Use of 1099 nurses has been painted in a negative light in recent years, with some going as far as saying they pose a risk for healthcare facilities. In reality, the true risk for patients and nurses lies in lack of nursing staff — and that’s an area where the right mix of employees and independent contractors can make a difference for long-term care. 

Today, the majority of U.S. states have fewer than 10 nurses per every 1,000 people. While the nurse staffing shortage isn’t new, the reasons why they’re leaving the field have become increasingly complex:

  • Benefit offerings have become increasingly stagnant, with only about one in five organizations improving or expanding upon benefits in the past year, according to a 2024 MGMA poll.
  • They crave more time for direct patient care, fewer administrative demands and greater time for professional growth, a McKinsey & Company analysis shows.
  • They also want greater control over when they work (93%), where, how much, and how their shifts are scheduled (about 25%), a recent survey shows.

And while 77% of healthcare CFOs say their organizations have increased starting wages for nurses by at least 20% in the past two years, 88% saw 10% or more of their nursing staff quit last year, another recent survey shows.

For skilled nursing facilities and others, which already face a difficult operating environment, support from contract nurses can help ensure patients receive quality care and nurse staff aren’t spread too thin, improving satisfaction for both care staff and patients.

A shifting tide for nurse vacancy strategies

With nurse turnover rates higher than 50%, it’s clear that skilled nursing facilities need to take a fresh look at how they are closing gaps in nurse staffing. That’s especially true at a time when the Biden administration established a minimum nurse staffing mandate for nursing homes. It’s a move that the U.S. Department of Health and Human Services estimates will require 75% of nursing homes to hire staff to meet daytime staffing requirements and 22% to hire staff for around-the-clock needs.

For so long, there has been a negative connotation associated with hiring 1099, or contract, nurses. Some leaders mistakenly associate contract nurses with travel nurses, which are expensive to procure.

But contract nurses can come from a long-term care facility’s own community. They typically are those who need greater flexibility — the flexibility to select specific shifts and as many or as few as they’d like, rather than sign on for a set number of shifts for a predetermined period—because personal circumstances or preferences require it. 

There’s also an economic benefit to relying on independent contract nurses to supplement full-time or part-time nursing staff when filling per diem shifts. In our experience, healthcare organizations that attempted to pull back on their use of 1099 nurses in favor of a W2-only approach in Q2 2024 ended up paying three to four times more for nurse staffing — and went back to posting shifts, where needed.

There are a few considerations long-term care organizations should keep in mind in exploring the use of 1099 nurses to close nurse staffing gaps.

  1. Put the power of staffing in their hands. Lean into a tech-enabled model that allows for the selection of which shifts they work, where they work them and even with whom they work them. Such an approach is a satisfaction-builder. It’s also a cost-saver for long-term care facilities, avoiding onerous and restrictive staffing firm contracts and reliance on high-cost resources. 
  2. Incorporate flexibility into your approach. A pragmatic approach to nurse staffing that views nurses as an elastic resource — as opposed to one that requires an exclusive commitment for a specific period — generates better financial and staffing outcomes for facilities. That’s why a flexible approach that empowers contract nurses to select the shifts they would like to fill is a more sustainable approach to diversifying staffing pools. Such a model should take into account a contract nurse’s qualifications and past performance with the organization. Pro tip: Allow multiple contract nurses to select multiple shifts.
  3. Do the math — initially and over time. Here, it’s important to consider the percentage of open shifts that are closed by independent contractors within 24 hours of the start time, the impact of 1099 support on nurse retention and turnover rates, and the hourly cost for support versus the hourly rate of a comparable W2 nurse. Another consideration: Look at the percentage of contract nurses who ultimately were hired by the organization at the end of the year. In our experience, one out of four caregivers who join healthcare teams as 1099 resources ultimately choose employment with that organization.

By understanding how to effectively leverage the different needs of 1099 and W2 employees, long-term care facilities can build a nurse-staffing approach that provides the right support for patients and protects their bottom line.

Curtis Anderson is the CEO of Nursa.

The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.

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