And you could be right to be concerned.
Employee Turnover Can Be Costly
Although the estimates vary by position and pay level, each lost employee costs a business about 6 to 9 months of salary. That means if you’re paying an employee $40,000 per year, it could cost $20,000 to $30,000 to replace them.
Another estimate is 150% of their base salary, the Society for Human Resource Management says, when you consider extra administrative work, loss of time and money invested in training, and the costs to find and train a new hire.
You should expect an occasional employee voluntary exit, but what happens when you start to notice a trend? This happened to an internal medicine practice faced with “sudden, mass employee turnover.” According to the MGMA, they lost 12 employees – about half their clinical staff – in just 4 months. First they had to figure out why. Then they asked remaining staff what they like about the practice, developed an employee retention plan, and aggressively began recruiting.
Employee Satisfaction Remains Critical
Offering competitive pay is one obvious way to keep staff. But there are many other ways to keep medical group employees happy.
Working to create ‘superstar’ employees is worthwhile, especially in this era of value-based care and online patient reviews. “Your employees can reach superstar status only if their lower-order needs are met: The paycheck is good and working conditions are fair,” Judy Bee, practice management consultant with Performance Practice Group in La Jolla, California, told Medical Economics.
She suggests rewarding staff in creative ways, including:
- Extra paid time off
- Gas and other gift cards
- Tuition assistance for dependent children
Another tip – don’t discuss financial challenges facing your practice in front of office staff. It could lead to worries and distraction over their job security, Bee says.
Morale and More
Whether a practice intentionally reduces staff size to offset declining revenue or experiences voluntary turnover, it’s important to acknowledge and reward staff who stay. It’s more than a morale issue. When employees leave, it usually means more work for everyone else, especially in the short-term. An increased workload can also impact employee satisfaction.
“Faced with this challenge, some staff go about their day racing from one task to another, feeling increasing stress as they try to accomplish multiple, often competing demands,” says Deborah Walker Keegan, PhD, a healthcare consultant for Medical Practice Dimensions and Woodcock & Walker Consulting.
“They feel they cannot get out from under the weight of the work and are not able to do their very best work. As a consequence, some staff members are seeking jobs that are more defined [and less chaotic].”
For this and other reasons, employee retention made the Medical Economic list of top 15 challenges facing physicians in 2015.