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Investing in Apprenticeships to Expand the Pool of Nurses for Vermont Hospitals

Hospitals around the United States have tried many financing models to recruit and retain more qualified nurses. A new financing initiative in Vermont is showing promise to improve the odds of success.

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It’s a very supportive program, says Pam Duchene. It allows that individual who always wanted to practice nursing but could never find the means or the resources or the time to do so. They’re already doing the physical part of the job, and they’re familiar with the hospital setting. But for whatever reason, they didn’t have the opportunity to go to school to be a nurse.


employers in Healthcare Collaborative

The Challenge

Alarm bells have long been sounding across the United States about the dangerously chronic shortfall of nurses needed to meet an ever-growing demand for their services. It’s a challenge that the University of Vermont Medical Center in Burlington has struggled with for years. “We’re no different than any other healthcare organization in the nation right now,” says Betsy Hassan, director of nursing education and professional development at the 560-bed facility that is part of a system that employs more health workers than any other in the state. To make matters worse for hospital leaders like Hassan, the COVID-19 emergency prompted many nurses to leave hospitals either for retirement or for lighter-duty jobs in schools or doctors’ offices. Many others have become freelance traveling nurses who earn significantly more money per hour than they do as full-time hospital staff. For hospitals that are desperate to fill out their nursing shifts, hiring these contract nurses is often unavoidable, but it compounds their already heavy budgetary burdens.

Many Vermont hospitals and health facilities understand the importance of financing the development of talent and the role it must play in shoring up their workforce gaps. Like many of their counterparts across the United States, they already deploy a range of talent finance investments to recruit more nurses and retain them longer. But, by the early 2020s — and especially after COVID’s severe disruptions — even those efforts left them without sufficient numbers of qualified nurses. It was time to consider an innovative approach that would put more of their talent financing dollars into training a largely untapped pool of would-be nurses.

The Solution

In 2021, the Vermont Talent Pipeline Management, an initiative of the Vermont Business Roundtable’s Research and Education Foundation, mobilized its Healthcare Collaborative, a diverse collection of 43 Vermont hospitals, residential care, and home health organizations. The group turned its focus to people already working in their midst as licensed nursing assistants, food and nutrition services workers, mental health technicians and related positions. The idea was to put financing resources for talent into an apprenticeship program that enables these workers to stay in their current jobs and, at same time, upskill and eventually become nurses.

Many of these workers likely have both the ambition and natural skills to become nurses. But, for a range of financial and personal reasons, they often have difficulty “finding the on-ramp” into the profession, says Mary Anne Sheahan, the chief talent officer for Vermont Business Roundtable, principal staffer at the Vermont Business Roundtable’s Foundation and the primary architect of the new approach. The Healthcare Collaborative, led by Sheahan, launched a talent financing initiative aimed at helping these workers overcome the barriers to becoming nurses, even as they remained working and earning a wage. And, as with any effective talent financing program, the Collaborative’s efforts to form crucial partnerships with various other relevant players across the state and to help limit risk, has given hospitals the confidence to plunge into the apprenticeship program.

The incentive to the apprentice nurses is obvious, says Sheahan. “We’re taking people at an entry level role like LNA [licensed nursing assistant], where the average pay is $17 an hour, to become a practical nurse in a year at about $27 an hour, to $37 an hour when they become a full RN [registered nurse].” As a result, participating hospitals have received many more applications for workers, with only 10 apprenticeship spots available in the first year’s cohort.

How It Works

The program is based on an elegant architecture.

First, participating hospitals continue to pay the apprentices the full-time wages and benefits they’re already receiving without requiring them to work full-time hours. That gives the apprentices the time off to complete their nursing coursework. Of course, this translates into additional costs the hospitals must figure into their talent financing equation; they must find and pay for others to cover the time apprentices would have otherwise worked.

Second, hospitals pay off the student loans their apprentices take out to finance their nursing school costs for repayment three years after becoming registered nurses. Out of context, that might sound to some like a hefty financial obligation for the hospitals, especially if you multiply it by 10 apprentices in each of three cohort years. But, again, most hospitals — not just in Vermont but around the country — are already committing significant sums of resources to recruiting and retaining nurses, and travelers, and they’re bullish that apprenticeships might provide one of the best returns on that investment.

According to Pam Duchene of Southwestern Vermont Medical Center (SVMC) in Bennington, where she is vice president for patient care services and chief nursing officer, her hospital already finances “all of those kinds of strategies to attract and retain great nurses.” And, she says, it has relatively modest recruitment and retention challenges because of its small size.

For example, SVMC works directly with local colleges and universities to expand the number of nursing students they graduate in part by giving some of its nurses time off to teach in those programs. That means SVMC has to pay for other nurses to cover for the unstaffed clinical shifts. The hospital also provides nurses up to $10,000 a year for six years in tuition forgiveness and offers many a signing bonus.

