talent development and designing career pathways is part of the solution, but only if workers can realistically take the next step — a step that in healthcare almost always requires a formal credential, months to years of schooling and cash upfront to foot the bill.For many frontline workers, the cost of that education is simply out of reach, and the tuition assistance programs most employers offer don’t do much to change that.

Healthcare organizations need to fill talent gaps 

The healthcare industry needs more specialists and struggles to retain the ones it has. Research suggests that 85% of rural health care executives and 45% of those in metropolitan areas can’t find local talent to fill essential roles in their hospitals and practices. Another recent study found that 55% of workers intended to search for, interview for or switch jobs in the next year.

At some point, a staffing problem becomes a patient problem. Outside metro areas, patients have to choose between traveling hours away to access specialized care or sitting on waitlists for months. Local family practices can’t take on new patients. Mental health clinics, overwhelmed, push appointments further and further out. 

Internal development and clear career pathing address both problems, giving workers a reason to stay and filling roles with people who already understand the organization and its patients.

The case for investing in internal career pathways

For healthcare organizations, the investment in internal talent is worth it because:

Healthcare systems will see better retention. Career pathing, which helps workers understand the exact next steps to advance their careers, gives employees a reason to commit to the organization long-term rather than look elsewhere for growth. When a motivated medical assistant chooses to become a radiologic technologist, she stays invested in the company, advances her career and brings operational context that an outside hire would take longer to acquire.

More internal development leads to greater savings. One study estimates it costs more than $60,000 to replace a single registered nurse. Those costs only grow the more specialized the role. By investing in the talent pools within the organization and prioritizing retention, an average sized hospital system can save hundreds of thousands. 

Improved care continuity. A nurse who moved into a specialty role already knows which patients get anxious before procedures, how the charting systems work and which attending needs a particular kind of briefing. That institutional knowledge doesn’t transfer when someone walks out the door. By retaining talent and helping healthcare workers move upward in the system, patients will experience more consistent, quality care.

Tapping internal talent is a viable workforce strategy for healthcare systems. But career pathing in most industries is simpler than healthcare. You get the entry-level role, receive coaching from a manager and get promoted. 

In healthcare, moving from one role to another or progressing within a specialty almost always means formal credentials, licensure exams and clinical requirements — which many frontline healthcare professionals can’t afford.

The barriers to climbing the healthcare career ladder 

Health systems have done the work of building career paths. But three problems keep workers from using them. 

Advancement requires costly, formal education. Nearly every healthcare role requires, at minimum, an associate’s degree. Say you have a CNA on staff who wants to become an LPN. That training program will take them anywhere from nine to 12 months to complete and cost roughly $2,000- $15,000, not including books or exam fees. 

Many workers already carry student loan debt from previous education and may not be able to front the costs themselves, even with the promise of employer reimbursement. 

Traditional reimbursement models put the financial burden on workers who can’t carry it. In an effort to support employees pursuing additional education, many health systems have implemented tuition assistance programs using reimbursement models: The employee pays for tuition upfront, completes the coursework and then waits to be paid back by the employer. That structure assumes workers have thousands of dollars available to float. Many  frontline healthcare workers don’t. 

Employees often don’t know the benefit exists. According to a recent survey we conducted, 42% of full-time workers across all education levels aren’t sure whether their employer offers tuition assistance or don’t understand how it works. Before the structure of tuition assistance becomes an issue, many workers have already given up on the dream of career advancement because of a communication issue.

How a direct pay tuition assistance model expands the talent pipeline

Recent reporting finds that 76% of employees interested in upskilling say they’d be more likely to use tuition assistance if education costs were covered upfront. Among younger workers, the exact population health systems are most actively trying to recruit and retain, that number rises to 78% of Gen Z employees and 83% of millennials.

Direct pay tuition assistance models remove the financial risk of upskilling from the worker, creating a usable career path. Under this benefit model, tuition funds move directly from the employer to the education provider, with no financial burden on the worker. The most effective direct pay models place no restrictions on education provider, format, or location, allowing workers to enroll in the accredited program that fits their schedule, with clinicals completed locally. 

For employees, this means no waiting for a reimbursement check and no need to take on credit card or student loan debt. For employers, direct pay programs incentivize workers to fill the roles they most need. By applying the benefit selectively, health systems can target the roles and pathways with the greatest staffing needs.

Most healthcare organizations have workers who want to advance and roles that need to be filled. What’s been missing is a benefit model that actually makes the next step possible. Fix that, and the pipeline starts to fill from the inside.