By Jeanniey Walden
Over the past several months, hospital systems and healthcare workers have faced unimaginable stress and challenges. At the same time, hospitals and healthcare facilities grappled with a severe financial crisis: Recent reports estimate the healthcare industry has suffered a $202.6 billion financial loss from COVID-19 from just March through June 2020 — an average of over $50 billion in losses a month.
These challenges touched nearly every facet of the industry and its employees. High turnover rates only add to the financial crisis and employee engagement is at risk of plummeting to new lows. Now, healthcare leadership is looking at any and all solutions that can alleviate these burdens. For some, the answer lies in providing flexible pay models to boost the bottom line and enhance the employee experience.
The need for flexible pay in healthcare right now
Despite the recent boom in convenient and flexible financial technologies — e.g., Venmo, PayPal, Zelle — the way in which employees get paid has not changed. In fact, the most notable change to payroll came with the advent of direct deposit in the 1970s.
Today’s workers are ready for something new: Nearly half of all North American employees are willing to accept nontraditional payment methods like paycards and mobile payments rather than a bi-weekly paycheck. Beyond the convenience this offers, in uncertain economic times, nontraditional, flexible pay can actually become a lifeline for employees — especially in healthcare.
Your healthcare workers have faced what could be the most difficult year of their careers, with no clear end in sight. While a flexible pay system does not alleviate the core issues related to the pandemic, it can reduce stress in other ways. For example, due to manufacturing delays and slashed hospital budgets, many healthcare workers find themselves picking up the tab for their own personal protective equipment (PPE) which is critical for keeping both themselves and their patients safe. With flexible pay that grants access to funds sooner than a traditional, bi-weekly paycheck, workers can more easily obtain the supplies they need to perform their duties safely.
Flexible pay benefits both healthcare employees and employers
Flexible pay is no longer just a nice perk, but something that can prove essential for supporting employees during uncertain times. Even more, flexible pay can reduce stress in other areas and help the greater organization cut costs and fill talent gaps.
- A Better Employee Experience: Since 2015, the average hospital has turned over 89% of its workforce and analysts say that this level of turnover is second worst only to hospitality. High turnover directly affects staff still employed. As staff tenure decreases, administration often cuts programs that contribute to an elevated employee experience, such as mentorship and professional development opportunities. When this happens, employees feel less supported and engaged. However, with flexible pay options, you give employees a different form of support: more control over their financial wellness. While this doesn’t alleviate all workplace stress or replace the need for professional support, empowering financial wellness and flexibility can increase employee engagement and overall happiness.
- No Cost to the Organization: The confluence of financial loss, high turnover rates and a tight labor market leaves hospitals in desperate need of solutions to help attract and retain employees. One method of doing so is presenting early access to earned income as a benefit to prospective talent — which will give you a leg up on the competition. Even more, using flexible pay as a recruitment strategy (and a tool for employee engagement) doesn’t impact the bottom line. Many flexible pay solutions are offered at no cost to the business and layer seamlessly with current payroll processes.
Flexible pay options are not the end-all solution for the burdens facing today’s healthcare professionals. However, wth the financial and emotional impact of COVID-19, healthcare workers stand to benefit from flexible pay that offers immediate financial aid in a time when budgets are tight and supplies critical.
Our essential workers have put their lives on the line for months, with no point in sight. If healthcare leadership can alleviate stress and boost the bottom line, then the way forward is clear — give your employees the flexibility to improve their financial wellness and workplace engagement with on-demand pay.
Jeanniey Walden is CIMO of DailyPay.