All of this more or less represents the cost of doing business these days for hospitals. But Duchene and Hassan agree that the investment their hospitals make in the Healthcare Collaborative’s apprenticeship program is a good and cost-effective complement to all the others. Paying off the loans for 10 apprentices over a three year term, Hassan says, “is far less than we spend on the traveling nurses they’ll replace.”

At the Heart of Vermont’s Economy

The Healthcare Collaborative was motivated to establish the apprenticeship program not only because the nursing shortage complicates the delivery of healthcare. The Collaborative could also see the economic implications of the problem, especially in Vermont where healthcare jobs are the most plentiful of all job categories in Vermont. They made up about 13 percent of the state’s workforce in 2021, down about four percentage points since before the pandemic.

When the Collaborative began in 2018, it conducted a workforce needs assessment of all its member care providers in 2018 and again in 2021. Among other findings, the study showed Vermont would need an additional 2,600 Registered Nurses in the next two years to be at sufficient capacity. But the state’s two- and four-year university and community college nursing degree programs produced only about 400 Registered Nurses in 2021 – up from 293 in 2019. Roughly a quarter of those graduates pursue job opportunities outside the state.

Female nurse taking blood pressure

“A very supportive program.”

Four Vermont hospitals are already taking part in the program, and Sheahan expects that number will grow in the coming years. The hospitals selected their first cohorts, and their programs will begin later in 2023.

To maximize the payoff of their investments — and to protect the apprentices themselves from financial difficulties — the hospitals have a strong interest in each member of their cohorts getting their education, passing their nursing boards and ultimately, performing well on the job. That’s why the Healthcare Collaborative’s program and the hospitals proactively stay close to the apprentices and, if necessary, connect them to “wrap-around support” in the event they struggle with childcare, food insecurity, transportation, academics, mentoring, and almost anything else that keeps them in school, working, and learning. Sheahan notes several of the participating hospitals have a relationship with Working Bridges, a United Way program in Vermont that provides this kind of employee assistance in large part to help Vermont employers improve job retention, productivity, and advancement.

Bringing it all together

The hospitals also benefit from all the work Sheahan has done to coordinate the inputs from the nursing colleges, to get the community training centers to expand their class sizes and to round up essential support services. “It’s not that we couldn’t do it ourselves,” Duchene says, “but it would be a lot harder to do. Mary Anne figured it out. She brought people together, figured out what the needs are and then figured out how to make it work. And then of course, she got some funding through Senator Leahy, which also helps.”

To help fund its work, the Collaborative was able to secure, with the help of former U.S. Senator Patrick Leahy of Vermont, a federal appropriation of  $1.2 million across three years. In June 2023, the Vermont Agency of Human Services announced it would provide healthcare providers an additional $9 million grant for those standing up the nursing apprenticeship pipeline program. Those proceeds will fund administrative support, clinical educator preparation, clinical education costs, education and fee costs not covered by grants and scholarships, paid release time for students, and wrap-around support.

As the Healthcare Collaborative contemplated options, it was clear that a new and innovative approach to talent financing could help broaden the pool of nurses in Vermont. It’s a model that can be readily applied to other clinical needs and professions and that hospitals around the U.S. might emulate.

“I really like the growth aspects of [this approach],” says Hassan. “For so many people in these entry-level positions, they can’t afford to go to school and work full time. There’s just not enough time in the day, and many have other responsibilities for their families. With this model, people can reach their full potential and accomplish goals they have. And hospitals can bring in more workers to help us solve our staffing shortages.”

Talent Finance is a collaboration of The U.S. Chamber of Commerce Foundation, the Federal Reserve Bank of Atlanta, the Greater Houston Partnership, Working Nation, Education Finance Council, SHRM, National Association of Workforce Boards, the National Governors Association, Social Finance, Jobs for the Future, and Uncommon Impact Studio. The mission of the Talent Finance Initiative is to make education, training, and credentialing more affordable, with less debt, and to achieve better outcomes for learners and workers. Talent Finance refers to the development and use of public and private instruments for aligning investments in talent development and in managing employment and income risks. Talent Finance explores how we can come up with a better public-private approach for how we finance and invest in talent.

The Vermont Business Roundtable and Vermont Student Assistance were members of the first cohort of the Talent Finance Design Workshop. The Design Workshop is intended for public and private organizations and professionals who want to: (1) learn more about finance instruments and innovations that can used in talent development and management; (2) network with peers and finance experts; and (3) design a new or improve an existing project(s) for implementation. Both organizations are members of the Talent Finance Innovation Network (TFIN), a community group dedicated to putting the Talent Finance guiding principles and framework into practice.

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